Joburg’s plan to take over Eskom areas should remain in the dark, say experts

Johannesburg’s plan to take over electricity supply from Eskom-owned areas in the city is a recipe for disaster.

This was said by experts on Tuesday after Joburg mayor Geoffrey Makhubo said City Power was exploring the “feasibility of alternative” energy sources to diversify its energy mix.

“This has a potential to address some of the electricity supply constraints, as well as ensuring all communities are provided with reliable and continuous energy supply to improve quality of life and contribute positively to economic development,” Makhubo said while delivering his state of the city address. 

During his speech he mentioned that the city was in discussions with Eskom to take control of its areas.

Some Eskom-owned areas include Sunninghill, Soweto, Orange Farm and parts of Sandton and Bryanston.

“We continue to engage with Eskom to find a lasting solution to the electricity supply crisis in Soweto and surrounding areas,” Makhubo said. 

But energy expert Ted Blom said this was not the first attempt by the city to take over the areas.

Previous attempts failed due to the unavailability of funds, he said.

Soweto’s non-payment is more than R2bn to R3bn a year and Soweto is a nightmare because the metering is like a spider’s web and it’s a total mess. I don’t think the city has the competency to take on more disasters.

—  Energy expert Ted Blom

Blom said the council also did not have the money to fund Soweto’s non-payment.

“Soweto’s non-payment is more than R2bn to R3bn a year and Soweto is a nightmare because the metering is like a spider’s web and it’s a total mess.

“I don’t think the city has the competency to take on more disasters. I don’t think the city has the competency to take over and fund Soweto and to fix up the billing nightmare in Soweto.

“The same goes for the billing nightmare in Sandton. All that is happening is that it’s a political move and it is just changing the chairs on the Titanic,” Blom said.

Energy analyst Chris Yelland said City Power also warned that taking over Eskom-owned areas could pose financial challenges for Johannesburg.

If City Power were to take over areas such as Soweto and Orange Farm it would place a big financial burden on them, Yelland said.

During his address, Makhubo said despite the economic disruptions caused by Covid-19, his city had performed well in terms of revenue collection.

“Despite the challenging institutional and macroeconomic environment due to the pandemic, the city managed to collect 86.3% of the revenue, against an adjusted Covid-19 risk target of 88% for the 2019/20 financial year, as well as acquired a surplus of R3.7bn for 2019/20.

“Encouragingly, the city still collected more revenue by 6%. Furthermore, the city’s financial position is in solid standing, with total assets increasing by 5%. The city has remained focused on continuously strengthening its financial position, while actively pursuing the achievement of its service delivery goals,” he said.