eThekwini Municipality has denied awarding seven companies to supply electricity smart meters.

In a written response to the story that the Independent Media published last week, the city’s spokesperson, Gugu Sisilana, said the municipality was not aware of differing quantities being placed across suppliers; therefore, dismissing the assertion of wasteful expenditure.

Sisilana said the procurement process is still ongoing.

“The allegations of wasteful expenditure, which are not corroborated by any evidence, are not true. This is due to the fact that the procurement process for electricity meters is still ongoing through the Supply Chain Management process. We are not aware of differing quantities being placed across suppliers,” she said.

Despite the city’s denial about the awards, information obtained from the city’s website revealed that indeed the companies were awarded accordingly.

Independent Media also saw purchase orders matching the companies’ awards on the city’s website.

Sources within the municipality have described the decision to award all the companies as an attempt to avoid awarding the tender to a qualified supplier with the lowest quote.

The source said the only possible reason for this was that the officials wanted kickbacks from the highest bidders. 

In May 2024, the National Treasury approved the RT29 national transversal for smart metering. The Treasury approved seven companies for the city to choose from when buying these smart meters.

In the purchase orders, the city ordered 2,000 smart meters from a particular supplier, which cost R2,591 per unit, whereas the other supplier’s unit price was R1,645.

One provider charged R2,218 per item, while the other charged R1,811. The city had to pay R5.9 million for 2,000 smart meters from the highest-priced supplier, which likewise had a unit price of R2,600.

The source said the city also ordered non-smart meters for R1,996 per unit, which totalled R4.5 million for 2,000 units. It is not clear why the city needed non-smart meters and which customers will be supplied with them, whereas others use smart meters.

Among the companies are two giant cellular network companies.

In contrast to non-smart meters, which require personnel to physically visit the site and disconnect when consumers have circumvented them or established unauthorised connections, smart meters may be switched off by city officials from the office, the source claimed.

“This is another wasteful expenditure the city has incurred, and there is no valid reason why the officials chose to purchase the same product with the same quality from different suppliers with varying prices. Surely, there is something fishy,” said the source.

The municipality has been in the headlines for incurring costs that many view as wasteful, stemming from court cases it has lost.

It was recently forced to pay a supplier more than R20 million, which was an interest that had accumulated from the court appeals it had finally lost. The supplier had initially demanded R30 million, which the city disputed but lost the appeal.

willem.phungula@inl.co.za

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