Court date set for City energy purchase case

21 May 2019

The City of Cape Town is pleased that the date of 18 June 2019 has been set for its hearing on being allowed to purchase power from independent power producers (IPPs) and not only from Eskom. The City is fighting for the right to buy cleaner energy directly from IPPs. Read more below:

In the court matter, the City is asking the Minister of Energy and the National Energy Regulator of South Africa (Nersa) to allow it, and municipalities across South Africa, to buy energy from IPPs in light of Eskom’s inability to provide for a reliable and cleaner energy supply to the residents and businesses of Cape Town. 

‘Metros simply must be the energy champions of their residents and of their commercial sector players. It is a right which is entrenched in the Constitution of the country and the City intends on providing its customers with the option of cleaner energy supply while combating both rising electricity tariffs and the impact of climate change. Energy derived from fossil fuels is responsible for roughly half of the greenhouse gases released worldwide,’ said the City’s Mayoral Committee Member for Energy and Climate Change, Councillor Phindile Maxiti.

The City maintains that it will be vital for the national government to open up the electricity generation environment if cities are to be able to reduce carbon emissions and if the security of power supply is to be achieved.

This is not just a Cape Town fight. As a city, we encourage all other metros, being the growth engines of our country, to join us and to actively participate in constructive responses to mitigate the impact of the electricity supply shortage in the commercial sector especially.

We simply cannot afford the devastation that load-shedding has had on our economy as a city and as a country.

It is vital that we future-proof our City to ensure that security of supply, and cleaner supply at that is enhanced. The City, therefore, wants a Section 34 determination in accordance with the New Generation Capacity Regulations in the Electricity Regulation Act to allow us to procure 150 MW of solar energy and 280 MW of wind energy from IPPs.

If successful in our court challenge, the City would opt for a public tender and solicit proposals from IPPs.

The price of power generated from IPPs would differ based on technology. It is foreseen that the City would then periodically advise on new tenders with new prices for power to be purchased, based on prevailing and predicted market trends.

For the sake of our country’s economy, the entire electricity regime urgently needs to be restructured. The City is ready to be part of that change and move towards a low carbon, diversified and decentralised energy system.

Issued by Greg Wagner, Spokesperson for Executive Mayor Dan Plato, 21 May 2019