Eleventh hour court action by the Grahamstown Business Forum (GBF) and Grahamstown Residents Association (GRA) has staved off punitive power cuts in Makhanda until the case is heard later this year.
The two organisations together with two companies in the city launched the action in the high court after Eskom placed a notice in regional newspapers advising of its intention to introduce power cuts for up to 14 hours a day because of Makana Municipality’s debt of more than R85-million and its failure to abide by an earlier payment agreement.
It emerged that the municipality, in contravention of its own council resolution, had been using money received from residents for electricity to pay staff salaries instead of paying Eskom.
The GBF and GRA said the planned power cuts would be catastrophic for business, detrimentally affect hospitals and schools and further impact on Makana’s already shambolic service delivery – particularly the provision of water and disposal of sewage.
They sought an interdict against Eskom, with the National Energy Regulator (Nersa), Makana Municipality and the Makana mayor and municipal manager named as co-respondents.
With the proposed power cuts set to start on April 2, the applicants asked for an urgent court hearing last Thursday (March 28).
In their papers they asked the court to order the municipality to pay Eskom what it is owed, or alternatively, come up with a payment plan and be compelled to report monthly on compliance.
Judge Nhlangulela heard the arguments of counsel for the applicants and counsel for Eskom, and they came to an agreement that the case be postponed to June 6 and that Eskom agreed, pending that hearing, not to implement the provisions of its suspension notice of March 14.
This does not include load shedding which may be scheduled from time to time.
The agreement was made an order of court.
Also, by virtue of their interest in the matter and their capacity to assist in the resolution of the dispute, National Treasury, the minister for cooperative governance and traditional affairs (Cogta) and the Eastern Cape MEC for Cogta have been joined as respondents.
All respondents were ordered to file papers notifying the applicants of their intention to oppose, or otherwise.
The applicants and Eskom are authorised to engage with the municipality and the other respondents in the matter with a view to agreeing upon a mechanism for the settlement of the municipality’s debt and the determination of a payment mechanism for future electricity supplies to Makana.
Makana Municipality was also ordered to pay a portion of its equitable share from central government, as it relates to electricity, directly to Eskom within 24 hours of receiving such share, and to give written notice to the applicants and Eskom that it has done this.
The municipality was further ordered to pay over to Eskom by the seventh of each month, from the funds paid by consumers in respect of electricity, the amount due to Eskom, again with written notice.
The municipality also has to pay the costs of the applicants and Eskom.