Huge municipal debt hampering Eskom’s ability to function: Ramokgopa

Reading Time: < 1 minute

Electricity Minister Dr Kgosientsho Ramokgopa says the huge debt that municipalities owe Eskom is hampering its ability to function at full capacity.

Municipalities owe the power utility over R60-billion.

Speaking during a weekly briefing on the implementation of the Energy Action Plan on Sunday, Ramokgopa says the municipal bill’s erosion of Eskom’s financials is making it difficult for it to respond to the failure of some substations and transformers.

“The top 20 municipalities alone they account for 77% of that debt, about R48 billion and the growth of this debt year to date is about R4.7 billion. So it means that we are adding more and more debt to Eskom and undermining Eskom’s ability to invest money in the generation, the transmission and also distribution.”

Electricity Minister media briefing on Energy Action Plan:

In June The National Council of Provinces (NCOP) approved Eskom’s Debt Relief Bill by 30 votes against 18, with no abstentions.

The Bill provides for the Treasury to give Eskom R254 billion over three years.

While some of the opposition parties argued that the bill will not address the challenges facing Eskom, the African National Congress (ANC) countered that it was necessary to bring the power utility’s debt to manageable levels.