Municipal revenue and service delivery

[00:00:00] Hello, my name is Pagazile Matebula and I am a senior manager in the Project Management Office known as PMO at City Power Johannesburg. I am a panelist at Enlit Africa 2025 where I will be discussing and crafting a way forward on what municipalities can do to increase financial sustainability, resilience and revenue generation. [00:00:28] The most important conversation we should be having is how to shift from the current revenue model that municipalities are currently relying on. We need to shift from that and reflect the energy realities of today. If you look at the current model, it's mainly based on electricity sales, which is unfortunately no longer viable in the face of load shedding, load reduction, load rotation, not forgetting illegal connections that cause a lot of unplanned power out. And generally customers moving away from grid to adopting solar PV and gas. They use gas for cooking, space heating and water heating. The third reality here is that the customers that have migrated away from the grid are affluent customers that were able to pay their municipal debt. If you look at what worked 40 years ago doesn't work anymore in today's environment. The energy landscape has evolved a lot in the past and it continues to evolve at a faster pace. So it's very important for municipalities to evolve to be agile enough and move with the times. If not, they will be taken out of business. [00:01:37] Number two, municipalities need to shift away from just being electricity distributors. They need to be energy enablers. So we need to rethink the whole value chain. Start by investing in smart and automated infrastructure. Partner with independent power producers that are certainly not going away and leverage on renewable projects like your wheeling micro grids and your small scale embedded generators. [00:02:05] At this time, many South African municipalities are in financial distress. They are struggling with rising debt. They are struggling with poor revenue collection and declining service delivery. Believe me, service delivery has declined. If you look at the debt of municipalities to Escom and to the various water ports in South Africa, it's shocking. It's actually threatening energy security. [00:02:30] So my presentation will be giving an opportunity of highlighting innovative ways of implementing new financial models that may turn the tide around and also strategies that would enhance revenue collection within the municipalities. [00:02:46] What excites me the most about municipal financing is the potential that it has, the transformative potential that it has. If structured correctly and implemented correctly, it can turn struggling municipalities into economic powerhouses that can drive local economic development, promote energy security and support infrastructure resilience within their areas of supply. So I believe municipal financing, if done correctly, can turn this tide around. [00:03:18] So come and join me at ended Africa 2025 at the Cape Town International Convention center from the 20th till the 22nd of May. See you there.