R35 billion Electricity Infrastructure Backlog

“The maintenance backlog of municipal electricity infrastructure is at about R35bn and rising by R2,5bn a year, Parliament heard yesterday.¬†Municipalities are failing to invest in infrastructure because they need funds for operational expenses and because of uncertainty over the future ownership of the assets,” reports Business Day.

Back of the napkin calculation based on the above figures shows that maintenance of municipal electricity infrastructure has been neglected for about 14 years.

This is a problem underlying each and every service provided by government, including water utilities. Taxation, whether direct or indirect, is going to climb dramatically to pay for crisis management, ala Eskom tariff hikes.

A major reallocation of capital into these areas will be required that will be a huge drain on the private sector and the economy.