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City of Tshwane cancels R27 billion smart meter system

In 2013 the City of Tshwane entered into a 10-year contract worth R27 billion with PEU Capital to outfit the nation’s capital with 800 000 smart electricity meters. But it has come to light that the City has now decided to terminate the contract with PEU Capital – effectively wasting R830 million it has already provided.

The company was contracted to install almost a million smart meters across the city, but the City has revealed that only 12 930 meters have been installed so far.

The reason why the City cancelled the project is a little bit murky, but it stems from a court battle launched by Solidarity-subsidiary AfriSake about the awarding of the contract to PEU Capital. The organisation claims that proper procedure was not followed when the tender was awarded.

“PEU has no experience in the installation or management of electricity infrastructure in towns or cities“, and “is probably an example of one of the most blatantly corrupt municipal transactions to date,” AfriSake claims in court papers.

The City wasn’t funding the smart meters themselves and only paying PEU for meters already installed, as raising funds for the actual installation was up to PEU.

And with the pending court case, Tshwane’s executive director of strategic communication, Selby Bokaba explained to 702 Talk Radio that no institution or company was willing to further fund PEU.

With no funding on the cards, PEU couldn’t complete the contract, which left the capital “with little choice but to issue a formal notice to terminate.”

The City said that even though the current contract has been terminated, it “will endeavour to ensure that there is no interruption to the service as a result of the termination of the smart prepaid metering contract.”

Bokaba explained to 702 that a new tender will be opened in due time to finish the installation of the remaining meters.

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