Rabia Mayet | rabiamayet@radioislam.co.za

28 April 2026

3-minute read

Fuel supplier African Rhino Fuels has launched legal action against City Power, a Johannesburg power utility, alleging its non-payment for 250 000 litres of diesel in July 2025.

Struggling to keep up with its Eskom payment and bills from various suppliers, City Power, owing a combined figure of R1.3billion, has given no indication of when it intends to pay back the debts.

Professor Vally Padayachee, power and energy expert, former executive manager of Eskom and former senior executive of City Power, stated that the diesel was most likely used to fuel the diesel-fired gas turbine infrastructure used in emergency situations. The 4 gas turbines located around the city require an exorbitant quantum of diesel, alongside the current “global geo-political conditions,” with war in the Middle East causing diesel prices to skyrocket.

Quoting figures from the media where prices from Eskom have gone up 1500% over a 6-year period, the professor says that a significant amount of City Power’s operating budget goes towards cost of sales and bulk purchases from Eskom. In the same period, inflation has only gone up by 285% and added to this is a customer base that seemingly does not pay. With revenue decreasing and debt increasing, these challenges are bound to occur. The Chairman of the City Power board has also asked for a bigger budget to make purchases from Eskom despite the backlog on payments.

“What’s happening in City Power is symptomatic of what’s happening in other metros and munics (municipalities),” says Prof Padayachee, although at a different level. So, while City Power appears to be highlighted, being the largest metro in the country with the biggest economy, it is also the biggest collective consumer of power and electricity. Thus, as the largest load centre, its bill is also the highest. The huge influx of people into the city resorting to unpaid illegal connections on the grid adds to the utility’s challenges.

Prof Padayachee stated that this is not the first time that City Power is experiencing this type of problem. Not negating the inefficiencies of the power utility, it may be that City Power needs a different type of leadership to deal with the crisis and make itself profitable once again. He is hopeful that the challenges are short-term but reiterated that it also needs the help of government, shareholders and the regulator to get back on track.

While capacity a concern, another core challenge is that if the utility does not have sufficient money in its budget, it will not be able to to procure power from Eskom, and continuously maintain, refurbish and strengthen the grid. There is a potential that there will be a disruption to power supply of all customers which the stakeholders need to address this collectively.

Professor Padayachee concluded that the Department of Minerals and Energy is in the process of revising the energy pricing policy, and this will most likely reduce the price of electricity.

Listen to the full interview with Ml Junaid Kharsany and Professor Vally Padayachee here.