Eskom's electricity crunch is filtering down to municipality-owned entities, who are beginning to face wide-ranging problems in providing power to South Africa’s biggest municipalities.
Johannesburg’s City Power has a R655-million hole in its revenue books, but seems unable to explain how this came about. Soweto residents continue to shrug off a R4-billion Eskom bill dating back more than a decade and the city in the 2013-2014 financial year experienced electricity losses of R2.1-billion.
City Power has undertaken to investigate how, amid a national power crisis that threatens to cripple the country’s economy, it failed to collect a significant chunk of revenue, which could see it unable to provide uninterrupted electricity to the country’s economic hub.
City Power did not respond to questions.
Council documents seen by the media show the utility was unable to collect the R655-million because of:
- Decreased sale of prepaid electricity;
- Connected customers not being billed;
- Large power users not being metered;
- Installations illegally converted to prepaid meters; and
- Declining numbers of accounts invoiced.
Durban’s Ethekwini Municipality has seen a drop in electricity consumption of just under 2% overall, with a 3% in prepaid use.
Municipal spokeswoman Tozi Mthethwa said: “The decrease can be attributed to a number of factors including the economic slump, energy efficiency, the disruptive nature of load-shedding to businesses, higher electricity costs, customers generally using less electricity and managing their use better through prepaid meters.
“The increase in prepaid sales can be attributed to the electrification of informal settlements with the sale of nearly 11000 prepaid metres in the last six months.”
Higher electricity prices have resulted in decreased consumption among high-end users in the City of Cape Town. This is forcing low-end users in the city to pay more because they are no longer being subsidised by the once high-end users.
Ernest Sonnenberg, Cape Town mayoral committee member for utility services, said: “We still have to balance the books at the end of the day. This means that since we are getting less revenue from our high-end users, low- end users have to pay more.
“Where there is load-shedding or lower electricity sales, we have to adjust our budget downwards as less revenue is collected, meaning a lower budget for electricity services.”
Converting municipal waste into electricity and harnessing the heat from smelters, sugar and paper mills and collecting methane from sewerage have been punted by energy experts as ways for municipalities to generate energy, while businesses could start working into the night to reduce the burden on peak electricity usage as Eskom struggles to meet morning and afternoon demands.
Eskom spokesman Andrew Etzinger agreed there were initiatives which could reduce the country’s burden.
Meanwhile, about 5000 pupils in 41 schools across Ekurhuleni will learn without electricity after the municipality disconnected services because of unpaid bills.
“Schools were disconnected because of assessment rates and taxes owed by the Gauteng Department of Infrastructure Development,” said departmental spokesperson Nanagolo Leopeng.
“The Gauteng Department of Education is in negotiations regarding the payment.”
Ekurhuleni spokesman Themba Radebe said the municipality was owed R46-million in rates and taxes by schools and administration buildings. — additional reporting by Shenaaz Jamal, Nivashni Nair, Poppy Louw and Dominic Skelton
Eskom power cuts hurt municipal income
Johannesburg’s City Power has a R655-million hole in its revenue books, but seems unable to explain how this came about. Soweto residents continue to shrug off a R4-billion Eskom bill dating back more than a decade and the city in the 2013-2014 financial year experienced electricity losses of R2.1-billion.
City Power has undertaken to investigate how, amid a national power crisis that threatens to cripple the country’s economy, it failed to collect a significant chunk of revenue, which could see it unable to provide uninterrupted electricity to the country’s economic hub.
City Power did not respond to questions.
Council documents seen by the media show the utility was unable to collect the R655-million because of:
Durban’s Ethekwini Municipality has seen a drop in electricity consumption of just under 2% overall, with a 3% in prepaid use.
Municipal spokeswoman Tozi Mthethwa said: “The decrease can be attributed to a number of factors including the economic slump, energy efficiency, the disruptive nature of load-shedding to businesses, higher electricity costs, customers generally using less electricity and managing their use better through prepaid meters.
“The increase in prepaid sales can be attributed to the electrification of informal settlements with the sale of nearly 11000 prepaid metres in the last six months.”
Higher electricity prices have resulted in decreased consumption among high-end users in the City of Cape Town. This is forcing low-end users in the city to pay more because they are no longer being subsidised by the once high-end users.
Ernest Sonnenberg, Cape Town mayoral committee member for utility services, said: “We still have to balance the books at the end of the day. This means that since we are getting less revenue from our high-end users, low- end users have to pay more.
“Where there is load-shedding or lower electricity sales, we have to adjust our budget downwards as less revenue is collected, meaning a lower budget for electricity services.”
Converting municipal waste into electricity and harnessing the heat from smelters, sugar and paper mills and collecting methane from sewerage have been punted by energy experts as ways for municipalities to generate energy, while businesses could start working into the night to reduce the burden on peak electricity usage as Eskom struggles to meet morning and afternoon demands.
Eskom spokesman Andrew Etzinger agreed there were initiatives which could reduce the country’s burden.
Meanwhile, about 5000 pupils in 41 schools across Ekurhuleni will learn without electricity after the municipality disconnected services because of unpaid bills.
“Schools were disconnected because of assessment rates and taxes owed by the Gauteng Department of Infrastructure Development,” said departmental spokesperson Nanagolo Leopeng.
“The Gauteng Department of Education is in negotiations regarding the payment.”
Ekurhuleni spokesman Themba Radebe said the municipality was owed R46-million in rates and taxes by schools and administration buildings. — additional reporting by Shenaaz Jamal, Nivashni Nair, Poppy Louw and Dominic Skelton
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