Eskom wants to cut Bloem's power due to unpaid bills - these municipalities could be next
- Municipalities owe Eskom R36.5bn – with Soweto representing more than half of total municipal debt.
- Eskom is threatening to cut off electricity to three Free State municipalities.
- Emfuleni municipality in Gauteng, as well as the Emalahleni and Govan Mbeki municipalities in Mpumalanga, could be next as the utility takes a harder line.
- For more stories, go to www.BusinessInsider.co.za.
Municipalities owe Eskom more than R36bn – and the utility is ramping up plans to cut off their electricity supply until it recoups some of the money.
Last month, National Treasury gave Eskom a R59bn lifeline in part in exchange for a commitment that it will recover municipal debt. Accordingly, the utility is taking a harder line with municipalities and this week warned that it will cut power to three municipalities in the Free State, including Mangaung (Bloemfontein, Botshabelo, Wepener and Thaba Nchu) due to unpaid bills. Mafube and Mantsopa municipalities (Frankfort, Tweeling, Villiers and Ladybrand) will also be affected. The power cuts of 16 hours a day will start on December 3.
According to government’s Roadmap for Eskom, which the department of public enterprises released last month, these municipalities owe the most money:
Last month, Eskom threatened the Emfuleni municipality in Gauteng, and Emalahleni in Mpumalanga to pay up a part of their outstanding debt or suffer electricity cuts. Govan Mbeki municipality (Secunda, Bethal, Trichardt, Kinross and Evander) have already received repeated threats, without a resolution.
In total, municipalities owe Eskom R36.5bn – with Soweto representing more than half of total municipal debt.
This week, Fin24 reported that Eskom is planning to cut off power to households in Soweto which tampered with their prepaid power meters. According to Eskom, of the 180 000 customer prepaid meters in Soweto, 120 000 meters had been tampered with.
Recently, Eskom cut power to 2,700 households in Orange Farm in the Vaal Area, after local households failed to pay their bills. Eskom says it's increasingly disconnecting non-paying customers across Gauteng.
Apart from Soweto, the Maluti-a-Phofung municipality (Harrismith) in the Free State has the biggest outstanding debt, of more than R5 billion.
Like many other municipalities, a great number of local businesses and households pay their electricity bills in full and on time – but the municipality, which collects the money, doesn’t pay it over to Eskom. In Harrismith, Eskom recently agreed with local businesses that it will in future directly collect payments from them – bypassing the municipality.
(Compiled by Helena Wasserman)
Receive a daily update with all our latest news: click here.
Also from Business Insider South Africa:
- Play the race card! Nando's just introduced a hilarious SA version of Monopoly
- From patching shoes and soccer balls in the township, this young entrepreneur built an award-winning leather business
- Vodacom's tech boss just quit at a tricky time - to join a Johann Rupert company
- KFC has quietly rolled out a spicy new 'masala' flavour for its chicken – and we think it is better than the original
- 'Vodacom' is now lending small businesses up to R1.5 million, with cash in 24 hours
- State-owned bus company wants R350 million bailout