Johannesburg’s troubled electricity utility City Power’s infrastructure is deteriorating, its finances are precarious, much of the bulk electricity it buys never becomes revenue and it has been without permanent leadership for long periods.

To turn City Power around, a new city government will need to put capable people in charge, give the utility control over its own revenue, collect what it is owed and bring in the private sector, says policy research and advocacy organisation Centre for Development and Enterprise (CDE) executive director Ann Bernstein.

“Behind the failures experienced in the city are utilities that are under severe financial pressure, years of inadequate maintenance, weak management, enormous infrastructure backlogs and procurement failures.”

In the 'Powering Joburg’s Turnaround' report, CDE argues that a new city government should not dismantle key utilities and should fix them.

Some candidates for Johannesburg’s next mayor argue for the collapse of some or all the entities back into the city administration. Re-integration would not address the underlying problems; it could even make things worse, the report says.

“Collapsing utilities back into an already weak city administration will not fix them. It would change where the functions sit without addressing the problems that have left the utilities unable to deliver.

“This would also weigh on the city administration in a large restructuring process for years when what is required is the urgent restoration of reliable service delivery,” says Bernstein.

While loadshedding is no longer a national issue, Johannesburg has continued to struggle to keep the lights on. City Power reported 2.1-million forced interruptions between July 2025 and March this year.

It took 11 hours on average to restore each forced interruption. Customers experienced, on average, 20.6 hours without electricity during these periods.

Of the total power outages in Johannesburg, 60% were caused by deteriorating and outdated networks, the report shows.

City Power estimates that its infrastructure backlog stands at R44.25-billion, Bernstein points out.

Further, from 2019 onward, a persistent and widening gap has opened up between expenditure and revenue. By 2025, the deficit amounted to R4.3-billion, excluding capital grants and contributions.

City Power’s net internal overdraft with the City of Johannesburg had reached about R19.1-billion by March 31 this year.

Revenue from electricity sales is not ring-fenced for City Power. Instead of exercising control over the revenue it generates, these funds are regularly sent into the City’s consolidated revenue pool, with funds then transferred back to City Power to meet its financial requirements and operations.

“In November 2025, the City of Johannesburg committed to ring-fence a portion of the revenue for City Power and Joburg Water, with 70% to be retained by the utilities and 30% transferred to the city.

“However, on what basis was this ratio determined, or is it arbitrary, and is it enough? City Power is already struggling to cover its operating costs, before considering its infrastructure backlog,” the report states.

Electricity and Energy Minister Kgosientsho Ramokgopa described the problem starkly, stating that, for every R100 of bulk purchases, City Power can only reticulate about R70.

“City Power has already lost R30 even before it can collect. That’s a race to the bottom,” he said.

City Power’s third-quarter report for the 2025/26 financial year shows that overall meter-reading performance was at about 72% against a target of 98%, and more than 36 000 customer registers having generated no bills during a billing cycle.

At the end of June 2026, City Power was owed around R13.3-billion by its customers, the CDE report shows.

Additionally, City Power has serious capacity issues, from its senior leadership to the technical staff needed to run the electricity network, and operates with an acting CEO.

In 2024/25, of City Power’s 278 professionally qualified posts, 122, or 44%, were vacant.

Among senior technicians, 36, or 72%, of 50 posts were vacant. Critical posts have remained vacant for hundreds of days, with some unfilled for over two and a half years, the report says.

The scale of the infrastructure backlogs and the loss of technical and management capacity mean that Johannesburg will need private capital, specialist skills and probably outside management capacity.

Bringing in the private sector should therefore form a cornerstone of the utility’s recovery.

“This does not mean that private participation should substitute for functioning public institutions,” Bernstein says.

“Johannesburg needs organisations capable of ensuring universal service and equity obligations, specifying what must be done, managing contracts, protecting public assets and holding private providers accountable for results.”

The report offers a strategy for the first 100 days, based on electricity utility turnaround and management experience.

“It is imperative to do a few decisive things in the right order: stabilise leadership, secure the cash, stop the bleeding, keep the lights on.

“Sequence ruthlessly and, crucially, say where the people and money will come from,” says Bernstein.

In the first month, the mayor must stabilise the leadership by appointing an empowered, time-bound crisis executive with a small war room, while the city recruits a permanent CEO.

During the second month, it is about stopping the bleeding, including holding town-hall meetings in the three most-affected service delivery centres to present a clear plan, give tough messages, and make an offer for arrears normalisation.

The final stretch is about locking it in and showing progress, including appointing a permanent CEO and CFO, and must return to report back publicly in subsequent town-hall meetings.

“Ultimately, there are no easy or quick fixes. The strategy will need to be decisive, realistic and carefully planned,” Bernstein says.

“Johannesburg’s voters have an important opportunity on November 4. The state of the City’s utilities, and what should be done to fix them, should be part of the debate about Johannesburg’s future.

“Parties and candidates seeking to govern the City should be pressed to explain how they will restore reliable electricity, water and refuse collection, and how they will rebuild the institutions responsible for delivering them,” she says.

FIXING CITY POWER
The report provides four key areas of advice on what the incoming city administration should do to address the challenges facing its electricity utility.

Johannesburg's next administration must fix the leadership of City Power by starting with the board and the CEO, and then getting the right people into mission-critical positions, with the focus on areas such as managing finances, technical expertise and fixing procurement processes.

If appointments to senior positions are done without being based on merit, City Power will not be fixed, the report states.

Additionally, ring-fencing revenue must be implemented clearly and consistently, which will give City Power more control and certainty over the revenue generated.

This process must also permit a non-arbitrary process through which some of that revenue can be allocated to urgent, budgeted needs that the city needs to fund, such as repairing roads and water infrastructure.

The incoming administration must also radically improve revenue collection by giving City Power the mandate to sort out customer and property records, improve meter reading, and resolve billing disputes.

The utility should also have a mandate to implement strategies to rebuild trust with customers while also implementing a firm but fair strategy to cut off customers who fail to pay their bills.

The fourth recommendation is for the City of Johannesburg to bring in the private sector.

The emphasis must be on practical, accountable and transparent service and performance-based contracts. This will bring in private sector technical and managerial expertise quickly and effectively, while ensuring that they contribute quickly and positively to turning around City Power.