Eskom’s power cut plans of great concern

Eskom’s plans for a possible interruption of bulk electricity supply to the top 20 defaulting municipalities is of great concern to the small business sector, the AHi business chamber said on Monday.

The total municipal arrears debt greater than 30 days stood at R4.6bn as at March 31 2015, Eskom said in a statement.

Of this amount, the top 20 defaulting municipalities are currently indebted to Eskom to the amount of R3.68bn for the bulk supply of electricity.

Eskom said it was “contemplating” a regulated interruption of electricity.

“Most of our members do have business interests in many of these municipalities and are paying their bills on time. However, it is clear this money is not paid over to Eskom,” said AHi CEO Christo van der Rheede.

He said Eskom’s proposed reaction to its predicament is understandable.

“However, disrupting the electricity supply to businesses paying their bills on time will lead to greater socio-economic challenges, especially in rural areas,” he said.

“Businesses are already confronted with a range of factors undermining growth and sustainability. Consequently, these planned disruptions will be disastrous for many of them.”

During the AHi’s last meeting with Deputy President Cyril Ramaphosa and Minister of Energy Tina Joemat-Pettersson in Pretoria, representatives of Business Unity South Africa (Busa) and other role players were assured of government’s commitment to open and regular communication about the situation at Eskom.

However, Eskom’s latest announcement about its plans to interrupt bulk electricity supply to defaulting municipalities does not reflect the letter and spirit of this commitment to the business sector, Van der Rheede said.

“The AHi, on behalf of small business in South Africa, appeals to Busa to take this issue up with Eskom as a matter of urgency.

In addition, businesses operating in the jurisdiction of municipalities which are defaulting on payments to Eskom must be given the opportunity to purchase electricity directly from Eskom,” said Van der Rheede.

“This is the most sensible thing to do as defaulting municipalities will continue to renege on agreements.”

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Eskom’s power cut plans of great concern