Minister of Energy and Electricity Kgosientsho Ramakgopa has found the silver lining in Johannesburg’s electricity debt woes.
Ramakgopa stated on Tuesday, while standing on the steps of City Power’s head office, that if they could solve Johannesburg’s electricity issues, they could fix any municipality in the country.
The minister was joined by Johannesburg mayor Dada Morero in announcing a preliminary agreement that would see Eskom assist the municipality with a host of technical and skills issues.
Ramakgopa stopped short of calling it a Distribution Agency Agreement (DAA), but suggested it would be in all but name.
“What we have agreed to meets all the parameters of being designated as a DAA, which is what the technical teams will be discussing,” he said outside the Reuven offices.
Fixing City Power
Ramakgopa said there was a need to address the “entire value chain” within City Power; most notably technical losses and billing failures.
Morero thanked the minister, declaring the meeting had achieved its objectives in establishing common ground.
Both explained that teams from Eskom and the municipality would now work together to finalise a formal agreement.
“They will be starting to work immediately to try and sort out these issues, but we are confident that we will resolve all the issues and help City Power to get where it should be,” said Morero.
Johannesburg’s team will be led by those currently in charge: acting City Power CEO Charles Tlouane and City Manager Floyd Brink, with Eskom’s team yet to be confirmed.
Citing City Power’s importance, Ramakgopa and Morero were confident a turnaround strategy could be devised.
“The value of this meeting was that we have been able to find each other. We have agreed on the broad principles, and the teams will work on the basis of those broad principles so that we avert a catastrophe,” said the minister.
‘Now we are tied at the hip’
The pair explained that the recovery plan would address technical losses, address capacity shortages and focus on accurate billing and revenue collection.
Additionally, a portion of Johannesburg’s revenue collection would be guaranteed to go towards the recovery plan.
“Electricity has been provided; it must be paid for. As is the case across the country.
“We have already committed as part of the reform agenda that by the beginning of July there is going to be a ring-fenced account for City Power,” said Ramakgopa.
The minister stated that the city would not be absolved of responsibility in this matter, saying there was a “gravity” associated with the city’s situation.
“The spirit of the meeting and the letter of the agreement will confirm this, and it will show you what it is that we are doing differently.
“As opposed to an arms-length relationship, now we are tied at the hip to resolve this problem,” Ramakgopa said.
