Eskom

Electricity Minister Dr. Kgosientsho Ramokgopa has announced that the South African government is collaborating with provincial authorities to assist financially distressed municipalities in settling their debts with Eskom. This initiative aims to address the escalating financial crisis that threatens both the power utility and local governance structures.

In a recent meeting held in Bloemfontein, Minister Ramokgopa engaged with Free State Members of the Executive Council (MECs) to devise strategies ensuring municipalities fulfill their financial commitments to Eskom. The urgency of the situation is underscored by the staggering figures: municipalities nationwide owe Eskom approximately R100 billion, while these municipalities are, in turn, owed over R380 billion by various consumers. This financial imbalance poses a significant threat to the operational stability of both Eskom and the municipalities.

The Free State province exemplifies this crisis, with its municipalities collectively indebted to Eskom to the tune of R26 billion. This substantial debt has prompted immediate intervention to prevent potential power supply disruptions that could adversely affect residents and businesses in the region.

Municipalities at Risk of Disconnection

Four municipalities in the Free State—Nala, Moqhaka, Masilonyana, and Ngwathe—are on the brink of electricity disconnection due to a combined debt of R4.9 billion owed to Eskom. Eskom has issued notices to these municipalities, granting them approximately eight weeks to address their arrears or face the cessation of electricity supply. The affected towns include Bothaville, Wesselsbron, Kroonstad, Steynsrus, Viljoenskroon, Parys, Heilbron, Phiritona, Edenville, Vredefort, Koppies, Brandfort, Theunissen, Verkeerdevlei, and Winburg.

The financial obligations of these municipalities are staggering: Masilonyana owes R227 million, Nala R936 million, Moqhaka R1.5 billion, and Ngwathe R2.3 billion. Despite previous interventions and debt relief measures, these municipalities have struggled to meet their payment agreements, exacerbating the financial strain on Eskom and jeopardizing the stability of electricity supply to their communities.

Government Intervention and Strategic Measures

In response to this escalating crisis, the Free State provincial government, under the leadership of Premier Maqueen Letsoha-Mathae, has initiated an intergovernmental intervention. This collaborative effort involves all municipalities within the province and aims to develop sustainable strategies to ensure municipalities can meet their financial obligations to Eskom, thereby securing reliable electricity supply for their constituencies.

The seventh administration has demonstrated a commitment to fostering functional local governments capable of fulfilling their responsibilities. Many municipalities have been placed under Section 139 intervention of the Constitution by the Provincial Executive due to historical debts and challenges in paying Eskom for electricity distribution. The inability of municipalities to effectively collect revenue from debtors and maintain sustainable credit control has been influenced by various factors, necessitating a comprehensive intergovernmental dialogue to address these concerns.

Free State MEC for Cooperative Governance and Traditional Affairs, Saki Mokoena, emphasized the critical nature of the situation, noting that four municipalities are facing potential electricity blackouts due to non-payment. To avert this outcome, the province is formulating solutions in collaboration with the Minister of Electricity and Energy, Dr. Kgosientsho Ramokgopa. The interventions discussed include:

• Upstream Problem Management: Addressing systemic issues such as flawed billing systems that undermine revenue collection, leading to defaults on current accounts with Eskom.
• Implementation of Payment Plans: Establishing agreements and payment plans to prevent electricity cut-offs, with commitments from all affected municipalities to adhere to these plans.
• Revenue Refinancing: Assisting municipalities in restructuring the revenue generated from electricity to improve financial management and sustainability.
• Skill Enhancement: Bringing in the necessary expertise for maintenance and operations to ensure efficient service delivery.
• Smart Meter Installation: Deploying smart meters to reduce tampering and improve accurate billing, starting with bulk users and extending to individual households.

The installation of smart meters has commenced, particularly in areas like Maluti-a-Phofung, where bulk users have already been equipped. Reports indicate a payment rate of approximately 90%, demonstrating the effectiveness of this initiative in bridging the gap between usage and billing. Household installations are underway to expand this success. Additionally, efforts are being made to refurbish the electrical network to reduce incidents such as transformer failures, which have previously depleted municipal budgets.

Addressing Government Department Arrears

A significant contributor to the municipalities’ financial woes is the outstanding debt from various government departments for electricity usage. The provincial government has resolved to finalize payment plans in collaboration with municipalities to ensure timely settlement of these accounts. This initiative is not limited to provincial departments but also includes national entities operating within the province. The Department of Public Works is leading efforts to establish a sustainable payment framework, with the MEC for Finance, Ketso Makume, spearheading the process to ensure adherence to payment schedules and prevent the accumulation of further debt.

Political and Community Responses

The situation has elicited strong reactions from political entities and community organizations. The Freedom Front Plus (FF Plus) has demanded immediate action following Eskom’s indication of potential power cuts to the four indebted municipalities. The party has alerted MEC Saki Mokoena to the impending crisis, urging urgent intervention to prevent residents from bearing the brunt of municipal financial mismanagement. The FF Plus highlighted that all four municipalities had previously agreed to Eskom’s debt-relief program but failed to comply with its conditions, including the timely payment of current power bills. The party expressed concern that residents would suffer due to the municipalities’ substantial debts and called for accountability and effective financial management to prevent service delivery disruptions.

🔴 Central News Special Edition | Issue 94 🔴 Download the Latest Print and E-Edition | Headline: “I am a proud International criminal,
Malema Fires back at Musk and Trump”

Download Here:

Direct PDF Link:

https://centralnews.co.za/wp-content/uploads/2025/02/Central-News-Issue-094.pdf

Read all our publications on magzter:

https://www.magzter.com/ZA/Central-News-Pty-Ltd/Central-News/Newspaper/All-Issues

Central News also offers Sponsored Editorial Content, Podcasts , Radio / Social Media Simulcast, Video Production , Live Streaming Services, Press Conferences, and Paid Interviews (Video/Audio) etc.

We guarantee exceptional exposure, reach, and engagement, with an excellent return on investment.

Advertisement:

To place your advert on our platforms (Print Newspaper or Digital Platforms) : Please email : sales@centralnews.co.za

For Business Related:
business@centralnews.co.za

Newsroom:
Send your Stories / Media Statements To: newsroom@centralnews.co.za

General Info:
info@centralnews.co.za

Office Administrator:
admin@centralnews.co.za

Whatsapp / Call: 081 495 5487

Website: https://www.centralnews.co.za

Social Media Platforms (@centralnewsza) : Linkedin, Facebook, Tiktok, Twitter, Instagram, Youtube

centralnewsza #news