(Bloomberg) --

South Africa’s electricity distribution system is “an albatross” beset by fighting between the national power utility and municipalities as the government takes steps to stabilize the grid, according to the electricity minister.

State-owned Eskom Holdings SOC Ltd. has focused on improving the performance of the mainly coal-fired power stations that have become unreliable due to neglected maintenance, resulting in record electricity outages that curb economic growth.

But the networks that connect to customers have become a growing challenge, electricity minister Kgosientsho Ramokgopa said Sunday in an online briefing.

“The one area that remains an albatross is the distribution side,” he said. That includes disputes between Eskom and municipalities that owe the utility about 62 billion rand ($3.3 billion) in arrears for electricity they sold on to customers.

South Africa has taken measures to add generation from independent producers through government auctions, though the process has been delayed and some projects held up due to grid constraints. Some businesses that can afford it are building their own generation.

Financially distressed municipalities are unable to maintain local distribution assets, which makes the equipment more prone to breakdowns, Ramokgopa said. Illegal connections also add strain to the system.

China Agreements

South Africa signed an agreement with China’s largest grid operator during the BRICS summit in Johannesburg last week on cooperation in clean energy investments.

“They’ve worked out the kind of transmission modernization that’s required to be able to accommodate the intermittency of renewable energy sources,” Ramokgopa said.

Another pact involved the donation, currently en route to South Africa, of about 450 mostly gasoline and diesel generators, along with some solar and battery units, for use in public facilities.