Appeals court ends Eskom’s ‘coercion’ on municipalities with liquidity problems



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In June 2017, the energy company threatened to cut the supply to the two municipalities to induce them to pay. At the time, Emalahleni owed Eskom about 1.2 billion rand, while Thaba Chweu owed him about 407 million rand.

Both signed debt acknowledgments in favor of Eskom, committing to cancel the accumulated debt in agreed monthly installments. But these commitments were not kept, leading Eskom to cut off its power supply.

The decision of the electric company was contested by several parties.

In Emalahleni’s case, Resilient Properties, which owns the Highveld Mall there, filed the application. The 68,200m2 The mall has 185 commercial tenants. Resilient had fulfilled its payment obligations to the municipality for the supply of electricity, despite the latter’s failure to comply with Eskom.

In the second application, three chambers of commerce in the area challenged the decision to cut off the electricity supply in Thaba Chweu. They said the disruptions had a devastating effect as they threatened the fabric of society, with hospitals, schools, homes and businesses severely affected.

Gwilym Rees, who filed an affidavit on behalf of the chambers, explained the effects of the cuts.

“First of all, when the power supply is cut off, all sewerage works stop immediately. This means that the wastewater is not pumped to the wastewater processing plants, but will simply stay (and eventually spill onto the streets) for the duration of the outage, with associated serious risks to the health of the community. “



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