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Eskom pulls plug on defaulting NC municipalities

Jan 29 2016 09:12
Fadia Salie

Cape Town - Eskom on Friday interrupted power supply to five Northern Cape municipalities due to non-payment.

The affected municipalities are Magareng, Thembelihle, Ubuntu, Dikgatlong and Renosterberg.

The total combined arrear debt for the five defaulting municipalities is standing at just over R113m as at December 2015, threatening the financial sustainability of Eskom in the Northern Cape, the power utility told Fin24 in an emailed response.

"Eskom is legally bound by the Public Finance and Management Act (PFMA) to collect all revenue due to it and therefore, we cannot allow debt levels to go unchecked."

Eskom said the municipalities defaulted on existing payment terms and payment arrangements.

Supply will be disconnected between 07:00 - 10:00 and 18:00 - 20:00 only in the mentioned municiplaities. This is not load shedding, Eskom said.

By August last year, Eskom was owed R4.4bn by defaulting municipalities.

Public hearings are currently underway into a possible tariff hike that will enable Eskom to claw back R22.8bn for the 2013/14 financial year.

Eskom's regulatory clearing account (RCA) application before energy regulator Nersa is for cost recovery and revenue adjustments based on actual past variances and not a revenue application based on future estimates.

Eskom also said on Friday that it has been able to avoid load shedding for the past 136 days and expects the system to remain stable throughout the rest of the summer period following a rigorous programme of planned maintenance without implementing load shedding.

The outage plan for the 2015/16 financial year made provision for the execution of 10.5% planned maintenance (4 624 MW). Eskom is projecting to achieve 13% planned maintenance (5 725 MW) by the end of the current financial year. This reflects an increase of 2.5% (1 101 MW) over and above the initial planned maintenance scheduled for the current financial year.

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eskom  |  debt  |  municipalities


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