Electricity and Energy Minister Dr Kgosientsho Ramakgopa has confirmed that an independent technical assessment of the R6.1-billion billing dispute between State-owned utility Eskom and the City of Johannesburg’s (CoJ’s) wholly-owned electricity utility City Power will be carried out over the next 14 days.

Upon conclusion of the technical assessment on November 25, a final decision will be reached. Both parties have agreed to abide by the findings in full, whatever the outcome.

This is expected to definitively resolve the issue and effectively keep the matter out of the courts.

“There is no crisis looming. There's been some degree of trepidation [and] unease. Businesses have got some apprehension. Organised voices have raised the issue of what are the possible implications of this action by Eskom materialising, resulting in electricity interruption to Johannesburg. It's going to have dire consequences.

“But I'm confident that, once we get to conclude this technical assessment, we'll be able to provide a way forward in the most absolute fashion,” Ramakgopa said at a media briefing in Johannesburg on November 11.

The announcement, made alongside CoJ executive mayor Dada Morero and various executives from City Power, comes after Eskom threatened last week to implement power cuts across the city from December 14 if City Power does not pay its bills.

The disputed bills in question involve R3.4-billion in historic debt – which forms the primary focus of the dispute – along with an outstanding current account of R1.4-billion owed for October and an upcoming R1.3-billion for November, which is not yet payable, City Power CEO Tshifularo Mashava confirmed.

City Power began to default primarily because it disputed its monthly Eskom bill. Ramakgopa made it clear that this approach was problematic and that the user-pay principle must be upheld.

“If an individual customer has a query, that customer has an obligation to pay that current account as you set in motion the process of resolving the query. Once you are able to get to the bottom of the dispute, then you'll find remedies on how to then rectify the situation, historically, and also going forward, in the form of a credit note. But the customer still bears the obligation to pay until that dispute is resolved,” he said.

As such, City Power has now agreed to immediately pay up its current account in full and has committed to remaining up to date with this going forward.

Ramakgopa said the non-payment of the current account was what spurred Eskom to react and that the resolution of the current account default would effectively alleviate Eskom’s concerns and stave off the utility’s threats of city-wide power cuts.

“We have agreed [to the payment of the current account] because that is what had resulted in the triggering of that notice [by Eskom to implement power cuts]. It falls away because of a commitment to pay the current account, so the notice then gets to be withdrawn.

“Really what the notice was seeking to do was to ensure that we get to that point, that we pay the current account as we resolve the [historic] issues there that have been placed before Eskom by City Power,” Ramakgopa explained.

While the payment of the current account will stave off an immediate crisis, the technical assessment will seek to resolve the ongoing billing dispute regarding the R3.4-billion in outstanding historic debt, which dates back to 2019.

However, it will also seek to verify or correct the accuracy of Eskom’s billing to City Power so that billing disputes do not arise again in future.

Ramakgopa said the independent expertise required for the assessment will be sourced from within the State, albeit from bodies that have no relation to either City Power or Eskom. He said the parties would be approaching the South African National Energy Development Institute for assistance in recruiting the independent technical expertise needed for the assessment.

The independent energy expert will be flanked by an expert from City Power and Eskom respectively, to verify the findings and ensure objectivity.

Given that these matters are expected to be resolved before the end of November, Ramakgopa and Morero have both assured that there is no need for concern, expressing confidence that Eskom will not need to implement any power cuts.

“There's no crisis. There will be continuous supply of energy and electricity. We have also taken a view that, at a bigger scale into the future, we'll be collaborating quite closely between City Power and Eskom to look into projects that we can undertake to ensure that we keep Johannesburg as an investment destination by unlocking potential projects that require energy,” Morero said.