City Power, the electricity utility owned by the City of Johannesburg, has gone to tender for outside experts to overhaul how it collects revenue, including AI-driven vending management. The aim is to cut losses that cost the city nearly R6 billion a year and to fix a billing system that residents have fought for years and that courts have criticised on several occasions.

The tender describes what the AI should do in broad terms. It should monitor customers and audit meters, analyse prepaid sales to flag unusual transactions, and compare what is sold through vending channels with the money that actually lands in City Power's bank account. The winning service provider must also find gaps in customer and meter data and flag consumption that is abnormal, missing or unaccounted for.

It has to connect to at least two major banks, two retail groups and cash vending machines, so customers without mobile data can still buy electricity.

The scale of the problem explains the move. The Auditor-General puts Johannesburg's electricity losses at about R5.7 billion a year, around 27% lost in distribution. Executive Mayor Dada Morero has said the city spends about R23 billion a year buying bulk power from Eskom and loses more than R5 billion of it to illegal connections, meter bypassing and theft.

City Power took over billing from the city last year and set up a dedicated unit for billing queries. It is also working against a R44-billion infrastructure backlog, with R2.354-billion set aside for infrastructure, metering and network upgrades in 2026/27.

Business Day's deputy editor Kabelo Khumalo reported the tender and City Power's reasoning for taking billing in-house, which it describes as a significant step toward accurate bills for all households and businesses. Business Day earlier reported Morero telling Parliament's public accounts committee that Joburg lost more than R10 billion to water leaks and stolen electricity.

The Centre for Development and Enterprise has separately urged a fast leadership overhaul at City Power in the new city administration's first 100 days.

Using AI to find where Joburg's electricity money goes missing makes sense, and catching a mismatch between sales and deposits is exactly the kind of work these systems do well. But so far the public knows almost nothing about how it will work.

Which company and which system will City Power use? Who inside the utility will oversee it? When the AI flags a customer or a meter as suspicious, does a person check it before anything happens, or can an account be blocked automatically? How can a resident dispute a flag, and how quickly? What customer data will the provider see, and how will it be protected? How will City Power measure whether the system is accurate, and what will it cost?

These are but a few questions. They matter because Joburg's billing problem is already about trust, and South African law expects a human in the loop when automated decisions substantially affect people under POPIA.

Rolling out AI on top of a system residents already distrust, without answers to these questions, risks repeating the old problem faster. It will be interesting to see how this develops, and whether City Power publishes the answers before the system goes live.

You might also like our piece on Johannesburg's R517.8m solar microgrids, Eskom selling less electricity than it did 20 years ago, and Standard Bank's responsible AI framework.

Get more SA tech and business news and subscribe to The Open Letter.