Two councils saved from power cuts
ESKOM WILL ALSO CHANGE PAYMENT PERIOD FOR BULK INFRASTRUCTURE FROM 15 TO 30 DAYS
Eskom said on Sunday it had suspended scheduled power interruptions to two Mpumalanga municipalities, Govan Mbeki and Thaba Chweu, citing commitments the councils had made to settling their outstanding debt on electricity bills.
Power utility Eskom said on Sunday it had suspended scheduled power interruptions to two Mpumalanga municipalities, Govan Mbeki and Thaba Chweu, citing commitments the councils had made to settling their outstanding debt.
Eskom has already begun interrupting power supply to two other Mpumalanga municipalities, Emalahleni and Msukaligwa, as a result of unpaid electricity bills.
In a statement, group executive for customer services Ayanda Noah said Eskom welcomed the willingness of municipalities to settle their debt and that power interruptions were a last resort.
Meanwhile, the South African Local Government Association (Salga) met with SA’s nine provincial premiers, as well as President Jacob Zuma, at the Union Buildings in Pretoria on Friday.
While council debt to Eskom was not discussed in detail, Salga chairman Parks Tau has previously said the association would escalate the issue to Zuma should interruptions continue. Salga is expected to brief Zuma and premiers on increasing debt at a later date.
During a briefing by Parliament’s governance and administration cluster on Thursday, Cooperative Governance and Traditional Affairs Minister Des Van Rooyen said many of the indebted councils were unable to honour payment agreements.
“There are a plethora of reasons why councils can’t pay. They range from financial to legislative,” said Van Rooyen.
He said there was a discrepancy between what councils paid to Eskom and what they charged to consumers for electricity, which was informed by the level of poverty experienced by their residents.
“Many provide these services at a loss. If you look at how Eskom managed the credit, it leaves a lot to be desired. Eskom charges interest as of the 15th [of the month] and municipalities use the prescribed provision of 30 days. This creates a cycle of debt that makes it spiral,” he said.
Eskom has disrupted power to eight municipalities in three provinces since January 2017.
The utility has made some concessions for councils.
Those that commit to repayment agreements will see the interest rate on their debt reduced from prime plus 5% to prime plus 2%.
The utility said it would also change its payment period for municipal bulk infrastructure from 15 days to 30 days.