PRETORIA - South Africa may have turned a corner on load shedding, but Eskom is facing another major challenge.
Municipalities across the country owe the power utility about R450 billion, according to Electricity and Energy Minister Kgosientsho Ramokgopa.
The growing debt is putting severe financial pressure on Eskom and raising concerns about the future stability of South Africa’s electricity market.
After years of load shedding, Ramokgopa said South Africa now has surplus electricity-generation capacity.
The minister said the interventions made to stabilise the power system have delivered the long-term gains government had anticipated.
“We fought load shedding, we have always been confident about our ability to resolve load shedding,” Ramokgopa said.
He said the country is now experiencing the benefits of those interventions, with electricity generation exceeding current demand.
But the improvement in supply comes with a new set of challenges.
Ramokgopa said Eskom is once again being forced to intervene on the distribution side of the electricity market.
A major concern is the continued increase in municipal debt, including municipalities with electricity distribution licences that are struggling to collect payments from customers.
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According to the minister, the debt has reached approximately R450 billion.
He warns that the situation threatens not only Eskom’s finances, but also South Africa’s broader electricity-market reforms.
“This is a threat to the South African electricity energy market. It’s a threat for the reform agenda that we are introducing,” Ramokgopa said.