NEVA MAKGETLA: Eskom punishes without understanding why municipalities can’t pay
The electricity utility blames a ‘culture of nonpayment’, but the causes are economic not cultural
Over the past decade Eskom’s revenue as a percentage of GDP has doubled from 1.9% to 3.8%, while its electricity sales fell 15%, because electricity tariffs more than doubled in constant rand. Meanwhile, the utility has sought increasingly harsh measures, including shut-offs and impounding resources, to make municipalities pay up if they fall behind on their electricity payments. Its actions have flown in the face of a core promise of democracy: in contrast to apartheid, basic municipal services will be extended to all citizens equally, wherever they live.
Eskom argues that it has to squeeze more from municipalities because its own expenses have soared. To start with, domestic coal prices have escalated in large part because mine operators have managed to reclaim the rents that historically constituted a core advantage for SA industry. In addition, Eskom is paying for its misguided technology choices, faulty engineering and state capture over the past decade...