Pretoria – The City of Tshwane on Wednesday owned up to the R1.4 billion that it owes Eskom and insisted it was committed to clearing the arrears.
Earlier, the struggling power utility said: “The City of Tshwane’s electricity debt has compounded to a bulky R1,4 billion as of today (25 January 2023), due to its short payment and non-payments spanning several months in the recent past”.
Eskom, which is facing protests over its persistent load-shedding, said the City of Tshwane short-paid its November 2022 bill of R660 million and also failed to pay its December 2022 account of R780 million, negatively impacting the liquidity, financial performance and sustainability of the power utility.
Responding to Eskom, Peter Sutton Tshwane MMC for Finance said: “We acknowledge the R1,4 billion arrear debt and we intend to make regular payments to service the account.
“Our finance team has consistently been engaging Eskom on a payment plan.
“As a City, we understand our responsibility to pay our creditors and it is for this reason that we continuously communicate with Eskom with a proposed payment plan to bring the account up to date.
“The City has been open and honest about its liquidity challenges, and we are currently implementing various interventions to address these financial challenges.”
Eskom said it has approached the department of Cooperative Governance and Traditional Affairs to “mediate in the resolution of the Cty of Tshwane’s poor payments that continue to spiral out of control”.
Eskom said its ability to continue to supply the city with electriciy depended on agreed payments.
Eskom said, “it does not have the financial capacity to finance the City of Tshwane operations”.
The power utility called on the City of Tshwane “to do the right thing by its residents and pay the bulk electricity account to enable Eskom to continue supplying electricity to the city”.
In its defence, the City of Tshwane said Eskom’s load-shedding has an adverse impact on its “liquidity position”.
City of Tshwane Finance MMC, Suttton, said: “Our maintenance budget is spinning out of control as a direct impact of load-shedding, but Eskom refuses to take responsibility for this.
“Furthermore, our residents and business are battling economically due to load-shedding, which in turn contributes to low revenue for the City.
“In addition to these challenges, Eskom is proposing an 18% increase which will further cripple the financial position of the City as we will not be able to pass that increase onto end users until 1 July 2023.”
Sutton said the City of Tshwane remains committed to paying “what we owe and ensuring that we service our Eskom accounts”.