Eskom in battle with City Power over R1-billion debt

Eskom is taking Johannesburg power utility City Power to court over its debt for electricity supply. The affidavits it supplied with its court filing show that City Power owes nearly R1 billion for four invoices from late March 2024.

The court documents, which MyBroadband has seen, provide a breakdown of the individual invoices, including the supplied location and its consumption charge. It owes nearly R500 million for the one bill from 28 March.

The bill in question includes three charges — R105 million, R184 million, and R197 million — totalling R486 million.

City Power also still owes Eskom R336 million for an invoice from 29 March, R19.6 million for an invoice dated 30 March, and R57 million for an invoice from 31 March.

Altogether, the amounts owed for the four invoices total R908 million.

To clarify, there are more amounts owed to Eskom than just those listed in the four March invoices. Eskom says City Power owes it R1.073 billion.

Eskom revenue management manager Susan Smith said City Power has been rolling its electricity debt since October 2023.

She added that it has continued to do so despite making promises to get its affairs in order.

“All that Eskom is asking is for the City to make good on its promises to get its affairs in order and to pay what it admits owing Eskom instead of selectively paying accounts as and when it pleases,” said Smith in a signed affidavit.

“Despite Eskom’s best efforts to accommodate the CoJ [City of Johannesburg], the matter has reached a point where Eskom can no longer afford to accommodate the CoJ without harming its own business.”

“Eskom is not a bank and does not have the financial means to bankroll the CoJ electricity debt of more than R1 billion,” she added.

The state-owned power utility announced that it had implemented legal action against City Power in a statement published on Monday, 6 May 2024.

It said it had no choice but to apply to the Johannesburg High Court for a declaratory order forcing City Power to pay what it owes Eskom.

The case is set to be heard on 4 June 2024.

City Power fired back at Eskom the next day, claiming the state-owned power utility owes it more than R3 billion in overcharges dating back to 2021.

It said that the City of Johannesburg had, on several occasions, raised concerns with Eskom regarding the alleged overbilling.

“Eskom has admitted in some cases that there have been potential billing inaccuracies and has so far refunded City Power at least R483 million over the recent years,” it said.

However, City Power says its assessments show Eskom owes it much more.

“Following multiple discussions regarding queries that have been lodged in connection with gross inaccurate billing on bulk purchase invoices, Eskom has opted to ignore those issues and rushed to the courts,” it said.

“As a matter of process, the City will be opposing the court application that Eskom filed, because it has no basis in facts and law.”

The table below breaks down the costs owed to Eskom by City Power across four invoices from late March 2024.