By Chantelle Benjamin and Khulu Phasiwe

Premier Mbhazima Shilowa has criticised government’s decision to create regional electricity distributors (Reds), saying they will undermine Gauteng’s economic development.

Gauteng, the economic powerhouse that accounts for 33% of SA’s gross domestic product, is aiming for growth of 8% by 2014 in a bid to reduce unemployment and poverty.

According to a report in Business Day, Shilowa says the key to this growth is the creation of a city region similar to that of London’s and Tokyo’s.

“(With) Reds... The idea is that the metros Tshwane, Ekurhuleni and Johannesburg will all work for themselves, while we in Gauteng want all municipalities to work together as a city region. And government tells us that we will get money from somewhere else, but it won’t be as much as we are receiving from a utility that is already resourced,” Shilowa is reported as saying.

Shilowa wants Gauteng’s 14 municipalities to function as a city region, co-operating on issues of common interest and preventing the duplication of functions.

The Reds are Cape Town, Port Elizabeth, Durban, Tshwane, Johannesburg and Ekurhuleni. A national distributor will absorb the functions of the other 180 local councils.

The restructuring of the electricity industry is aimed at making electricity distribution more efficient and prices fairer. The present system, which allows municipalities to set their own prices, has resulted in 2000 sets of tariffs.

Read the full story, posted on businessday.co.za.

Source: Business Day