The twin crises of surging municipal arrear debt owing to Eskom and rising electricity theft have been lurking for years, and with all efforts to combat the problems having failed.

In fact, Eskom’s outgoing CFO, Calib Cassim, warned last week that municipal debt owing to Eskom could reach an eye-watering R300-billion by 2030.

By the end of March, debt owing to the utility by municipalities had increased by 27% to R94.6-billion and Cassim confirmed that it had since climbed to above R103-billion. Worryingly, Eskom also indicated that the figure could reach R135-billion by the end of the current financial year.

The scale of the problem has been further underlined by an Energy Intensive Users Group calculation showing that in the ten-year period from 2015 to 2025 arrear debt increased by over 1 800%, from R5-billion to R94.6-billion.

This surge has come despite a National Treasury initiative that created an incentive for municipalities, which represent 42% of Eskom’s total sales of some 189 TWh, to improve their payments to Eskom.

Under the scheme launched in 2023 alongside the R230-billion debt relief extended to sustain Eskom’s position as a going concern, municipalities were offered an opportunity to write off their legacy debt in phases. To do so, they needed to meet 14 conditions, including one stipulating that they kept their current accounts with the utility up to date.

At the time, the municipalities collectively owed less than R60-billion.

While the National Treasury has bravely defended the programme and there have been pockets of success, Eskom has never been a fan. Last week, it reiterated its concerns, stating bluntly that the National Treasury’s municipal debt relief programme had not been successful in stemming the escalating levels of arrear debt.

Describing the problem as a systemic challenge, Eskom called for an inter-governmental approach. And despite posting a R16-billion profit and a positive outlook, it warned that the problem posed a serious threat to its sustainability.

For its part, Eskom is punting distribution agency agreements and prepaid supply models. However, it’s unclear whether such solutions will find widespread favour across local government.

Sadly, that’s not all!

Eskom also reported that 14.9 TWh of electricity was lost to theft in its 2025 financial year, which in monetary terms represents R28-billion in foregone revenue.

The utility did not provide a breakdown of the nature of the theft, but at least part of it relates to large-scale fraud arising from the fact that its online vending system for the generation of prepaid tokens has been breached.

Eskom’s remedies include the roll-out of 7.2-million smart meters and a plan to accelerate the implementation of an entirely new online vending system.

As with the municipal debt problem, however, it’s unlikely that technocratic and technology interventions alone will be sufficient to arrest what is now a serious culture of nonpayment.

It also does not help that these efforts will have to take place at a time when tariffs have breached affordability levels for many.