South African city lost nearly R5 billion worth of electricity in a year

Johannesburg power utility City Power lost nearly R5 billion of the electricity it purchased from Eskom in the 2023/24 financial year, EWN reports.

Most of the losses were due to illegal connections, faulty meters, and billing errors.

However, City Power CEO Tshifularo Mashave recently noted that ageing electricity infrastructure results in power losses due to heat or suboptimal design.

She added that replacing City Power’s ageing infrastructure would be a long and costly process.

The AG’s report shows that City Power recorded electricity material losses of R4.9 billion during the financial year, representing around 30% of all electricity it purchased from Eskom in the year.

Another revelation from the AG’s report was that City Power spent R4.8 billion irregularly, which the AG says was due to senior management failing to monitor internal financial controls.

It also said the power utility recorded R150 million in wasteful and fruitless expenditure, resulting from late payments to Eskom.

Additionally, the AG found that City Power paid R12 million to a politically connected contractor before they had done any work.

Democratic Alliance (DA) councillor and Johannesburg caucus leader Belinda Keyser-Echeozonjoku said the party has long raised the alarm over City Power’s senior management’s incompetence.

“The DA in Johannesburg is vindicated as reports emerge that City Power has paid R12 million to a politically connected contractor before any work had been done at all,” wrote Keyser-Echeozonjoku.

“The DA has again written to the Auditor General, the Department of Cooperative Governance and Traditional Affairs and National Treasury to urgently intervene in Johannesburg’s continued governance crisis.”

A factor contributing heavily to City Power’s electricity losses is illegal electricity connections, through which customers bypass their meters to avoid paying for electricity.

City Power has been conducting cut-off operations on illegal connections across the city to address this.

These operations led to the disconnection of 122 prepaid meters and the removal of 150kg of aluminium wire valued at over R500,000 on two days in January.

Operations on the first day focused on illegal connections in City Deep, an industrial suburb in Johannesburg.

City Power said the raid directly responded to frequent reports of meter tampering and illegal electricity use in the area.

“Acting on a tip-off from Joshco management, the City Power Revenue Protection unit conducted a meticulous intervention, resulting in the disconnection of 122 prepaid meters and the removal of 114 circuit breakers,” it said.

The power utility fined residents who tampered with their meters more than R14,000 for single-phase connection.

“We will continue collaborating with law enforcement to combat criminal activities like illegal connections, which not only endanger lives but also compromise the availability of reliable electricity services,” said Inner City Customer Services Manager Maphuti Makgabo.

The City Deep operation followed similar action that took place in Region G a few days earlier. Tip-offs mainly related to illegal connections at the Johannesburg Social Housing Company (Joshco) flats in Kliptown Square.

Working with law enforcement, City Power disconnected the electricity supply to more than 120 units.

“We are also investigating leads provided by some of the customers we’ve disconnected, who allege that our contractors and staff members are involved in illegal reconnections,” said City Power spokesperson Isaac Mangena.

“We’ll be making arrests very soon.”