Though load-shedding seems to be a thing of the past, residents of Joburg may spend Christmas in the dark.
Eskom announced on Thursday night that it has started the process to cut power supply to Johannesburg’s City Power due to unpaid bills of R6.3bn, R4.9bn of which is arrears debt.
It is not clear when Eskom plans to implement the supply interruptions or what form it will take. Some parts of Joburg that are supplied by Eskom directly, will be excluded from the action.
Eskom said in a statement it had served a notice of intention “to interrupt power supply to the City of Johannesburg (CoJ) and City Power at certain predetermined times of day in accordance with the Provision of Promotion of Administrative Justice Act (Paja)”.
Eskom said it had tried everything to accommodate the struggling city but it cannot continue to do so “without putting further financial strain on and harming its own business”.
It said when entities such as the City of Joburg failed to pay Eskom timeously or at all, it forces Eskom to borrow additional money at premiums to fund operational costs.
“Operational costs should be funded by revenue generated from electricity sales and not by borrowings. Borrowing money to fund operational cash shortfalls caused by the failure of municipalities such as the CoJ to pay Eskom for bulk electricity increases the costs of providing electricity exponentially,” it said.
Eskom said that its municipal debt rose to a record R90bnbn at the end of September.
“Eskom’s financial sustainability and ability to supply electricity at affordable prices is contingent upon its ability to improve its balance sheet by increasing revenue and reducing expenses. Revenue can only be increased by collecting electricity debts and/or increasing electricity tariffs.”
It said the metro had acknowledged its indebtedness to Eskom, but refused to pay the full amount of its monthly bill.
“The City alleged, without substantiating their claim, that Eskom is overbilling it on some of its supply points. It is for this reason that the CoJ is applying set-off against the monthly bills raised by Eskom, which is contrary to the electricity supply agreement and the agreements reached.”
According to Eskom, “it was agreed that the City would continue to pay while the alleged overbilling is investigated; this undertaking has been reneged on”.
Eskom will proceed to issue a public notice on Friday to invite stakeholders to comment on its plans to interrupt supply.
Eskom will decide whether it will proceed or not after reviewing the representations on December 12.
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