Sakeliga takes Eskom to court to keep lights on in towns countrywide

14 November 2018

The business organisation Sakeliga and Eskom will see each other in court on 20 November in connection with electricity interruptions in local communities.

With this legal action, Sakeliga intends laying down principles to prevent Eskom from interrupting the electricity supply of paying electricity users of municipalities simply because such municipalities’ accounts are in arrears with Eskom.

In the present action, the fourth this year, Sakeliga resumes its legal action against Eskom in Musina, after the Musina Local Municipality once again failed to make the necessary payments to Eskom. The action follows Eskom’s notice on 2 November in local media in Musina that Eskom intended interrupting electricity supply to Musina from 19 November.

Piet le Roux, chief executive, explains Sakeliga’s course of action: “Sakeliga cannot allow paying electricity users’ power supply to be cut simply because one arm of the state, a local municipality, does not pay what it owes another arm of the state, Eskom. An economic catastrophe is unfolding in local communities, and in addition, local business people are incurring huge costs to stop these power interruptions. By testing important legal principles in the case of Musina, Sakeliga is acting in the interest of local communities and local economies country-wide.”

Meanwhile, Sakeliga launched a support page on its website calling on community members living in towns who find themselves in similar situations to support the court case against Eskom about power cuts.

Le Roux highlights the extent of the problem: "More than 20 towns are currently on Eskom’s list of planned power supply interruptions. And this week, Zweli Mkhize, minister of cooperative government and traditional affairs, in parliament reported that municipal debt to Eskom had increased from R13,6 billion to R17 billion in six months this year. This is a national crisis, and interrupting the power supply to local economies is not going to solve the problem. This is why Sakeliga is intervening to establish the necessary principles to find a general, workable solution.”

In its latest court documents, Sakeliga requests the court to grant an urgent interdict –

1. Declaring that Eskom’s decision to interrupt electricity supply to Musina is unconstitutional, illegal and invalid;

2. Putting Eskom’s decision aside;

3. Declaring that Eskom and the Musina Local Municipality have not fulfilled their obligations to settle the dispute on debt in accordance with the Constitution, the Intergovernmental Relations Framework Act (2005), the Local Government: Municipal Financial Management Act (2003) and the Electricity Regulation Act (2006);

4. Ordering that the respondents work together to solve the problem in accordance with the Local Government: Municipal Financial Management Act, which respondents shall include not only Eskom and the Musina Local Municipality, but also NERSA, the Minister of Cooperative Government and Traditional Affairs, the Minister of Finance, the Member of the Executive Committee for Local Government in the Limpopo Province, and the Member of the Executive Committee for Finance in the Limpopo Province;

5. Prohibiting Eskom from using power interruptions to force the Musina Local Municipality to settle its outstanding debt to Eskom.

This is the fourth time this year that Sakeliga and Eskom are engaged in legal action against each other.

In May this year, Sakeliga assisted in preventing Eskom from interrupting electricity supply to the Kgetlengrivier Municipality.

In July this year, in the run-up to an urgent interdict application by Sakeliga, Eskom reached a payment agreement with the Musina Local Municipality.

In August, Sakeliga, as amicus curiae in the action between Resilient Properties and others versus Eskom and others, made unique legal contributions on the principles that should apply for Eskom in trying to collect debt from local municipalities.

Le Roux continues: “Eskom’s decision to interrupt electricity supply to Musina and other local municipalities is unacceptable. For Eskom it is a convenient illusion to pretend that municipalities simply are its customers and that it therefore is empowered to interrupt electricity supply to municipalities with outstanding debt. In reality, these entities all extensions of the state and subject to statutory provisions on dispute resolution, even if Eskom conveniently ignores these provisions. Of course municipalities should pay their accounts with Eskom, but we contend that paying end users should not be burdened with the internal coordination problems of what is essentially different arms of the state.”

Click here for Sakeliga’s court documents (heads of argument and affidavit).

Issued by Piet le Roux, CEO, Sakeliga, 14 November 2018