Lights for debt: Eskom gets go ahead to cut power – court rules

By Lameez Omarjee

Pretoria – Eskom may cut off power supply to eight municipalities as a means to recover outstanding debt, the North Gauteng High Court heard on Thursday.

Judge Hans Fabricius made the ruling on an urgent matter submitted by civil rights group AfriForum, which sought to stop Eskom from cutting power. The application by AfriForum was dismissed with costs.

“Muncipalities ought to be held accountable,” said Fabricius.

Eskom said on Wednesday that it would delay turning the lights off in the affected areas from Thursday until next week Tuesday.

Among the main arguments presented by AfriForum was that there is still an outstanding matter to be heard on 22 and 23 March, relating to Eskom’s authority to cut power supply to municipalities.

The civil rights body claimed that cutting power supply as a means to get municipalities to pay off debt would have unfair consequences for ratepayers.

However, Fabricius noted that Eskom does not have an obligation to supply electricity to ratepayers. The obligation to provide basic services lies with municipalities.

Acting Eskom CEO Matshela Koko

Previously, Eskom acting CEO Matshela Koko told Fin24 that rising debt by municipalities was one of the contributing reasons Standard and Poor’s downgraded the power utility’s credit rating, which is now one notch above non-investment grade (junk status).

Eskom’s legal team argued that the parastatal had been trying to settle the debt issue since 2011. Eskom also argued that it was entitled to terminate power supply according to the Electricity Regulation Act of 2006 and its written agreements with municipalities.

Koko added that AfriForum’s decision to submit the interdict was “nonsensical” and politically motivated. “They are fighting a political fight. I have a job to do… My job is to give power.”

Marcus Pawson, head of local government at AfriForum, previously told Fin24 that the electricity cut does not solve Eskom’s debt collection issue. “Eskom does not get the money back.”

Instead, the parastatal should meet with National Treasury to find a means to deal with efficiencies for municipalities to comply with their obligations, he said.

The eight municipalities are Thembelihle (Northern Cape), Moqhaka (Free State), Mailonyana (Free State), Nkentoana (Free State), Mantsopa (Free State), Tokologo (Free State), Nala (Free State) and Dihlabeng (Free State). – News24

Source: http://www.fin24.com/Economy/Eskom/breaking-eskom-can-turn-off-the-lights-court-rules-20170105

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