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Eskom blamed for ‘human catastrophe’ in Lekwa and Ngwathe

Court to rule on limitation of electricity supply.
Gauteng’s main water source is being polluted by the raw sewage of half a million people, because of the parties’ inability to resolve their dispute. Image: Waldo Swiegers, Bloomberg

Eskom’s decision to restrict the supply of electricity to the Lekwa (Standerton) and Ngwathe (Parys) local municipalities has resulted in the raw sewage of 500 000 people polluting the Vaal River, which is the main water source for the whole of Gauteng.

This was one of the arguments forwarded on Tuesday in a digital hearing of the Johannesburg High Court, in support of applications to restore the electricity to previous levels. The two applications were heard together.

Eskom, on the other hand, maintained that it is merely acting in accordance with the electricity supply agreements with the two municipalities and that problems in this regard should be addressed to the municipalities.

The applications were brought by the Lekwa Ratepayers’ Association and the Vaal River Development Association respectively – against Eskom, the two municipalities, energy regulator Nersa, the minister of mineral resources and energy and the premiers and MEC for cooperative governance in Mpumalanga and the Free State.

Eskom was the only respondent to make an appearance.

Decade-old agreements

The court heard that both municipalities had concluded electricity supply agreements with Eskom a decade or more ago. The agreements stipulate the notified maximum demand (NMD) – the 30 minutes of highest use in a period of a month – for each municipality.

The purpose of the NMD is to assist Eskom in planning its electricity supply. Municipalities are not allowed to exceed the NMD without written permission from Eskom, and should they do so frequently a very punitive penalty regime kicks in.

In the past both municipalities have regularly exceeded their NMD and Eskom dealt with this by supplying the increased electricity demand and imposing the penalties.

Recently the utility however informed the municipality that it will now limit the supply to the contracted NMD.

This has left the two municipalities with an ongoing power shortage to the extent that they had to institute local load shedding. The towns of Parys and Vredefort in Ngwathe, for example, exceeded the NMD by 23.5% and 35% respectively before Eskom began to throttle their supply.

Eskom’s demands ‘impossible’ to meet

In terms of the NMD rules a municipality must apply to Eskom to increase the NMD as the demand grows.

The court heard that both municipalities did exactly that, but that Eskom would only agree if the municipalities paid all their arrear debt and even made large prepayments. This, according to the applicants, is impossible.

Acting Judge Anthony Millar was shocked to hear that Eskom charges municipalities interest on arrears at the prime interest rate plus 5%.

Ngwathe, for example, earns R12 million in electricity revenue per month, but its interest payments to Eskom alone amount to R10 million per month.

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Millar remarked that Eskom might have an incentive not to approve upward adjustment of the NMD, because doing so would cut off an income stream.

Public function obligations

The applicants argued that a municipality is merely a conduit for electricity supply and that Eskom performs a public function by performing its duties. It knows the electricity it supplies to the municipalities is reticulated to consumers and has an obligation to follow an administratively fair process before limiting the electricity supply to the two municipalities.

However, the utility only engaged with the municipality and not the residents on the matter.

The applicants argued that they are suffering because two organs of state – the municipality and Eskom – failed to use the appropriate mechanisms to resolve their disputes.

In terms of the electricity supply agreement between the parties, disputes should be referred to arbitration. The other option open to them is to involve Nersa, which has the legislative powers to resolve disputes between its licencees.

The applicants asked the court to end the “human catastrophe” that impacts residents by ordering Eskom to restore the status quo.

Infrastructure is available

The infrastructure at the points of service is available and Eskom can do it, the applicants assured the court.

Advocate Makhosi Gwala, acting on behalf of Eskom, informed the court that his client had an apprehension that Millar is biased against Eskom and applied for the acting judge to recuse himself.

Millar refused the application and said that while he made remarks while the applicants presented their case, he was open to hearing Eskom’s arguments.

Eskom argued that the power underlying its decision to limit the electricity supply to the two municipalities is derived from the contract it has with them and that the obligation to provide basic municipal services lies with the municipalities, not with Eskom.

The court may not interfere with the contract and substitute the content, which is what the applicants want, Gwala said.

Negotiating process

He denied the existence of any intergovernmental dispute, saying Eskom put its conditions for increasing the NMD for the two municipalities on the table as a first move in a negotiating process and the municipalities did not respond. The process has therefore not been concluded and there is no certainty as to what the final position may be.

Gwala said Nersa’s NMD rules make it clear that exceeding the NMD puts the electricity grid and other users at risk, which is proven by the fact that one of the transformers serving Parys has been damaged.

He said to increase the NMD would require infrastructure upgrades, at a cost of R187 million for Lekwa and R4.5 million for Parys. The municipalities have to pay that as well as their arrear debt before the supply can be increased.

Gwala further argued that the reason for Ngwathe’s increased electricity use is illegal connections and that by increasing the NMD, Eskom would be accommodating electricity theft.

