Eskom Holdings SOC Limited v Lekwa Ratepayers Association NPC and Others; Eskom Holdings SOC Limited v Vaal River Development Association (Pty) Ltd and Others

Eskom, a state-owned enterprise and the sole licensed bulk electricity supplier to municipalities, reduced bulk electricity supply to the Lekwa and Ngwathe Local Municipalities to their historically agreed Notified Maximum Demand (NMD) levels because of the municipalities’ long-standing failure to pay substantial arrears owed to Eskom. These NMD levels were outdated and insufficient to meet current demand. As a result, residents—who were paying consumers using prepaid electricity—experienced extensive municipal load shedding, leading to severe socio-economic, humanitarian, and environmental consequences, including disruption of hospitals, water and sewage systems, businesses, and pollution of the Vaal River. Resident associations brought urgent applications for interim interdicts to compel Eskom to restore electricity supply pending review proceedings to set aside Eskom’s decisions under PAJA or the principle of legality.

Both appeals were dismissed with costs, including the costs of two counsel. The interim interdicts restoring electricity supply pending finalisation of review proceedings remained in force.

The case affirms that Eskom, as an organ of state, is bound by constitutional principles, including cooperative governance, reasonableness, and legality, when exercising contractual powers that affect basic municipal services. It reinforces judicial protection of residents against severe humanitarian consequences arising from intergovernmental failures and clarifies when interim interdicts may be appealable in the interests of justice.