Sarec in show­down with the coal lobby

Le­gal ad­vice sought over IPPs

The Star Early Edition - - NEWS - Di­neo Faku

THE SA RE­NEW­ABLE En­ergy Coun­cil (Sarec) said it was tak­ing le­gal ad­vice on be­half of its mem­bers af­ter the SA Coal Trans­porters Fo­rum (CTF) filed court pa­pers in the High Court to stop the gov­ern­ment from sign­ing in­de­pen­dent power pro­duc­ers (IPP) pro­grammes yes­ter­day.

“Sarec is cur­rently tak­ing le­gal ad­vice on be­half of its as­so­ciate mem­bers and con­sid­er­ing the op­tions avail­able to them. We hope to have clar­ity by Mon­day,” a spokesper­son said.

Sarec is an an um­brella body to the in­dus­try as­so­ci­a­tions rep­re­sent­ing spe­cific re­new­able en­ergy tech­nolo­gies and has ac­cused Eskom of drag­ging its feet on the con­clu­sion of power pur­chase agree­ments with 37 IPPs, which it said was putting about R58 bil­lion at risk.

In the court pa­pers, Eskom is the first re­spon­dent, the Na­tional En­ergy Reg­u­la­tor of SA (Nersa) – the body which sets elec­tric­ity prices – is the sec­ond re­spon­dent, the En­ergy Min­is­ter is the third re­spon­dent and 35 in­de­pen­dent power pro­duc­ers are also listed as re­spon­dents.


In the pa­pers, the CTF wants Eskom, the des­ig­nated buyer of elec­tric­ity from IPPs to be in­ter­dicted from sign­ing any power pur­chase agree­ments with the 35 en­ti­ties in the fourth bid win­dow and on­ward in­clud­ing small projects.

It said the in­ter­dict was pend­ing Nersa’s de­ci­sion taken in terms of Sec­tion 10 of the Na­tional Reg­u­la­tor Act 40 of 2004 to agree­ments in re­spect to the need for new gen­er­a­tion ca­pac­ity, the types and sources from which elec­tric­ity was needed, as well as the peo­ple to whom the elec­tric­ity gen­er­at­ing li­cences should be is­sued among oth­ers.

Nersa’s head of com­mu­ni­ca­tions, Charles Hle­bela, de­clined to com­ment yes­ter­day.

‘Hold horses’

Eskom spokesper­son, Khulu Phasiwe, said the gov­ern­ment had asked the state-owned power util­ity to “hold its horses” on the pro­gramme.

“It is clear that the en­ergy de­part­ment wants us to sign the IPP pro­gramme, and it will tell us once it has a way for­ward of the process. They are try­ing to come up with a way for­ward to de­ter­mine scale and pace of the process,” he said.

The fil­ing of the pa­pers comes af­ter the En­ergy Min­is­ter Mmamoloko Kubayi de­layed the process say­ing she wanted to speak to Min­is­ter of Pub­lic En­ter­prises Lynne Brown first.

It was re­ported that deputy di­rec­tor for pol­icy plan­ning in the En­ergy De­part­ment, Ompie Aphane, told par­lia­ment last week that there were six steps that needed to be com­pleted first.

Among the steps listed was the need to up­date the in­te­grated re­source plan to de­fine the “pace and scale of new gen­er­a­tion ca­pac­ity”. This Aphane said would be com­pleted by next Fe­bru­ary.

It was re­ported that Aphane had said that the prob­lem was that the projects re­sulted in “a higher cost to Eskom than it could re­cover through tar­iffs paid by its cus­tomers”.

The coun­try is ex­pect­ing coal con­sump­tion to be re­duced to 10 mil­lion tons by 2021 as part of gov­ern­ment’s pol­icy and in line with the coun­try’s cli­mate change com­mit­ment.

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