Joburg settles R5.25bn Eskom debt

The City of Johannesburg has settled its outstanding R5.25 billion electricity debt to Eskom.

The Department of Electricity and Energy and the City of Johannesburg confirmed on Friday that Eskom had received the final payment, clearing overdue debt of R5.255 billion owed by the city and City Power.

The settlement follows an intervention and mediation process led by Electricity and Energy Minister Kgosientsho Ramokgopa, bringing together the City of Johannesburg, City Power and Eskom to resolve long-running billing disputes.

The dispute had raised concerns about the potential impact on Johannesburg's electricity supply. Following confirmation of the final payment, Eskom withdrew the Promotion of Administrative Justice Act (PAJA) process it initiated on 17 May 2026 to address the outstanding arrears.

Ramokgopa welcomed the resolution, saying the inter-governmental process had helped bring the matter to a definitive conclusion while ensuring an uninterrupted electricity supply and protecting Eskom's financial sustainability.

Johannesburg Executive Mayor Dada Morero described the settlement as a significant step towards improving the city's financial sustainability and responsible governance.

The city has committed to keeping future electricity accounts up to date, reducing losses caused by theft and vandalism, and investing in critical infrastructure.

Eskom and City Power will also continue working together on infrastructure maintenance, reducing electricity losses and improving data-sharing to support long-term electricity security in Johannesburg.

Government outlines plan to lower electricity costs

The South African government has outlined measures aimed at reducing electricity costs while keeping tariffs cost-reflective and protecting vulnerable households and key economic sectors.

The proposals are contained in the Revised Electricity Pricing Policy, which updates the 2008 policy and was approved by Cabinet for public comment last month.

Electricity and Energy Minister Kgosientsho Ramokgopa said tariffs have increased by about 977% since 2007, highlighting the need for a new pricing framework.

10-year electricity price forecast

The policy will require the National Energy Regulator of South Africa (NERSA) to publish a 10-year electricity price forecast, giving businesses and investors greater certainty when planning long-term investments.

It will also establish a framework for transparent, efficient and cost-reflective tariffs while preventing hidden costs from being passed on to consumers.

More competition in electricity market

Government is also opening the electricity market to greater competition as part of reforms aimed at reducing Eskom's dominance.
The new framework will allow generators and electricity users to enter into bilateral supply agreements outside of Eskom, supporting the transition towards a wholesale electricity market.

Stronger protection for vulnerable households

The policy will strengthen support for poor and vulnerable households while tackling the impact of unpaid municipal electricity debt.

Ramokgopa said consumers who pay their electricity bills should not be forced to carry the cost of those who do not.

Government also plans to modernise the administration of free basic electricity by creating a central database linked to Home Affairs and social grant records. This is intended to make it easier to identify households that qualify for assistance.

Support for energy-intensive industries

Government will also introduce a Negotiated Pricing Agreement mechanism to support electricity-intensive industries, including businesses that are not currently in financial distress but could contribute to economic growth and job creation if given more competitive electricity prices.

Ramokgopa said the overall objective is to improve efficiency in the electricity sector and create conditions that could ultimately result in lower electricity costs.
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