Municipalities sign up for Eskom debt relief programme

At least 70 municipalities have applied for and been approved for the Eskom debt relief programme introduced by National Treasury last year.

The debt relief programme is aimed at assisting ailing municipalities to pay off their bulk electricity supply debt to the power utility.

This was revealed in the 2024 Budget Review drafted by National Treasury.

“By December 2023, 72 applications had been submitted, totalling R56.7 billion or 96.9 % of total municipal debt owed to Eskom at end March 2023. [Some] 70 applications totalling R55.2 billion had been approved as of January 2024, said Treasury.

Once municipalities are admitted into the programme, strict conditions set by Treasury have to be followed in order for the debt to be written off over a three-year period.

“These conditions include enforcing strict credit controls, paying their monthly electricity accounts and enhancing revenue collection,” Treasury said in February.

Smart meter conditional grant

In the Budget Speech tabled by Finance Minister Enoch Godogwana, Treasury announced that a new conditional grant will be introduced to increase the rollout of prepaid smart meters.

“A new conditional grant will be created to fund the rollout of smart prepaid meters, initially in municipalities that have been approved for Eskom debt relief. The National Treasury will distribute this grant.

“A total of R2 billion has been allocated for the grant, made up of R500 million in 2024/25, R650 million in 2025/26 and R800 million in 2026/27,” the department said.

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