Joburg executive mayor Dada Morero has opted to avoid a potentially bruising confrontation with Eskom over the more than R5bn electricity bill the city owes the utility, which might plunge the country’s economic hub in darkness.Morero in his state of the city address on Wednesday signalled his administration’s willingness to find an amicable solution with Eskom after the utility a day earlier threatened to disconnect the city.“We will not fight Eskom. We will work with the minister of electricity & energy [Kgosientsho Ramokgopa], and Salga [South African Local Government Association] to resolve this challenge,” Morero said.The city is home to the country’s largest banks and Africa’s largest stock exchange, the JSE.Eskom issued a notice on Tuesday to the metro and its entity City Power of its intention to reduce, interrupt or terminate the supply of electricity to certain bulk supply points due to the outstanding debt of R5.3bn.Eskom said the drastic decision followed the city’s failure to honour a debt repayment agreement. The debt is part of more than R111bn owed by municipalities to Eskom, which has launched several initiatives to assist them with repayment. Morero called on the National Treasury, the public protector, and the Special Investigating Unit to investigate the city’s finances, without providing specifics.He said City Power has a turnaround plan addressing the challenge. “Part of the solution is to implement National Treasury and department of co-operative governance & traditional affairs guidance to reform and strengthen municipal trading entities,” the mayor said. “This reform agenda will assist the city to improve governance, financial sustainability, operational efficiency and accountability within entities that have historically operated under significant fiscal and infrastructure pressure.” He said requests for proposals were issued to approved development finance institutions. “This resulted in an agreement in principle with KFW, a German bank, to provide a loan of €200m to fund energy-related projects, which aligned with City Power’s project pipeline and infrastructure funding requirements,” Morero said. “The city, as the borrower, and City Power, as an execution agent, are currently finalising a contract with KFW with the expectation that KFW will be disbursing the agreed loan amount before the end of June 2026.” Eskom, the state-owned power utility, has given the Joburg metro until July 8 to clear its arrears and debt or face disconnections. If Eskom follows up on its threat, Joburg residents could be in for a harsh winter, when demand generally spikes. Eskom’s notice comes after finance minister Enoch Godongwana wrote a stinging letter to Morero slamming his agreeing to a wage agreement of R10.3bn when the city lacked the funds and threatened to withhold the metro’s R8bn equitable share instalment for July if Morero does not scrap the deal. The city is technically insolvent, having incurred overexpenditure of about R3.9bn on employee-related costs, bulk electricity purchases, inventory consumed and operational costs. The council’s finances are further severely constricted due to poor revenue collection and the resultant failure to meet service delivery targets. In April, GCR Ratings revised the city’s ratings outlook from stable to “rating watch negative” because of the metro’s delays in finalising its annual financial statements. The city also has to contend with an infrastructure backlog of more than R200bn, adding to the water challenges facing the city.“Combined infrastructure backlog is estimated at more than R220bn. Water main failure is at 1,552/100km … the highest in all metros. Nonrevenue water losses is at 44.7%. Electricity losses are at 27.1%,” Morero said, adding turnaround plans are in place aimed at ensuring water security and predicting asset management, energy security and the just transition, road infrastructure rehabilitation and waste management.“The budget speech will allocate resources. Alone, we will not win this battle of backlogs. It is important that we continue to partner and leverage resources from like-minded people and institutions who are interested in the growth of Johannesburg,” said Morero. Morero said the city is executing on R73bn worth of infrastructure and development projects. Key investments include the following:R27bn in foreign direct investment; Microsoft’s R5.4bn data centre driving the Smart City Programme; A R7bn waste-to-energy partnership with the National Infrastructure Fund and the Netherlands government; and A R760m Midrand Bulk Water Storage Facility to ensure regional drought resilience. Morero said productivity is crucial and must underpin service delivery. “Corruption must not be tolerated. Where corruption takes place, arrests must be made.”