Salga calls for Eskom and Nersa reforms to address municipal debt

THE South African Local Government Association (Salga) has said the Distribution Agency Agreement (DAA) aimed at addressing the ballooning R105 billion debt to Eskom is not sufficient in itself, pointing to inefficiencies with Eskom's systems and lack of capacity of the National Energy Regulator of South Africa (Nersa) to efficiently regulate 167 municipalities with only a 400 staff complement.

- BANELE GININDZA

Salga told Parliament on Friday that it was seeing a surge in the repeated deterioration and aging of infrastructure, the decline in financial sustainability in municipal distribution businesses, the poor asset management and outdated technologies, the rising operational costs and severe revenue losses, escalating vandalism theft and illegal connections at the municipal level. Salga said there was inherent danger of fragmentation on distribution with Eskom, along with 167 municipalities licenced to provide independent electricity distribution.

"We are saying it is not only municipalities that don't have capacity. Eskom equally has its own challenges in terms of capacity. In terms of free basic electricity, Eskom has the sole responsibility in the small towns.

Communities come back to the municipality after we have registered them to say that they are not able to access. And when you go to Eskom, it's a mix-up in their system.

Municipalities are unable to actually implement their own credit control because Eskom does not award them that particular thing," Salga Councillor Kenalemang Phukuntsi said.