Eskom's revenue soars as non-payers step forward

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Eskom is set to receive a major financial boost. Approximately 400,000 customers, previously avoiding electricity payments, have come forward to update their meters. This move is expected to generate an extra R440 million per month, according to Cape {town} Etc.

Addressing Illegal Electricity Connections

Many of these customers had bypassed legal channels. They accessed power through illegal methods, such as meter tampering or fraudulent prepaid vouchers. The Minister of Electricity and Energy, Kgosientsho Ramokgopa, shared this news during a recent media briefing.

Technical Issues Revealed Non-Payers

The issue came to light due to a technical update in Eskom’s prepaid token system. This process revealed a large number of non-paying users.

Ramokgopa previously estimated that around 2.1 million customers obtained electricity illegally. Now, that number has dropped to 1.7 million. This improvement is largely due to customers voluntarily coming forward to regularise their accounts.

Positive Financial Impact For Eskom

The 400,000 new legal customers will contribute significantly to Eskom’s revenue. With an average monthly consumption of R1,200 per low-income household, Eskom expects a substantial financial uplift.

The additional R440 million per month will reduce Eskom’s revenue shortfall. Previously, non-paying customers cost Eskom around R2.5 billion each month. With these changes, losses could drop to R2 billion monthly, saving R24 billion annually.

Reducing Pressure on Law-Abiding Customers

Non-paying customers had been accessing power directly from Eskom, bypassing municipalities. Ramokgopa stressed that illegal practices strain Eskom’s finances.

They also increase the burden on honest, paying customers. As a result, law-abiding citizens face higher tariffs to compensate for lost revenue.

Municipalities Face Similar Challenges

The South African Local Government Association (Salga) estimated that municipalities lose about R8.6 billion annually due to similar issues. To combat this, Eskom is enhancing its revenue protection measures.

However, challenges remain. Some staff face threats of violence, especially in high-risk areas. Monde Bala, Eskom’s distribution chief, acknowledged these difficulties but assured the public that efforts to address them will intensify.

TID Rollover Progress

Ramokgopa confirmed that 99% of Eskom’s paying customers have already completed the Token Identifier (TID) update. Some technical issues persist, but Eskom is addressing them through its offices. Municipalities are also updating their systems.

Compliance Deadline Approaching

Eskom set a deadline of 13 December 2024, for customers to update their meter numbers. After this date, non-compliant users will face penalties.

Although the technical deadline is May 2025, Eskom aims to enforce compliance sooner. This proactive approach ensures that customers meet requirements before the final cut-off.

A Step Towards Stability For Eskom?

This initiative marks a significant step in improving Eskom’s financial health. With continued efforts, the utility can reduce losses, stabilise operations, and ease the burden on honest consumers.