Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News
      Dell guns for MacBook Neo with low-cost laptop

      Dell guns for MacBook Neo with low-cost laptop

      1 June 2026
      Telkom reports this Tuesday: the real story will be in the detail - Serame Taukobong

      Telkom reports this Tuesday: the real story will be in the detail

      31 May 2026
      Nvidia's first CPUs to debut in Windows laptops this week

      Nvidia CPUs to debut in Windows laptops this week

      31 May 2026
      SA telecoms industry veteran appointed to top Eskom job - Junaid Munshi

      SA telecoms industry veteran appointed to top Eskom job

      29 May 2026
      The hidden cost of social media age bans is everyone's privacy

      The hidden cost of social media age bans is everyone’s privacy

      29 May 2026
    • World
      Watch: Bezos rocket erupts in fireball during ground test

      Watch: Bezos rocket erupts in fireball during ground test

      29 May 2026
      AI boom hands Samsung chip workers life-changing bonuses

      AI boom hands Samsung chip workers life-changing bonuses

      27 May 2026
      Luce lit: Ferrari unveils its first electric car

      Luce lit: Ferrari unveils its first electric car

      26 May 2026
      Huawei claims chip design breakthrough

      Huawei claims chip design breakthrough

      25 May 2026
      Pope urges world to hit brakes on AI - Pope Leo

      Pope urges world to hit brakes on AI

      25 May 2026
    • In-depth
      Alfa's electric rebel - Alfa Romeo Junior Elettrica Veloce

      Alfa’s electric rebel

      29 April 2026
      Africa switches on as Europe dims the lights

      Africa switches on as Europe dims the lights

      9 April 2026
      The biggest untapped EV market on Earth is hiding in plain sight

      The biggest untapped EV market on Earth is hiding in plain sight

      1 April 2026
      AI, cybersecurity power standout year for Datatec - Jens Montanana

      The R16-billion tech giant hiding in plain sight

      26 March 2026
      The last generation of coders

      The last generation of coders

      18 February 2026
    • TCS
      TCS+ | The Up&Up Group on the hidden cost of AI - Jason Harrison

      TCS+ | The Up&Up Group on the hidden cost of AI

      13 May 2026
      Michael Rossouw

      TCS+ | The retirement decision most South Africans get wrong

      6 May 2026
      TCS | The Cape Town start-up listening for TB with AI - Braden van Breda

      TCS | The Cape Town start-up listening for TB with AI

      4 May 2026

      TCS+ | ‘The ISP for ISPs’: Vox’s shift to wholesale aggregator

      20 April 2026
      TCS | Werner Lindemann on how AI is rewriting the infosec rulebook

      TCS | Werner Lindemann on how AI is rewriting the infosec rulebook

      15 April 2026
    • Opinion
      Treasury's crypto crackdown is a betrayal of Mandela's promise - Duncan McLeod

      Treasury’s crypto crackdown is a betrayal of Mandela’s promise

      22 May 2026
      South Africa is sleepwalking into another AI policy failure - Celeste Labuschagne

      South Africa is sleepwalking into another AI policy failure

      20 May 2026
      AI won't fix your culture - it will expose it - Jackie Kennedy

      AI won’t fix your culture – it will expose it

      19 May 2026
      Treasury's crypto crackdown is a betrayal of Mandela's promise - Duncan McLeod

      Free calls, dead voice and Shameel Joosub’s Spanish ghost

      22 April 2026
      The conflict of interest at the heart of PayShap's slow adoption - Cheslyn Jacobs

      The conflict of interest at the heart of PayShap’s slow adoption

      26 March 2026
    • Company Hubs
      • 1Stream
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • Ascent Technology
      • AvertITD
      • BBD
      • Braintree
      • CallMiner
      • CambriLearn
      • CM Telecom
      • Contactable
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • HOSTAFRICA
      • Incredible Business
      • iONLINE
      • IQbusiness
      • Iris Network Systems
      • Kaspersky
      • LSD Open
      • Mitel
      • NEC XON
      • Netstar
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Telviva
      • Tenable
      • Vertiv
      • Videri Digital
      • Vodacom Business
      • Wipro
      • Workday
      • XLink
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Financial services
      • HealthTech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Motoring
      • Policy and regulation
      • Public sector
      • Retail and e-commerce
      • Satellite communications
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
    • Events
    • Advertise
    TechCentralTechCentral
    Home » In-depth » To prepay or not to prepay Eskom

    To prepay or not to prepay Eskom

    By Chris Yelland7 May 2015
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp
    Brian Molefe
    Brian Molefe

    In the first two weeks of his appointment, some questionable public statements made by Eskom’s new acting CEO Brian Molefe makes one wonder whether he is receiving sound information from his executive team. Public enterprises Lynne Brown seems to have had similar problems.

    After a presentation to the public enterprises parliamentary portfolio committee, and a media briefing thereafter that reeked of unfounded confidence and hubris, Molefe suggested that the solution to Eskom’s financial woes would be to bypass municipal electricity distributors and supply all customers with electricity in South Africa — domestic, commercial, agricultural and industrial — directly, thus extending its monopoly.

    Local government, in the form of municipalities, have the constitutional right to distribute electricity. Like Eskom distribution, they purchase electricity in bulk from Eskom, operate a distribution network, and deliver electricity to residents and businesses embedded in their geographic service areas. Municipalities use surpluses from this activity to cross-subsidise and fund their other municipal service delivery obligations.

    While the problems of some 20 defaulting municipalities out of a total of some 180 has been well publicised, it must certainly be galling to the significant majority of municipal electricity distributors to hear that the failing Eskom wants to bypass them all in order to use their surpluses to sort out its own financial problems.