Millar reserved judgment but said he would try to give his ruling before the end of the week.

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Wonderful commie dreamworld turbocharged with RSA typically corruption: Supply according to our needs – Payment according to our non existing willingness and ability. Viva – what could go wrong ?

The high interest rates that Eskom charge is unreasonable in the current economic climate and cause for concern.
However, employees at municipalities are incapable, incompetent and corrupt. Hence basic service delivery issues cannot be addressed and executed in a responsible way.

George Reisman said that:
“Under Communism (socialism), there is no incentive to supply the people with anything that they need or want, including safety.”

Is this not exactly what is happening here? Peoples lives are on the line yet the government is hell bent carry on with this sick social experiment.

Government Against the Economy George Reisman – Free PDF Book
https://b-ok.asia/book/769111/6ef73a?regionChanged=&redirect=11337661

How to shoot your population through courtesy of ANC corruption and mismanagement.

Enough cANCer… Municipalities will be better-off if run by no-one compared to the ANC…

This is what it looks like when your right to clean and healthy drinking water meets your right to free electricity and sewage works. Socialism is aptly illustrated as sewage in the drinking water. The sewage belongs to the collective, as the water belongs to the collective. So, they simply mix everything they own, and turn it all into …… yes you guessed it.

I wonder if government has ever investigated the possibility of paying Eskom directly for municipalities electricity bills and deducting that from each municipality’s annual budget from national government (if there is such a thing or enough of it), thereby forcing municipalities to make more effort to bring in revenue in order to have money for everything else, including looting?
I realize this may be a dumb idea, as I don’t know how municipal finances work (though, most municipalities don’t appear to either), but maybe anything would be genius by comparison to the seemingly nothing that is happening about this perennial problem.

My electricity supply is conducted via a pre-paid electricity meter, and she’s the best thing since sliced bread (when there’s no load shedding).

As far as I know, she never lies, is not corrupt, and treats me fairly. I cannot complain.

I keep a close eye on her KWh’s (that is directly proportional to my own consumption!), and when she needs topping up, I top her up. It couldn’t be simpler.

Is it possible to bypass the meter? Then the meter will lie.

Just check when you load your electricity that the number of units go up by the amount you paid for. I had a meter where I loaded say 300 units and it only recognised say 20.

The municipality will deduct o/s (other) fees when you load prepaid – this could explain why you see what you see.

I note that the Premiers and their CoGTA MEC’s did not make an appearance. They are absent on an issue that is their responsibility. They all have oversight roles in this case and should never have allowed this situation to develop to this point. Their Councillors and deployed officials, who were directly responsible for this mess, should have been disciplined right at the beginning when the first Eskom account was in arrears. Now they do not even show up. What a disgrace!

Did anyone notice that “the two municipalities, energy regulator Nersa, the minister of mineral resources and energy and the premiers and MEC” did not even attend the hearing of the Jhb high court?

There is something seriously wrong if they can get away with not even attending the court hearing. Don’t expect them to take the needs of ‘Joe Soap’ seriously if they ignore the court.

One has to look up in awe at these cadres (whether in government or muni’s) there is always someone else to blame. I wonder if this is their only real ability – to shift the blame away from their own incompetence. That old phrase comes to mind “Stupid is as stupid does”

Thank you – PurgeCoin , for that info.

At last Eskom is doing the right thing in areas where they put up illegal connections. And refuses to negotiate with Soweto where arrears are of the highest in SA – the courts should STOP allowing municipalities to get away with murder! They should employ skilled people and do proper debt collecting!
All Eskom needs to do in this case is charge municipalities lower interest on arrears!
And in towns where factories abide by the law by paying for their industrial power to Eskom, they should ensure Eskom AND the municipality refund losses they suffer due to load reduction.

These municipalities are a template for the whole country going forward.

It’s called collapse. Thanks to corruption, prices are too high for consumers. So Meters are by-passed and power is stolen.

Corruption in the municipality means its cost base is also far to high…and it becomes another cost passed on to consumers.

Enter the lockdowns where the govt has totally devastated consumers, and the whole situation becomes impossible. Costs are way too high for consumers.

Eskom gets on its high horse and dishes out the pain. So do municipalities who cut consumers off.

Cut their bloated, overpaid, corrupt and underworld staff? Never

And that’s how we get sewage in our drinking water.

And it can only get worse

Years of corruption and looting by the ANC has gutted South Africa. Our SOEs, cities and towns are ceasing to function. Eskom can’t continue to provide a service to non-paying municipalities who owe billions of rands. These municipalities owe billions of rands in debt to Eskom. Voters must ask what happened to all the money that they paid but never reached Eskom. It was plundered and looted by corrupt politicians. Next year there will be local elections. Hopefully now that Eskom is cutting electricity off to municipalities it will make the majority of residents think twice before electing the same old corrupt politician into power again. If not, then they deserve no sympathy.

End of comments.

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