Eskom, Merafong sign electricity distribution agreement

Merafong becomes the third municipality to sign a distribution agency agreement with the power utility, after Maluti-a-Phofung in the Free State and Emfuleni in Gauteng. 

The agreement forms part of Merafong City’s broader turnaround strategy, which focuses on stabilising electricity infrastructure, addressing financial challenges, and improving service delivery. 

During a council meeting in November, it was revealed that the municipality owed Eskom R1.6 billion, as well as R1.4 billion to Rand Water. 

National municipal debt owed to Eskom exceeded R105 billion as of September 2025.

Under the agreement, electricity distribution and certain retail functions will be jointly managed within a structured framework. Billing and revenue collection will be ring-fenced and administered through Eskom’s systems, while Merafong City will remain the licensed electricity distributor. 

Eskom will provide technical expertise, operational support, and skills transfer. Free Basic Electricity will be disbursed directly by Eskom to qualifying indigent households. Long-term fiscal reforms will continue to be handled through the National Treasury.

Eskom’s Gauteng Cluster General Manager Bandile Jack said the agreement is part of Eskom’s broader approach to supporting struggling municipalities.

“Today represents more than the signing of a document. It represents a shared commitment to strengthening our electricity network, enhancing technical support, and ensuring that our residents receive the stable and reliable services they deserve.”

The agreement includes provisions for improved maintenance processes, fault response times, infrastructure planning, clearer accountability mechanisms, and protection of existing municipal jobs, alongside structured training.

Eskom's Acting Group Executive for Distribution, Agnes Mlambo, said the agreement would assist the municipality in stabilising electricity distribution and improving revenue collection. 

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