NERSA CEO says unconventional gas, smart grid and the internet, off-grid technology and the impact of solar panels on municipal revenues are potential game changers for the energy industry

Phindile BaleniExclusive interview with Phindile Baleni, CEO, NERSA.  She is a pane4llist in the opening session of the upcoming African Utility Week and Clean Power Africa from 13-14 May at the CTICC in Cape Town.

What is NERSA’s mandate and tell us one interesting fact that isn’t generally known about the regulator.
NERSA’s mandate is to regulate the electricity, piped-gas and petroleum industries in accordance with applicable legislation. We do not only set prices for Eskom, customers that have complaints about their electricity suppliers can approach the Energy Regulator for assistance.

African Utility Week’s opening session addresses the vision for a sustainable African utility sector, what role can regulators play in achieving this?
Regulation for the public good aims at striking a balance between the interests of society by treating the utility’s customers fairly, while also treating the regulated entities’ investors fairly. The role of regulators is to ensure a reliable and sustainable industry, while promoting affordability and accessibility of services.

What are the global changes and circumstances that will influence the energy industry in the next decade?
There are four potential game changers:

  • Unconventional Gas has the potential to change many things. It offers higher conversion efficiency and quicker build times of “off the shelf” combined cycle units. It also offers greater energy independence.
  • Smart Grid and the internet, offer greater operational efficiencies and many other things.
  • Off Grid technology applied to rural areas which are not easily reachable by the grid.
  • Impact of solar panels on municipal revenues.

How do the latest tariff determinations impact on key stakeholders?
We have confidence that the MYPD3 tariff determination has managed to strike the delicate balance between the interests of the utility on the one hand and the consumers on the other hand. We believe the price increase of February 2013 was affordable by electricity customers.

What is your view on global tariffs (does any country stand out for you and why)?
The main driving force for tariffs is the energy mix and technology choices available to each country. In this regard it seems that the USA is getting it right at the moment as they take advantage of their unconventional gas resources.

What can we expect in the future in terms of feed-in tariffs?
Government opted for an international competitive bidding process than the feed-in tariff approach. The Energy Regulator will not be determining feed-in tariffs.

Are there any past dispute cases that highlight progress?
One dispute that was successfully resolved is the Chiawelo Community dispute. The community had a problem with the split meters installed in the area, there was a perception that the split meters were running fast resulting in high electricity charges. The National Energy Regulator intervened and the dispute was successfully resolved.

What are the opportunities that Africa can take into consideration when planning generation capacity?
The abundance of the renewable energy resources, natural and unconventional gas are opportunities that the continent can exploit maximally.

What surprises you about this sector?
The way it transforms lives. For example, women gaining extra quality time because they do not have to collect firewood from far away forests. How it eliminates the risk of personal losses resulting from paraffin fires. How it improves the quality of learning outcomes and reduction of the burden of disease caused by fossil fuel fires.

What are you most looking forward to at African Utility Week this year?
The sharing of experiences and expertise that positively contributes in the effective execution of our mandate at this historical inflection point at which we are exploring for shale gas as South Africa.

Anything you would like to add?
Unity of purpose, unity in action and working together is the only way to lift the development
trajectory of South Africa. The luxury of finger pointing is past.