HomeIndustry SectorsFinance and PolicyRefuted: Green light for Western Cape to source energy direct from IPPs

Refuted: Green light for Western Cape to source energy direct from IPPs

The Ministry of Mineral Resources and Energy refutes as misleading and premature the statement issued by the Democratic Alliance (DA) regarding the procurement of electricity through Independent Power Producers (IPPs).

Earlier today (19 November) the DA announced that South Africa’s Minister of Energy and Mineral Resources, Gwede Mantashe, had approved the Western Cape government’s request to procure power directly from independent power producers (IPPs).

This ‘victory’ dates back to 2017 when the City of Cape Town took legal action against the former energy minister, Mmamoloko Kubayi, to secure its rights to purchase power directly from renewable IPPs.

Response from the Ministry

The promulgated IRP provides for – among other things – any individual or group to undertake embedded generation projects up to a maximum of 500MW per annum. This is part of South Africa’s long-term plan to pursue a diversified energy mix, which covers all possible generation options.

It remains the Minister’s prerogative, as provided for in Section 34 of the Electricity Regulation Act, to ensure security of electricity supply through determining – among other things- the size, technology type, which entity produces the electricity, and by when it should be connected to the grid.

The Ministry has engaged with the National Council of Provinces (NCOP) to provide an opportunity for the Minister to make a presentation on the IRP.

This is done to enable provinces to engage with the Minister and highlight issues that pertain to their individual situation. The Ministry is pleased that the NCOP has swiftly indicated its willingness to enable this engagement before the end of November 2019. The NCOP has further assured the Ministry of the participation of all provinces.

To this end, all provinces – including the Western Cape Legislature – are encouraged to participate in the process and raise issues for the Minister to consider in line with the Ministerial Determinations under section 34 of the Electricity Regulation Act.

Continuing to lobby government

In light of the recent nationwide loadshedding, the DA-led local government persisted with their quest that the province is permitted to seek energy from elsewhere and not only rely on Eskom.

Commenting on the development on Twitter, DA spokesperson on finance and economic development, Deirdre Baartman, said: “We need to reduce our reliance on coal as our primary source of power and improve our carbon emissions control. It is for this reason that we need to urgently to engage a new bid window for IPPs in order to ensure a more diverse, clean, competitive and efficient energy sector.”

“We will continue to lobby national government to green light the processes in order to make this process possible for our residents, and protect our province economy from the scourge of load shedding.”

Alternative energy to boost energy supply

Speaking at 2019 AMEU Convention in October, the City of Cape Town’s Councillor Phindile Maxiti noted that “South Africa is currently grappling with energy shortages and this poses a threat to its own economy if not dealt with urgently.”

Maxiti said the City is looking into innovative smart technologies including Small Scale Embedded Generation to boost energy supply.

“With the pool of IPPs, the City believes this is way another to solve the country’s energy crisis,” he said.

Although the city might have missed its plans of generating 20% of its electricity from renewable resources by 2020, the updated Integrated Resource Plan (IRP) presents new targets for this city and others keen on pursuing the IPP route.

“The plan [IRP] remains within the policy framework of pursuing a diversified energy mix that reduces reliance on a single or few primary energy sources. It will be revised in line with the changing energy sector environment,” said Mantashe.

Babalwa Bungane
Babalwa Bungane is the content producer for ESI Africa - Clarion Events Africa. Babalwa has been writing for the publication for over five years. She also contributes to sister publications; Smart Energy International and Power Engineering International. Babalwa is a social media enthusiast.