Eskom is taking South Africa’s largest city to court over the alleged failure by City Power to pay debts totalling nearly R1.1-billion.

The utility said it has been “left with no choice” but to apply to the high court for a declaratory order to force City Power to pay up.

The metro’s electricity utility is struggling to keep the city’s ageing power infrastructure functioning amid a skills deficit, rampant vandalism and theft of its infrastructure, and an insufficient budget for maintenance and capital programmes.

The case against City Power has been enrolled for 4 June, Eskom said in a statement on Monday. It said City Power started defaulting on its payments in October 2023, and no payment was received for the March 2024 invoice.

“The debt owed by City Power has reached unprecedented levels, exacerbating Eskom’s already-strained financial situation,” Eskom said.

“This dire situation not only undermines Eskom’s financial sustainability but also threatens its ability to maintain essential infrastructure, invest in new technologies and meet the growing energy demands of the province (Gauteng),” it added.

It said City Power had declared a dispute with it recently over “potential overbilling on bulk purchase invoices dating back to 2021”.

Arbitration

“Eskom denies the claims made by City Power and will prove its position through the arbitration process,” it said, adding that even though there is a dispute, City Power is obliged to pay its dues. “The dispute does not absolve it of its legal obligations to pay Eskom for the bulk electricity it has received.”

But the City of Johannesburg clapped back at Eskom, arguing that the power utility was “rushing to the courts” over a R1.1-billion debt while ignoring Eskom’s R3.4-billion debt to the city for “overcharges” over a number of years.

“The city is of the strong view that the financial obligations of City Power to Eskom vs the financial obligations of Eskom to the city should be treated in the same manner and symmetrically,” it said in a statement on Tuesday.

“Following multiple discussions regarding queries that have been lodged in connection with gross inaccurate billing on bulk purchase invoices, Eskom has opted to ignore those issues, and rushed to the courts,” it said.

According to the statement, the city pays Eskom about R1-billion for electricity every month, and its concerns about it being overbilled for electricity have been raised since 2021.

“More often than not, the national utility chooses to ignore these discrepancies that are brought to their attention. Eskom has admitted in some cases that there have been potential billing inaccuracies and has so far refunded City Power at least R483-million over the recent years.