We’ll pay Eskom, not municipality

schumi

schumi

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While 96 municipalities across the country are scrambling to negotiate payment agreements with Eskom for overdue bills that amount to R27.8-billion, local businesses are fighting to pay Eskom directly, bypassing the municipalities, in a bid to keep the local economies going.

By this week Eskom had signed 56 payment agreements with municipalities and was a respondent in at least three court cases to prevent the utility from cutting off power for between four and seven hours a day.

But the cuts are inevitable, Eskom said this week, and have been happening since September last year.

“Eskom has interrupted supply to a total of 17 municipalities,” said Eskom spokesperson Dikatso Mothae. “Initially the interruption was for four and a halfhours a day. In some cases the interruptions were extended to six and a half hours a day and the next step would be for 14 hours a day. No municipality has been interrupted for 14 hours a day [yet],”

This final step of 14-hour interruptions may soon become a reality for municipalities such as Emfuleni in Gauteng and Maluti-a-Phofung in the Free State.

The repossession of Emfuleni’s fleet of government vehicles this week further hurt the wounded municipality, which was placed under administration by the Gauteng provincial government after it was declared bankrupt in January this year.

More than 70% of Emfuleni’s gross domestic product is based on the steel mills and metal manufacturing industry, which now faces 14-hour blackouts because of the municipality’s nonpayment. These companies have now applied to the high court in Johannesburg to prevent blackouts in Vereeniging, Vanderbijlpark, Sebokeng, Boipatong, Tshepiso, Sharpeville and Evaton.
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More at: https://mg.co.za/article/2018-08-17-00-well-pay-eskom-not-municipality
 
For the industries concerned, I sincerely hope that they can pay Eskom directly.

And of course you'll be charging/paying interest on overdue payments, banks does it so why should it come as a surprise to these municipalities concerned?
 
The issue is that they are connected to the municipality and a client of the municipality under NERSA's rules so it would be kinda illegal for Eskom to bypass the municipality except if a wheeling agreement was signed.

It's a fight lost before it even started unfortunately.

Letting municipalities handle the distribution is one of the stupidest concepts around TBH.
 
f2wohf said:
Letting municipalities handle the distribution is one of the stupidest concepts around TBH.
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To be fair it always worked in the past. Granted, they supplied a lot less people than they do today, but the fact that the ANC have left technical services neglected in favour of employing their comrades who would never qualify for these technical positions has made the problem a lot worse than it could be. They really employ far too many admin people instead of people who can deliver services. I heard Motsoaledi bemoan the same about health services where provinces are employing too many admin people instead of health care service providers and then saying they have no budgets to fill essential positions while employing their friends, girlfriends, families and others to these admin level under the table.
 
R13... said:
To be fair it always worked in the past.
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It's inefficient by its mere nature, particularly in rural low density areas.

A national transmission and distribution company would be insanely more efficient at it (the price of the equipment in SA is actually very high partly because of the low purchase volumes from each different entity for example).
 
The_Librarian said:
For the industries concerned, I sincerely hope that they can pay Eskom directly.

And of course you'll be charging/paying interest on overdue payments, banks does it so why should it come as a surprise to these municipalities concerned?
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Exactly this. I feel for those that paid the muni and are now being punished due to muni not administrating funds correctly.
 
Venomous said:
Exactly this. I feel for those that paid the muni and are now being punished due to muni not administrating funds correctly.
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The problem now is, should the courts grant that the businesses can pay Eskom directly, how will the municipalities concerned be able to pay off the debt accrued without the extra cash flow?

Interesting going forward.
 
The_Librarian said:
The problem now is, should the courts grant that the businesses can pay Eskom directly, how will the municipalities concerned be able to pay off the debt accrued without the extra cash flow?

Interesting going forward.
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They would need to start charging their users and cut off those that use and don't pay.
 
The_Librarian said:
The problem now is, should the courts grant that the businesses can pay Eskom directly, how will the municipalities concerned be able to pay off the debt accrued without the extra cash flow?

Interesting going forward.
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A small stuff up can be corrected and be forgiven. The extend of this total F up means that the muni is not to be trusted.
 
The_Librarian said:
For the industries concerned, I sincerely hope that they can pay Eskom directly.

They cant pay directly because the municipality owns the metering infrastructure, substations, cables etc.

And of course you'll be charging/paying interest on overdue payments, banks does it so why should it come as a surprise to these municipalities concerned?
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I have no idea how one solves this issue.
The solution is not to keep providing electricity and letting many people not pay

Eskom will (rightfully) cut off the whole Municipality which means the poor business/household that pays their bills gets screwed...

Eskom could take over the billing and the entering infrastructure but thats easier said than done

The municipalities have failed to do business properly

I never appreciated how living or doing business in a crap municipality can hurt one.
How does one keep a business going if one has no electricity...
 
Thing is - the businesses will smile as they don't pay the markup that Municipalities have on the electricity - so win there for them.

Plus - they deal directly with the provider of the electricity who is now responsible for the maintaining of the infrastructure to the client also (since you are paying them)...

The municipality is now out of the electricity "revenue" (that lovely markup they use to cross subsidise all the other shenanigans services they provide to the people. Pretty soon, the municipality is bankrupt and under administration - and another one bites the dust... slowly driving back to a point of rest where "everything works" in certain terms...
 
Biscuit1018 said:
I have no idea how one solves this issue.
The solution is not to keep providing electricity and letting many people not pay

Eskom will (rightfully) cut off the whole Municipality which means the poor business/household that pays their bills gets screwed...

Eskom could take over the billing and the entering infrastructure but thats easier said than done

The municipalities have failed to do business properly

I never appreciated how living or doing business in a crap municipality can hurt one.
How does one keep a business going if one has no electricity...
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One can't, eventually one is fully decolonized (aka, no business).
 
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