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Court grants Eskom power to cut electricity to defaulting municipalities

Business Report
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Johannesburg - The Gauteng North High Court in Pretoria has dismissed applications by AfriForum and other businesses which sought to prevent Eskom from effecting scheduled electricity interruptions to defaulting municipalities. 

Earlier this year, AfriForum led a group of businesses who applied for an urgent interdict against Eskom to stop the utility cutting electricity to eight municipalities that had not settled their bills.

Esjom's head of legal, Suzanne Daniels, said Astral, Bridgestone, AfriForum and Mediclinic had sought to prevent Eskom from implementing scheduled interruptions in Madibeng, Lekwa and Kamiesberg in order to recover overdue debt. 

According to a statement from Eskom, the applicants' contention, heard earlier this month, was that Eskom's conduct, in all the cases, was unconstitutional, unlawful and unreasonable and should accordingly be reviewed and set aside. 


The applicants sought different relief against Eskom, including declaratory orders to the effect that Eskom was not permitted to interrupt the supply of electricity to any local authority as a means to collect acknowledged debts owed to it. 

On the second day of the hearing, Eskom and Astral reached a settlement agreement in respect of the direct payment relief and the hearing proceeded with the matters of the three remaining applicants. 

Eskom opposed all the relief sought on the other issues raised by the remaining applicants, arguing the mootness of all the cases and the legislative rights of Eskom to interrupt or terminate the electricity in terms of the Electricity Regulation Act (ERA). 

Eskom said the court agreed with all the arguments presented by Eskom to the effect that section 21(5) of the ERA is constitutional and Eskom is empowered by statute to disconnect defaulting customers, which includes municipalities. 

"In granting the judgement in favour of Eskom, the court confirmed that any exercise by Eskom of the power in section 21(5) of ERA will be administrative action reviewable by the court on the ground of legality, reasonableness and procedural fairness under section 33 of the Constitution and the Promotion of Administrative Justice Act (PAJA)," Daniels said. 

"This victory is a critical step in the sustainability of Eskom given the levels of indebtedness within the municipal sphere. As a key enabler of the economy, Eskom's sustainability is vital for the development of our nation."

AFRICAN NEWS AGENCY
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