Eskom yesterday threatened to disconnect power supply to the City of Tshwane for failing to settle its debt of R1.6 billion, which was due and payable on August 17.
The power utility said it was considering disconnecting the metro “as one of the necessary steps to secure the outstanding payment”.
“The City of Tshwane is in breach of the Electricity Supply Agreement which it holds with Eskom by failing to pay the R1.6bn which was due and payable on 17 August 2022. The City only paid R68 million to date, which did little to dent the massive outstanding balance on its electricity account,” Eskom said.
According to the power utility, numerous engagements with the City’s management to ensure that the payment was made have not yielded positive results.
“The inconsistent payments are both untenable and unacceptable since Eskom’s financial position is well known. The City’s persistent failure to honour its payments places a huge burden on Eskom to continue providing it with electricity,” it said.
Tshwane MMC for Finance, Peter Sutton, acknowledged Eskom’s unsettled amount of R1.6bn, adding that the municipality intended to service the amount.
“Our finance team has consistently been engaging Eskom on a payment plan. We understand our responsibility to service our account,” he said.
Sutton said the amount owed was only four days in arrears and that the outstanding amount only related to July and all prior debt was paid.
“Our entire value system is not aligned. Eskom payment date is in 15 days (16 August). Tshwane invoices for July are payable around 21 August. On average residents pay the City in a 60-day cycle for services consumed while Eskom expects payment in 15 days and the City has zero cash reserves to bridge the gap with payment from our coffers and therefore this results in the current situation,” he said.
He said the City would continuously engage Eskom on the payment plans.
“We have previously met with the Eskom CEO and CFO and discussed the city’s financial challenges, so we note this Eskom statement with disappointment. The City of Tshwane remains committed to paying what we owe and ensuring that we service our Eskom accounts. This is why we have embarked on our aggressive revenue collection campaign to ensure that we collect enough revenue to service our creditors like Eskom,” Sutton said.