The South African state-owned corporation, Eskom and Merafong City Local Municipality officially signed a Distribution Agency Agreement (DAA) at the Merafong Council Chambers, and categorised it as a historic milestone that signals a new era of cooperation, improved operational efficiency, and enhanced electricity service delivery for communities across Merafong.
Electricity distribution and certain retail functions are expected to be jointly managed in a structured framework.
This comes after the struggling Maluti-a-Phofung in the Free State and Emfuleni in Gauteng agreed to sign a DAA with Eskom for similar reasons.
The agreement is seen as a strategic and transitional intervention designed to stabilise electricity distribution, strengthen governance, and improve revenue collection while ensuring consistent and reliable power supply for residents and businesses in the city.
Amongst other agreements is billing and revenue collection will be ring-fenced and administered through Eskom systems, Merafong will remain the electricity licence holder, with Eskom providing technical expertise, operational support, and skills transfer, Free Basic Electricity will be disbursed directly by Eskom to qualifying indigent households, and long-term structural reforms will continue through National Treasury to support municipal fiscal sustainability.
The DAA introduces key improvements to strengthen the resilience and accountability of Merafong’s electricity distribution system:
- Strengthened operational coordination between Eskom and the Municipality.
- Improved maintenance processes and fault-response times.
- Enhanced infrastructure planning and investment readiness.
- Clearer responsibilities, reporting lines, and accountability mechanisms.
- Greater reliability and predictability of electricity supply.
- Protection of existing jobs and structured training for municipal employees.
- Capacity-building and skills transfer to support long-term municipal sustainability.
The municipality has a growing national municipal debt owed to Eskom, which exceeded R105 billion as at September 2025.
While owing Rand Water R1.4 billion, the municipality has been struggling with shortages of water supply and lack of service delivery. This has led to significant and frustrating water supply cuts and reliance on tankers, raising concerns about water quality and service delivery disruptions like school closures.
Speaking at the signing ceremony, the Municipal Manager, Dumisani Mabuza emphasised Merafong’s commitment to stabilising infrastructure and restoring public confidence.
“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. This agreement reinforces our vision of building a sustainable, responsive city centred on accountability and progress.”
Representing Eskom, the Gauteng Cluster General Manager, Bandile Jack thanked both Eskom and the municipality for their collaboration and emphasised that Eskom looks forward to the positive results this partnership will yield for both organisations and the communities they serve.
“The signing of this DAA with Merafong is a critical step towards it stabilising electricity distribution and improving revenue collection to enable the municipality to provide electricity for its citizens. This partnership demonstrates Eskom’s commitment to work collaboratively and proactively with municipalities to restore operational efficiency and ensure sustainable service delivery for communities with the focus on capacitation and skills transfer,” said Eskom acting Group Executive for Distribution, Agnes Mlambo.
