Power utility Eskom has reached an agreement with the City of Ekurhuleni on a payment plan to settle the outstanding debt owed to the utility by the city.

As part of the agreement, the city paid Eskom R1.7-billion of the R3.4-billion owed the utility, with the balance to be paid over 18 months.

This follows after Eskom on March 5 issued a Promotion of Administrative Justice Act (PAJA) notice informing the public of its intention to interrupt or reduce the bulk electricity supply to the city, as well as other municipalities with outstanding debt.

“The city acknowledges Eskom’s legal and governance obligations in safeguarding the sustainability of the national electricity supply system. Eskom has a statutory responsibility to ensure the financial sustainability of the electricity supply and to treat all customers equitably.

“Importantly, the city confirms that it remains fully committed to honouring its payment arrangement with Eskom, as well as the payment of future electricity accounts when they fall due”.

The parties say the payment agreement will be made an order of court and will conclude all active litigation between the parties relating to the bulk electricity supply.

The media release describes these payments as a significant step towards regularising the city’s electricity account and addressing historical obligations, while ensuring that current obligations are met in line with the agreed payment terms.

“Residents and businesses in Ekurhuleni are, therefore, assured that, owing to the above intervention and the agreed payment arrangement, there is no immediate risk of bulk electricity supply being switched off.”

The parties encourage residents to continue paying for municipal services, as revenue collection remains essential to maintaining and improving service delivery.