Plans to restructure the distribution of electricity would drain the Ethekwini unicity's coffers, a large portion of whose income is generated through electricity tariffs and bills.
It has emerged in the Durban unicity's budget for the current 2002/2003 financial year that the national government is planning to form six cross-province electricity distribution centres to be responsible for distributing electricity to communities.
Local government authorities, who presently buy bulk electricity from Eskom and then supply it to consumers, would be stripped of the supply duty.
A need to address "substantial fragmentation of the industry" compelled the national government to start drafting the proposal from the early 1990s.
And last year, the ministry of minerals and energy recommended that six regional electricity distributors - formulated by the cabinet in 1998 in an attempt to consolidate multiple distributors - be established.
It has been estimated that if such restructuring does not take place soon, electricity tariffs would rise by 40 percent in real terms in the next 10 years.
However, city treasurer Krish Kumar believes the idea would be a setback for municipalities, and particularly Durban, whose income is drawn from tariffs and billing.
"The consolidation of water, electricity and rates accounts offers considerable advantages to municipalities and customers alike. The removal of the electricity account would mean loss of economies of scale in billing procedures."
Should the restructuring go ahead, municipalities would expect compensation for envisaged losses.