Eskom has won a case in the South Gauteng High Court which it said affirmed its right to interrupt or terminate electricity to non-paying customers.
The case, which was brought against the utility by Pioneer Foods, sought to review and set aside a 2018 decision by Eskom to interrupt electricity supply to the Walter Sisulu Municipality.
The utility had taken the measure after the municipality – which is located in the Eastern Cape – failed to pay for supplied electricity.
The court ruled that Pioneer Foods had no standing in the electricity supply agreement between Eskom and the municipality and dismissed the application with costs.
Because Pioneer Foods is a customer of the municipality, the court said it had no legal right to bring the case against Eskom to court.
The court added that Pioneer Foods had an available remedy in lodging a dispute with Nersa, which it did not do.
“This is a landmark judgment affirming the validity and lawfulness of Eskom’s rights, powers, and entitlement to invoke section 21 (5) of the Electricity Regulation Act of 2006 to interrupt the supply of electricity to a delinquent customer,” Eskom said.
“Eskom welcomes this landmark judgment as the court has set the important legal principle that Eskom is only obliged to supply electricity to paying customers,” it added.
R31 billion in municipal debt
The court further held that Eskom’s interruptions of supply to the defaulting municipality were important and necessary for the utility’s survival.
The Walter Sisulu Municipality is one of many in the country which currently owes Eskom for electricity.
As of December 2019, the municipality had incurred a debt of R222 million to Eskom.
According to Eskom, the decision will help to enhance the utility’s collection efforts from defaulting municipalities, who collectively owe Eskom more than R31 billion in overdue debt.