New 70/30 Prepaid Electricity recovery model approved
Thursday, 17 September 2026
At the Special Council Meeting held on 15 September 2026, Overstrand Council approved an amendment to the Customer Care, Credit Control and Debt Collection Policy to formalise the 70/30 auxiliary split for indigent customers.
The amendment was necessary because the previous policy provided for a 90% auxiliary debt recovery deduction for indigent customers whose municipal accounts are in arrears. The amended policy comes into effect on 16 September 2026.
What it means:
The approved amendment reduces the prepaid electricity debt recovery percentage for indigent customers whose municipal accounts are in arrears from 90% to 70%, while the general debt recovery percentage for customers in arrears remains at 60%.
This approach supports indigent households by allowing a larger portion of prepaid electricity purchases to be used for electricity consumption while maintaining a sustainable debt recovery process.
Simple explanation of the 70% / 30% auxiliary split:
For indigent customers with arrear debt:
* 70% of a prepaid electricity purchase is allocated towards outstanding municipal debt
* 30% remains available for electricity consumption
This is a significant improvement from the previous 90% debt recovery rate, allowing indigent customers greater access to electricity while still contributing towards the repayment of arrear debt.
Issued by:
Edward Jantjies, Overstrand Acting Municipal Manager