Eskom Takes Over Electricity Supply in Emfuleni Municipality

Eskom, South Africa’s primary power utility, has announced that it will assume control over electricity supply functions and services in the financially troubled Emfuleni Local Municipality. This development follows a Pretoria High Court mandate from July 5, 2023, requiring the municipality to appoint Eskom as its service delivery agent.

The court order grants Eskom the authority to collect all revenues from Emfuleni for electricity distribution. These funds are to be deposited into a newly established ring-fenced account under the municipality’s name. This agreement is part of Eskom’s efforts to ensure financial discipline and transparency in revenue flows.

Amanda Qithi, Eskom Gauteng spokesperson, confirmed on Thursday that the power utility and Emfuleni Local Municipality reached an agreement regarding the attachment of bank accounts. This arrangement is meant to facilitate the payment of salaries to municipal employees amidst the financial constraints faced by Emfuleni.

“This follows the successful attachment of Emfuleni’s four bank accounts on September 11, 2024, by the Sheriff of the High Court,” said Qithi. This action was prompted by Eskom to enforce the court order due to Emfuleni’s failure to clear its bulk electricity account obligations.

Qithi further stated, “Eskom and Emfuleni Local Municipality are committed to working closely together to ensure a smooth transition.” The municipality has pledged to cooperate and adhere to the Distribution Agency Agreement set forth by Eskom.

Eskom disclosed last month that Emfuleni’s debt of R8 billion represents approximately 10% of the R82 billion in total owed by various South African municipalities. This places Emfuleni among the top three indebted municipalities.

Additionally, Eskom spokesperson Daphne Mokwena highlighted that the municipality’s failure to meet the National Treasury’s debt relief program criteria has exacerbated the utility’s financial challenges. Mokwena expressed concerns about the impact of this debt on Eskom’s operational sustainability and its ability to provide consistent and affordable electricity to citizens.

Municipal debt, as noted by Mokwena, continues to be a significant challenge for Eskom as the power utility attempts to maintain financial stability amidst widespread arrears from local governments.