Eskom and City Power have come to a consensus on initiating an independent review of longstanding billing disputes. The resolution follows the intervention of South Africa’s Minister of Electricity, Dr Kgosientsho Ramokgopa, who brokered the agreement to prevent a potential power supply disruption to the metropolitan area. This intervention has temporarily halted the escalation of tensions and postponed the legal battle over City Power’s outstanding debts, an accumulation that includes both longstanding and current liabilities amounting to billions of rands.
The dispute surfaced prominently last week when Eskom issued a formal notice of potential service interruption, citing an outstanding debt of R4.9 billion in historical arrears alongside a current debt of R1.4 billion owed by City Power. Responding to the notice, City Power contested Eskom’s billing methodology, alleging discrepancies in meter readings and asserting that the utility had been overcharged. In a statement, City Power argued that such a notice was unnecessary as the dispute was already under judicial review.
Prompted by the risk of power disruptions and the complexity of the dispute, Dr Ramokgopa, in concert with Johannesburg’s Executive Mayor, Dada Morero, intervened to facilitate negotiations. Speaking at a media briefing at the Joburg Theatre, Ramokgopa clarified that the intervention did not seek to introduce a new dispute resolution mechanism but rather to reinforce the existing processes by pinpointing areas of misalignment.
Central to the resolution is the decision to appoint an independent technical review, which will be led by the South African National Energy Development Institute (SANEDI), with technical representatives from both Eskom and City Power supporting the process. This independent review, expected to conclude within the next fortnight, aims to yield an objective assessment of the billing figures. Dr Ramokgopa noted that findings from the review would be presented by the appointed expert on November 25 to both utility teams, alongside the minister and Mayor Morero, in a bid to reach an evidential basis for future billing agreements.
Meanwhile, as part of the agreement, City Power has committed to settling its current account balance of R1.4 billion by the end of the month, a financial obligation that Eskom cited as a primary driver behind the issuance of last week’s notice. Eskom’s threat to cut off supply, however, has since been withdrawn in light of City Power’s commitment to the payment deadline.
The financial strain caused by unpaid utility debts is not unique to Johannesburg, Ramokgopa observed, noting that several municipalities are grappling with similar fiscal challenges. Such challenges stem from revenue generation difficulties, which have impaired consistent payment flows to the national power utility.
City Power CEO Tshifularo Mashava acknowledged the enduring nature of the billing inconsistencies, which she noted originated in 2019. Despite recurrent discussions aimed at reconciling the issues, both entities have found themselves unable to fully resolve the contested charges. Mashava expressed optimism that the upcoming independent assessment would provide the impartial analysis necessary to establish clarity on City Power’s liabilities and to facilitate more transparent future interactions with Eskom.
In a related statement, Mayor Morero echoed this sentiment, noting that the recent meeting with Minister Ramokgopa has enabled City Power and Eskom to pinpoint specific operational issues requiring attention. He highlighted the need for concerted focus on meter accuracy and meter-reading protocols to prevent recurrence of such disputes in future. This collaborative approach, Morero emphasised, should serve to stabilise the metropolitan power supply and preclude future threats of service interruption.
The commitment by both parties to engage an independent evaluator marks a step towards resolving a complex, protracted billing dispute that has threatened Johannesburg’s energy security. With the forthcoming assessment report, stakeholders are hopeful for a lasting resolution that ensures financial transparency and operational continuity for the city’s residents.
