Lesedi municipality non-payment a ‘financial strain’ – Eskom

Eskom has lodged a dispute against Lesedi Local Municipality as a result of the municipality’s failure to service its R125 million debt.

According to Eskom, the municipality began to default on payments in June last year and says it has exhausted “all avenues” to recover the debt.

“In January 2023, Lesedi submitted a payment proposal to Eskom to settle the arear debt, which Eskom accepted on condition that it would continue to service its monthly current account.

“However, the municipality defaulted on both the repayment and the current account by failing to settle the April 2023 invoice of R20 million that was payable on 29 May 2023, and only paid R7 million.

“The May 2023 invoice of R21 million, which was due on 29 June 2023, remains unpaid. Eskom has issued the June 2023 invoice of R38 million and that is payable on 27 July,” the power utility said.

Eskom has struggled to recover monies owed and regular payments from municipalities. Municipal debt for bulk electricity supply had ballooned to at least R56 billion by December 2022.

This, Eskom said, is hampering its ability to deliver on its mandate of supplying electricity to the country.

“Failure to service debt by Lesedi and other local municipalities burdens the power utility’s revenue streams, ultimately affecting service delivery. This puts further strain on Eskom’s finance and its ability to operate effectively,” Eskom said. – SAnews.gov.za