HomeIndustry SectorsFinance and PolicySA paper towel manufacturer tackles eThekwini Municipality over power dispute

SA paper towel manufacturer tackles eThekwini Municipality over power dispute

Following a four-year dispute over tariff structures, South African paper producer company, Tongaat Paper Company Pty Ltd, has filed an urgent application at the Durban High Court for the eThekwini municipality to restore its power.

eThekwini Municipality under the gavel

According to the eThekwini Municipality’s legal representation, the paper business has accumulated a ZAR3.4 million ($207,146) unpaid electrical bill, placing the city under financial pressure and leaving it no choice but to cut the power, The Mercury reported.

[quote]In response to the application, the city’s advocate Lisa Mills said the company had not shown urgency in the matter, as the disconnection took place in January.

In addition, Mills added that since that time, no attempts to pay back the money had been made.

Tariff structure being questioned

According to the company’s advocate, Jeremy Goldstone, the issue of tariffs charged by the municipality are being disputed by the firm, and have been in question since 2012 as it was on a business and general tariff but believed it should be charged a bulk tariff, The Mercury reported.

The paper towel manufacturer stressed that this issue was raised in 2012, explaining that due to the business and general tariff structure, it had been required to pay ZAR2.8 million ($207,245) more between July 2012 and November 2015.

According to the Daily News, the company’s manager, Vanasveri ­Naidoo, said in the court papers that 91 people could lose their jobs if the tissue, toilet rolls and paper towels manufacturer’s electricity was not restored.

“It is an industrial enterprise which operates 24 hours a day, seven days a week. (Its) operations are electricity intensive and require a constant supply of power,” Naidoo’s affidavit stated.

Tongaat Paper has filed a complaint with the city’s ombudsman, following the submission of an earlier notice of dispute had been ignored.

Request for bulk tariff

The company has asked to be put on a bulk tariff, however according to the city’s electrical department, this would only happen once the debt had been settled.

The Daily News reported that Naidoo argued that the company’s disconnection and continued disconnection was a violation of their right to fair treatment and the municipality’s policy and by-laws.

Naidoo added that if the power is not restored, the company will not be able to generate any income.

Ashley Theron
Ashley Theron-Ord is based in Cape Town, South Africa at Clarion Events-Africa. She is the Senior Content Producer across media brands including ESI Africa, Smart Energy International, Power Engineering International and Mining Review Africa.