Eskom Enters Active Partnership Agreement with Msunduzi Municipality to build Capacity and Curb Spiralling Debt

  • Eskom has entered into an Active Partnership Agreement with the Msunduzi Municipality (formerly Pietermaritzburg), in terms of which Eskom has been appointed as Network Maintenance Services agent plus they will assist the municipality with capacity building and skills transfer.
  • This three-year agreement is the first in a series of Active Partnership Agreements that Eskom will be entering to in order to assist municipalities rebuild their internal technical and administration capacities, and to boost revenue collection.
  • Eskom is owed more than R35.3 billion by municipalities across the country. 

Through these agreements, Eskom hopes to help contribute to the rebuilding of municipal capacity in order to increase the municipalities’ ability to deliver on their constitutional obligations of service delivery to their communities. This Active Partnering with the municipalities will also assist Eskom collect revenue from the sale of bulk electricity to the said municipalities, and to help arrest the spiralling municipal debt, which stood at more than R35.3 billion as at the end of March 2021.

“Through these Active Partnership Agreements, Eskom acknowledges its role to sustainably supply bulk electricity to the municipalities, and to do everything it can to assist the municipalities to meet their obligations to the people of South Africa,” said Monde Bala, Eskom’s Group Executive for Distribution. “Key among these obligations is the requirement by all parties, including the municipal customers, to keep their end of the bargain by paying for services provided and for electricity supplied.”

In terms of the agreement with the Msunduzi Municipality, priority will be given to the maintenance and upgrade of the municipality’s distribution network, including the maintenance and upgrade of substations.

For its services, Eskom will invoice the municipality accordingly, and the municipality will reimburse Eskom for all costs incurred. The municipality and Eskom are in talks for a possible increase in the scope of the agreement to include account management, billing systems and revenue collection.

Author: Bryan Groenendaal

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