By Lehlohonolo Lehana.
Caption: Agnes Mlambo, the Acting Group Executive for Distribution, delivered the keynote address at T&D Africa 2026. Image: Eskom.
State owned power utility Eskom has issued legal notices to around 14 municipalities that have failed to pay their electricity bills, warning that it may interrupt their power supply.
Last year, Eskom revealed that 87% of municipalities approved for the National Treaury’s municipal relief program are failing to meet the conditions required for debt write-offs, with only 10 out of 71 municipalities remaining compliant. Municipal debt to Eskom has now surpassed R110 billion.
The municipal debt relief program was introduced by the National Treasury in 2023 to help municipalities reduce the large debts they owe Eskom. It offers debt write-offs if municipalities pay their current bills consistently and meet certain conditions.
In a statement, Eskom said it had begun the process of issuing notices in terms of the Promotion of Administrative Justice Act (PAJA) to provide an opportunity for affected parties to make representations before further action was taken.
Eskom also invited written submissions on alternative solutions and said it would communicate the way forward once it had considered all representations made through the PAJA process.
While not immediately naming the municipalities, it said they had been selected because they had either not settled their accounts for at least 18 months, had not met the conditions of the National Treasury municipal debt relief programme, or posed a significant financial risk to Eskom.
The 14 municipalities are believed to be among the 71 municipalities that have signed up to the National Treasury’s debt-relief programme, but which are not meeting the conditions.
“We have to address rising arrear debt to protect the operational stability we have restored and the financial discipline we have rebuilt in the first three years of our turnaround to deliver on our developmental mandate,” acting group executive for distribution Agnes Mlambo said.
She warned, too, that escalating municipal debt had wider implications for South Africa’s electricity reform agenda, and was already delaying the legal and operational unbundling of Eskom’s Distribution business.
“Should the municipalities fail to take corrective action, Eskom will proceed with credit control measures, which may include interrupting electricity supply at predetermined times, as permitted by law.
“If defaults persist, Eskom will be compelled to limit supply to levels commensurate with payments received,” the power utiliy said.
The move follows confirmation during the 2026 Budget that the National Treasury would support Eskom in its pursuit of Distribution Agency Agreements (DAAs) with municipalities that owe the utility money, including those that have signed up to the municipal debt relief programme, but which are in default.