Eskom CEO Brian Molefe says municipalities that have electricity arrears, should enter into an agreement to allow Eskom to install prepaid meters for customers. He also anticipates a complete move to prepaid meters in the long term.

“[In the] long-term, South Africa should move to prepaid electricity. This will eliminate debt from rising. People will be able to buy prepaid vouchers and use the electricity they have paid for. The system works very well in the communications industry with cellular phones,” he said during a briefing to the Portfolio Committee on Public Enterprises, at Parliament, on Wednesday.

He said indigent people would be given vouchers to access free electricity.

A pilot project is about to start in the Eastern Cape, with some municipalities and provinces showing their approval for a prepaid system, said Molefe.

The Eskom CEO, who presented the utility’s integrated results to the committee said Eskom had been able to improve its energy efficiency and avoid load-shedding for several months.

“It is our contention that, with the commercial operation of the Ingula units and coming on stream of Medupi Unit 5, we will be out of danger of any load-shedding.”

Generation plant performance improved in the second half of the financial year. Molefe said improved performance was the result of swifter operations, extracting efficiencies, keeping up with maintenance and catching up with maintenance backlogs.

Molefe told the committee that all Ingula units were able to support the grid with generating power during the winter months. Three of Ingula’s units were in commercial operation, while Unit 3, which was damaged during testing, is currently being fixed.

He said the utility had phased out using diesel as a back-up for power, as it was extremely expensive.

“Diesel was used as a last resort to avoid load-shedding until recently. None of our diesel costs were recoverable, so we used the Eskom balance sheet. It is expensive and if we continue to use diesel, we will simply erode our balance sheet.

Molefe said the utility had been spending R1-billion rand a month on diesel. Eskom has been phasing out the use of diesel, using only R6-million worth of diesel between April 1 and now, he said.

On electrification, Molefe said 90% of the country’s people now had electricity, with provinces such as the Free State, Gauteng, the Northern Cape and the Western Cape achieving 100%. The Eastern Cape, KwaZulu-Natal and Limpopo were lagging behind.

Meanwhile, Democratic Alliance MP Natasha Mazzone raised the now perennial criticism of Eskom for giving bonuses to its executives at a time when there was an economic slump, saying it was a “cold slap in the face” for many South Africans who had lost jobs, partly because of Eskom’s contribution to the downturn.

But Eskom chairperson Ben Ngubane said executives had been set stiff performance contract targets, and they had achieved these.