The Metsimaholo Local Municipality stands out as the only one of the 19 municipalities in the Free State not indebted to Eskom.
The financial predicament of Free State municipalities resurfaced with the new municipal financial term starting this month of July.
Eskom revealed the coalition-run Metsimaholo had a clean bill of health, having settled its overdue account and servicing his current account. While the Mangaung Metro, Moqhaka, Mantsopa, Setsoto and Maluti-a-Phofung have settled their current accounts, they are among defaulters owing the entity billions in overdue accounts.
Stefanie Jansen van Rensburg, Eskom provincial spokesperson, said the debt of the 16 defaulting municipalities had stood at R16 billion at end of May. This is for bulk supply.
She said Phumelela had an active partnering agreement with the entity, while Setsoto and Mangaung were under administration and had payment plans in place. Some municipalities have paid substantial amounts towards their overdue accounts, but still face blackout due to failure to service their current accounts.
“Moqhaka is in the process of concluding a payment plan and is waiting for a council resolution,” said Jansen van Rensburg.
She lamented the bad debt obstructing the entity’s ability to fulfil its obligation of supplying power without disruption, and it also having a negative impact on cash flow.
Municipalities in the Free State are notorious for breaching the Intergovernmental Relations Framework agreements they have entered in with the power supplier over the years.
According to Eskom, Maluti-a-Phofung, Matjhabeng and Ngwathe have high consumption, at R200 million (97 GWh) of energy on average monthly. Desperation to meet demand has led to Ngwathe overloading the network, which tripped and damaged equipment on Friday (01/07).
The cash-strapped municipality was forced to pay R1,1 million for repairs and to restore supply.
“Since 2018, Eskom has warned Ngwathe that its continued exceedance of its Notified Maximum Demand (NMD) – the contracted amount of electricity supplied by Eskom to the municipality – would eventually result in damage to the network, and that the municipality needed to apply for an upgrade in its NMD,” said Jansen van Rensburg, adding that Ngwathe’s overdue debt stood at R1,89 billion.
Municipalities with overdue debt, and yet to make payment arrangements, are as follows:
Maluti-a-Phofong: R6524 901 678
Matjhabeng: R4575 965 943
Nketoana: R520 871 700
Mafube: R122 376 556
Nala: R529 065 477
Mantsopa: R252 698 367
Masilonyana: R114 789 015
Tokologo: R164 557 315
Dihlabeng: R683 106 666
Tswelopele: R61 328 288
Letsemeng: R116 798 998
