NATIONAL NEWS - A small Centurion business that buys on average R17 000 of electricity every month got a nasty shock when notified last week it had five days to pay R1.2 million to the City of Tshwane for under-recovery of electricity cost since 2015.

The city’s service provider, Total Utilities Management Services (Tums), said in its e-mail to Productive Systems that this was due to a technical fault detected during a “field site investigation”.

It informed the company that it would do a “debit adjustment” to its prepaid electricity meter and gave the company five days to pay the R1.2 million.

The fault that caused the alleged under-recovery was outside of the company’s control and there is no suggestion that it tampered with the metering system.

According to Productive Systems MD Albert Birmingham, the company has a annual turnover of about R20 million. It designs and builds machinery for local and international clients in the packaging industry.

He says to expect a small company to cough up about 6% of annual turnover at the drop of a hat is unrealistic and could kill the company that employs about 50 people.

“We have been paying an average of R17 000 per month for electricity over the past few months. We did the costing and billed our clients on the basis of that. The city now claims an additional R42 000 per month for the past 30 months. I cannot go back to my clients in Panama, China and Australia and tell them I have undercharged them”, Birmingham says.

The problem on the company’s account seems to be the same as the one the city of Tshwane identified on that of the Agricultural Research Council (ARC), which was notified of underbilling of R30 million at the Onderstepoort Veterinary Institute in the north of Tshwane.

Moneyweb in November last year reported that Tums, which is the implementation vehicle for the city’s smart metering contract with Peu Capital Partners, admitted to over and underbilling some of the 13 000 Tshwane customers it supplied with electricity since October 2013.

Read more on the Caxton publication, The Citizen.