City Power has announced the signing of a memorandum of understanding (MOU) with Eskom to start the process of City Power taking over the responsibility of electricity supply to current Eskom-supply areas such as Soweto, Ivory Park, Orange Farm, Diepsloot and Sandton.
However, very few details have been disclosed except that City Power will “conduct its own due diligence study on Eskom’s infrastructure and assets in the areas… The due diligence study will consider, among others, the state and value of the infrastructure that would eventually be sold to City Power, [and] the outstanding debt owed by customers to Eskom”.
This alone implies that the ANC-led Johannesburg have no problem making the residents carry the cost for this takeover.
Under no circumstances, should the residents be forced into a situation of inheriting and paying for any of Eskom’s mess, such as Soweto’s ballooning debt, and the current state of Eskom’s infrastructure in their supply areas. The infrastructure in current Eskom-supply areas is in a terrible state, with regular breakdowns, leaving residents with outages for weeks on end.
Those residents can afford to pay for electricity must do so, while those who cannot afford to pay, must be referred to the City’s Expanded Social Package programme.
For City Power to inherit the debt and current state of infrastructure would collapse the municipal-owned entity within months. This could very well lead to further mass outages across the city and an eventual collapse of the municipal power grid.
While the DA supports in principle, the takeover of Eskom supply areas by City Power, this can only be done with an agreement where Eskom will undertake to resolve the debt owed to them, and repair and replace any ageing and broken down infrastructure in their supply areas.
Further to this, National Treasury would need to provide City Power with conditional grants during the years of the gradual takeover, so that City Power’s absorption of the current Eskom customers would not negatively affect the municipal entity’s financial balance.
A DA-led Johannesburg will not place the residents in any situation where they bail out Eskom’s mess. National government must take responsibility for the failures of their entity and not dare pass this buck onto the ratepayers of Johannesburg.
This is exactly why the DA supports local government taking control over electricity supply. The DA in Johannesburg wants to move away from relying solely on the failed Eskom model. Only once Eskom has upgraded their infrastructure in their supply areas, a DA-led City Power can take over and start opening up supply to a diverse pool of competitive independent power producers, so that residents can finally start being free of Eskom loadshedding, and the cost of electricity can start to come down.
Only a DA-led Johannesburg will get things done and keep the lights on in the City of Gold.