Eskom spokespersons, Sikonathi Mantshantsha and Stefanie Jansen van Rensburg, tell OFM News respectively that their legal teams have not received any official documentation pertaining to Matjhabeng’s counterclaim. The Free State municipality claims Eskom unlawfully and unconstitutionally hijacked the municipality’s powers since its establishment in 2000, by directly supplying electricity to consumers, which include “Thabong, farms, and mines in its area”.

Matjhabeng spokesperson, Kgojane Matutle, says this happened despite the municipality, being able to on its own, supply electricity within its municipal boundaries. 

The tug of war between the two parties came under the spotlight in early September, when the power utility successfully managed to attach the municipality’s bank account, in an effort to recoup its mounting debt, which at present stands at R3,4 billion. In reaction, Matjhabeng, being desperate and unable to access the account, put up 139 of its farms as security, so that they would be able to pay employees and render services.

This move by the municipality was heavily criticised by opposition party members in the province, specifically the EFF.

Mantshantsha further says “all of Eskom’s operations are licenced and regulated by the Electricity Regulation Act of 2006 through the National Energy Regulator of South Africa (NERSA)”.

Three days after Eskom publicised that Matjhabeng had put up 139 of its farms as security for its debt, the municipality vehemently defended the agreement. The municipality outlined the terms of said agreement with the nation’s power utility, deeming it the only way to ensure that essential services continue to be delivered to Welkom, Virgina, Odendaalsrus, Hennenman, Allanridge, and Ventersburg residents.

The ongoing battle between the parties dates back to 2019, when Eskom approached the Bloemfontein High Court in an effort to recoup its money from the municipality - deemed to be one of its ten worst offending municipal clients. The Free State on the other end of this court action has launched a counterclaim, disputing Eskom’s claims that they were owed money for services rendered. However, Eskom approached the inter-governmental dispute resolution forum in order to attach the municipality’s bank account. At the beginning of September 2020, Eskom emerged successfully.

Matutle stresses “by putting up the farms as security, the farms have not been transferred to Eskom and Matjhabeng has not lost control or ownership thereof. They may still be used for their intended purpose. Eskom still has to prove its claim, which the Municipality obviously disputes,” says the spokesperson.

However, should the Bloemfontein High Court side with Eskom on the R3,4 million debt, the municipality has a contingency plan in place. 

The municipality tells media they will still be “entitled to negotiate a repayment plan if the parties cannot come to an agreement, the issue will be determined” coincidentally by the same inter-governmental dispute resolution forum that gave Eskom the green light to attach Matjhabeng’s bank account in the first place.

OFM News