Cape Town wants to get off Eskom’s grid as part of South Africa’s new energy deal

The City of Cape Town says it is keen to engage energy minister Gwede Mantashe to get clarity on the country’s new procurement plans.

This comes after government gazetted ministerial determinations that will enable the development of more than 11,800 megawatts (MW) of additional power generation on Friday (25 September).

“This is a positive step that the national government has taken to show South Africa’s commitment to garnering cleaner energy and to diversify the energy mix.

“We are optimistic about the opening of the energy market, given Presidents Ramaphosa’s statement of intent at the State of the Nation Address in which he called for municipalities to be given more opportunity to generate their own power,” the city said.

The city said it awaits an engagement with national government for clarity on the roles and responsibilities of local governments in energy procurement.

“The city maintains that local governments have the constitutional power and obligation to procure renewable energy and this is necessary to move away from the sole reliance on Eskom for energy supply and that cities, being the growth engines of the economy, should have a say in the energy mix, especially looking at cleaner, more sustainable and more affordable options.

“We will keep standing up for residents and businesses whose livelihoods depend on a reliable energy supply and we hope to get the chance to engage and to get more clarity.

“The city has been engaging National Treasury on the development of a national municipal renewable energy procurement programme,” it said.

Court case 

The city has previously approached the country’s courts to secure South African municipalities the legal right to select their electricity suppliers has been set back by a court ruling that it must first exhaust negotiations with the government on the matter.

The city currently has to buy all its electricity from national utility Eskom, which generates most of its output from coal and is struggling to keep pace with demand.

In August, the North Gauteng High Court chose not to rule on the merits of our application challenging the applicability and constitutionality of the requirement in Section 34 of the Electricity Regulation Act that a ministerial determination is necessary before power may be procured from independent power producers.

Instead, the court ruled the city and the government should follow intergovernmental channels to clarify the roles and responsibilities.

“Essentially the judge didn’t deal with the substantive constitutional decision. It does mean more delays,” said Nicole Loser, a lawyer with the Centre for Environmental Rights, which presented evidence to back up the city’s case. “It’s a procedural judgement.”

Had it won the case, the city of four million people had planned to set up its own power-purchasing office, which would secure supplies within six years, Bloomberg reports.

That would have paved the way for other municipalities to follow suit and eroded revenue for Eskom, which is already failing to generate enough revenue to cover its costs and is reliant on government bailouts to continue operating.

Read: South Africa has just taken a big step to end load shedding: Ramaphosa

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Cape Town wants to get off Eskom’s grid as part of South Africa’s new energy deal