    This especially as Eskom’s own performance in distributing electricity direct to domestic and commercial businesses in areas such as Soweto is among the very worst of them all, with theft and non-payment amounting to some 83% of electricity supplied direct to the residents and commercial businesses in Soweto by Eskom. Indeed, with no end in sight, Eskom’s own theft and non-payment financial problem in Soweto alone is bigger than its non-payment problem with all 20 defaulting municipalities combined.

    Molefe went on further to suggest that all Eskom customers, large and small, that currently have credit meters, and pay for electricity monthly on a 30-day credit account, should be required to change to prepayment meters. His rationale was that this would quickly resolve Eskom’s cash-flow crisis by bringing forward some two months’ revenue, amounting to about R20bn, into Eskom’s depleted coffers.

    Is it conceivable that Molefe and his executives are unaware that Eskom’s existing domestic, commercial, agricultural and industrial customers have to make a prepaid deposit amounting to three months’ electricity usage before opening a 30-day credit account? As such, electricity customers on credit meters effectively prepay even more than customers on prepayment meters, who do not pay this three-month deposit.

    This means that if all credit customers were to change to prepayment meters as suggested by Molefe, the three-month prepaid deposits for credit customers would presumably have to be refunded, which would mean that Eskom’s cash flow crisis may in fact worsen rather than improve.

    eskom-640

    Finally, Molefe appears to have been led to believe that prepayment meters are somehow a panacea for all the revenue protection and collection problems experienced by Eskom Distribution and municipal electricity distributors.

    This is strange, because prepayment meters were pioneered by Eskom itself in the early 1990s, and have been around for decades, alongside credit meters. Strange, too, because Eskom’s long experience with both prepayment and credit meters shows that there are areas with prepayment meters having good levels of non-technical losses, and other with poor levels. The same applies to areas with credit meters.

    Thus it is clear that successful revenue protection and collection are not simply a choice of meter technology, but a holistic approach where both prepayment and credit meters, and a whole range of good management, performance monitoring, credit control and enforcement practices form part of the solution.

    A number of regulated tariff options, including those involving both prepayment and credit meters, are currently available and approved by energy regulator Nersa, and it would certainly not be left to Eskom’s whim or discretion to force a credit customer onto a prepayment tariff without good reason, simply to suit Eskom’s financial needs.

    After neglecting the theft and non-payment of electricity in Soweto and other problematic areas for decades, there is simply no quick fix as Molefe seems to believe. The solutions will require a long haul, with commitment and support from national and local government politicians, the cabinet, relevant government departments, Nersa, Eskom, municipalities, the police, courts and correctional services.

    • Chris Yelland is the investigative editor of EE Publishers
    • This piece was first published on Moneyweb and is republished here with permission
    Follow TechCentral on Google News Add TechCentral as your preferred source on Google


    Brian Molefe Chris Yelland Eskom Lynne Brown
    WhatsApp YouTube
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleSA science making its mark, bit by bit
    Next Article Microsoft Surface 3 review: laptop killer?

    Related Posts

    SA telecoms industry veteran appointed to top Eskom job - Junaid Munshi

    SA telecoms industry veteran appointed to top Eskom job

    29 May 2026
    Eskom breaks ground on R1.2-billion Lethabo solar plant

    Eskom breaks ground on R1.2-billion Lethabo solar plant

    27 May 2026
    Cape Town pioneers pooled wheeling of renewable electricity

    Cape Town pioneers pooled wheeling of renewable electricity

    25 May 2026
    Company News
    The remarkable story of Lesaka's Lincoln Mali

    The remarkable story of Lesaka’s Lincoln Mali

    1 June 2026
    Why most workforce engagement changes nothing - Change Logic

    Why most workforce engagement changes nothing

    29 May 2026
    Arctic Wolf takes aim at South Africa's security blind spots - Jason Oehley

    Arctic Wolf takes aim at South Africa’s security blind spots

    29 May 2026
    Opinion
    Treasury's crypto crackdown is a betrayal of Mandela's promise - Duncan McLeod

    Treasury’s crypto crackdown is a betrayal of Mandela’s promise

    22 May 2026
    South Africa is sleepwalking into another AI policy failure - Celeste Labuschagne

    South Africa is sleepwalking into another AI policy failure

    20 May 2026
    AI won't fix your culture - it will expose it - Jackie Kennedy

    AI won’t fix your culture – it will expose it

    19 May 2026

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Latest Posts
    Dell guns for MacBook Neo with low-cost laptop

    Dell guns for MacBook Neo with low-cost laptop

    1 June 2026
    The remarkable story of Lesaka's Lincoln Mali

    The remarkable story of Lesaka’s Lincoln Mali

    1 June 2026
    Telkom reports this Tuesday: the real story will be in the detail - Serame Taukobong

    Telkom reports this Tuesday: the real story will be in the detail

    31 May 2026
    Nvidia's first CPUs to debut in Windows laptops this week

    Nvidia CPUs to debut in Windows laptops this week

    31 May 2026
    © 2009 - 2026 NewsCentral Media
    • Cookie policy (ZA)
    • TechCentral – privacy and Popia

    Type above and press Enter to search. Press Esc to cancel.

    Manage consent

    TechCentral uses cookies to enhance its offerings. Consenting to these technologies allows us to serve you better. Not consenting or withdrawing consent may adversely affect certain features and functions of the website.

    Functional Always active
    The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
    Preferences
    The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
    Statistics
    The technical storage or access that is used exclusively for statistical purposes. The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
    Marketing
    The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
    • Manage options
    • Manage services
    • Manage {vendor_count} vendors
    • Read more about these purposes
    View preferences
    • {title}
    • {title}
    • {title}