South Africa's municipal electricity debt crisis is often reduced to a familiar story: failing councils, weak billing systems, political interference and a culture of non-payment. There is truth in that, but it is incomplete.

Municipal electricity debt has become a macroeconomic and industrial issue because electricity distribution is not a niche municipal service - it is a central artery of the economy. Municipal distributors supply households, malls, office parks, factories, hospitals and public infrastructure. When municipal electricity trading accounts collapse, the effects ripple outward: maintenance is deferred, outages multiply, network losses rise and investment decisions tilt away from municipal supply areas. The result is a slow degradation of reliability, affordability and competitiveness.

The uncomfortable implication is that municipal arrears are not simply a symptom of poor local governance. They are also the predictable outcome of an electricity distribution industry (EDI) structure that has, over time, placed municipal distributors in an increasingly untenable position - financially, operationally and politically. The crisis should properly be framed as a structural misalignment at the centre of South Africa's EDI, with Eskom in the thick of it.

Structural lock-in: how municipalities became dependent on Eskom

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Historically, many municipalities generated, transmitted and distributed their own power largely to "white" residents, businesses and services, with revenues aligned to local networks and local responsibilities. Over time, that model was dismantled. Eskom's centralised generation expanded, while the municipal customer base grew and municipalities...