KEVIN FOSTER: Municipalities central to Eskom’s debt and just energy transition
Power utility’s woes mainly involve a handful of its local government customers
There is a fundamental misunderstanding of Eskom’s debt. We hear and read regularly that “municipalities” owe Eskom R50bn, and that this number is surging. The misunderstanding is what municipalities are. To Eskom, they are a category of customer (it’s called “distribution” in its annual report).
“Municipalities” is its biggest customer category by a long shot, twice as big in terms of electricity sold than its next biggest customer category, industry, consuming about 10% more than mining and industry combined. But in reality, “municipalities” are 256 separate local governments, about 160 of which are licensed electricity distributors. ..
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