South Africa’s power utility announced today that 15 Free State Municipalities and Mangaung Metropolitan owe R16 billion for services rendered, as at the end of February 2022.
Eskom supplies electricity monthly in bulk to the Municipalities and Metropolitan which is re-distributed and consumed.
“The Municipalities and Metropolitan receive government grants as well as payment for services rendered from their loyal customers, but these amounts remain unpaid for the consumed energy to Eskom,” the power utility said in a statement.
“This behaviour threatens the security of supply to the citizens residing in these supply areas, as Eskom cannot continue to maintain its infrastructure and supply electricity for free.”
Below are the defaulting Municipalities and Metro ranked in order of debt owed to Eskom.
The top three municipalities consume R200m (97GWh) of energy, on average, monthly. To date these municipalities have increased their debt to Eskom to R12.5 billion! Collectively this accounts for 78% of the overdue debt in the province.
“Municipalities have a constitutional responsibility and duty, not only to Eskom but to their customers, to fulfil their financial obligations for the bulk supply of electricity so that Eskom can in turn meet its obligations,” says Agnes Mlambo, the General Manager for CentralEast Cluster (KZN and Free State).
“The total outstanding municipal debt of R16 billion in Free State continue to threaten Eskom’s commitment to ensure continuity of supply and the ability to maintain the network. We thank those municipalities in the province that prioritise their Eskom account payment.”
Municipality debt puts immense burden on Eskom’s revenue stream, which negatively affects service delivery.
