Cities like Joburg in debt to Eskom won't be able to benefit from electricity 'wheeling'
Minister Kgosientsho Ramokgopa has announced amended rules that will open up South Africa's electricity network, but municipalities indebted to Eskom will be excluded from wheeling.
Powerlines, Electricity, Pylons, Pixabay
702's John Perlman is joined by energy expert Professor Vally Padayachee.
The Electricity Minister's announcement of reforms to open up South Africa's electricity network has been widely welcomed.
The formalisation of electricity 'wheeling' through third party power providers helps break the monopoly Eskom maintained for years over power generation and distribution.
RELATED: Electricity 'democratisation': Ramokgopa announces reforms to ease third-party energy provision
However, those municipalities owing substantial amounts in unpaid debt to Eskom, will not be able to benefit from wheeling.
John Perlman talks to energy expert Professor Vally Padayachee, former executive manager at Eskom and former senior executive at City Power Johannesburg.
Prof. Padayachee, who was also involved in formulating the regulatory changes, says the decision around indebted municipalities was a business decision.
"In any business, if you owe me money then i need to get paid. It's no use giving you services incurring more debt and still you're owing me money."
Prof. Vally Padayachee, Energy Expert
At the same time, this is a catch-22 situation, he acknowledges
"You cannot really compromise the innocent independent power producer and the innocent customer whether he or she sits on the Eskom or municipal becauae there's a discrepancy between Eskom and the municipality."
"The bigger discussion is around the root causes, and these go beyond just municipalities not wanting to pay."
Prof. Vally Padayachee, Energy Expert
Listen to Prof. Padayachee's explanation of the wheeling system in the interview audio at the top of the article