Mountain of Eskom debt blamed on consumers

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GK CRONJE

3 May 2022

According to Ntekele, the electrical demand far exceeds the supply that the municipality is capable of providing.

Amidst intermittent national load shedding, electrical outages and municipal load reduction, the community of Msukaligwa are gnawing on hard bones. According to Msukaligwa Local Municipality’s (MLM) director Ntekele, the load reduction is implemented as a last resort to avoid being completely switched off by Eskom for exceeding the notified maximum demand (NMD) set forth by the power utility. According to Ntekele, the electrical demand far exceeds the supply that the municipality is capable of providing. Ntekele claimed that Eskom has set forth an ultimatum that the municipality must manage the load to avoid exceeding the NMD, which, according to Eskom, will cause damage to transformers, cables and infrastructure. Ntekele has stated during a meeting that the current infrastructure isn’t rated to handle a higher electricity demand without suffering damage. According to the director, requesting a higher NMD from Eskom requires infrastructure upgrades, which the municipality simply does not have the fiscal capacity to provide. He also claims that Eskom charges an exorbitant amount to increase the NMD, and claims that Eskom does not have the appetite to supply a higher rating.

Furthermore, the director claims that the agreement between Eskom and the municipality, which dates back to circa 1985, has not been sufficiently amended to provide adequate electrical supply to meet the demand of the rapidly expanding Ermelo and surroundings. The situation is of such a nature that even the Democratic Alliance (DA) has taken note, and wrote a letter to the COGTA MEC. “The DA finds it extremely concerning that during the recent load shedding, the residents and business owners of Ermelo have been forced to face 12 hours or more without electricity - as areas in Msukaligwa Local Municipality faced a combination of load shedding together with load reduction because the municipality goes over the Notified Maximum Demand from Eskom. In a number of municipalities across the province, situations like these not only place a strain on businesses in the area but it also can destroy household appliances due to fluctuating voltages and the potential surge when turning the power back on. It is shocking to note that if Msukaligwa Local Municipality was able to capitalize on reducing the exceptionally high electricity distribution loss of 45% as reported on in the 2019/ 2020 Auditor General’s report, the residents and businesses could have been saved from this prolonged darkness,” the DA’s Trudie Grové-Morgan said.

To add insult to injury, Eskom has released a list of the top ten defaulting municipalities in Mpumalanga, which includes MLM. According to Eskom, the top ten owes a combined amount over R13 billion. eMalahleni is the biggest debt culprit, and owes Eskom nearly R6 billion in arrear payment. MLM is, as of 31 March 2022, R153 719 572 in arrears on their repayment agreement to Eskom. This, in turn also has an adverse effect on Eskom’s willingness to increase the NMD to MLM, seen as repayment is a clear hurdle. However, shortly after Eskom’s announcement, MLM was quick on the draw, releasing a statement claiming that consumers owe the municipality an amount of R909 557 309 for service delivery. However, residents have scoffed at the statement in derision. “If you skip one month of payments to the municipality, even if you pay late, you are swiftly disconnected by the municipality. How is it possible to have so many non-paying residents. That is a clear indication that the municipality’s finance department is not doing its work in collection of funds,” one resident stated. In addition to this, questions are also raised if this is an actual owed amount by residents.

MLM has garnered a notorious reputation for wholly incorrect and exorbitant estimates of water and utlitly accounts, which are rarely corrected and updated on the crippled billing system. According to MLM, Ermelo owes nearly R220 million in service delivery fees, with Wesselton owing R191 million, Breyten owes R150 million, Lothair owes R93 million, Davel owes R56 million, Chrissiesmeer owes R44 million, Sheepmoor owes nearly R9 million, Warburton owes a mere R213 000. MLM further states that state departments owe nearly R22 million, the business sector owes R170 million, and farms owe nearly R47 million. It is unclear at this stage how farms were calculated, as the majority of farms are Eskom supplied.