Piet Retief – The Mkhondo Local Municipality (Piet Retief) in Mpumalanga says it has reached a settlement agreement with Eskom on how to pay its outstanding electricity bill of more than R400 million.
The agreement was reached on Tuesday after a marathon meeting between Eskom executives and the municipality’s leadership.
Just before the meeting took place, the entire municipality on the southern tip of Mpumalanga was plunged into darkness for six hours.
That period of darkness sparked fears within the business community that Eskom had grown tired of the debt and wanted to have it recovered by any means necessary.
On Tuesday night, the municipality issued to residents and informed them that the power has been restored.
“Whilst waiting for the meeting to start Eskom switched off the whole town without notice, this was exclusively out of personal emotions and very unexpected. As a result the whole of Mkhondo was without electricity for approximately six hours.
“The municipality and Eskom eventually came to an agreement and power was restored on basis that the municipality will make payments in consideration of R10m monthly collections on average where operational costs and overheads costs necessary to provide electricity supply,” the municipality said.
It added that there have been talks to increase capacity for densely populated places like Thandukukhanya township.
“The meeting looked at increasing the NMD from 18MVA to 40MVA in Mkhondo town and from 1.9 to 2.5 in Amsterdam.
“Alternatively to construct two substations, one for Thandakukhanya and one for Amsterdam where these are under consideration by relevant stakeholders amongst whom are Department of Energy, Nersa and Eskom.
“The municipality is moving swiftly to address the current crisis and further sincerely apologizes for the inconvenience that have been caused by the incident.”
Acting municipality manager Bheki Maseko then confirmed that they have agreed with Eskom through their debt by making three annual payments.
“Today we had a meeting with Eskom Executives and yes on R25m repayment plans three times a year and payments towards current accounts.
“The meeting also noted that Eskom bills municipality R18m per month, while the municipality bills R10m which leaves R8m deficit of that costs of labour overheads expenditure for running the electricity operations as well as the depreciation of infrastructure not counted. Regular and huge maintenance costs due to ageing electrical infrastructure.
“The meeting noted legal proceedings against each other and deemed those and related costs as unnecessary,” Maseko told IOL.
sihle.mavuso@inl.co.za
Current Affairs