The Western Cape provincial government has welcomed the planned changes to the Electricity Regulation Act, which it says will help escalate its plans to move away from Eskom and load shedding.
Commenting on the announcement, the province’s minister of finance and economic opportunities David Maynier said that the latest round of power cuts has cost the country billions of rands.
“With load shedding costing South Africa’s economy R500 million per stage, per day, and the Western Cape’s economy R75 million per stage, per day, over the last two weeks load shedding has cost the South African economy approximately R25 billion, and the Western Cape approximately R3.85 billion,” he said.
We now need to urgently finalise schedule 2 of the Electricity Regulation Act and clarify which categories of projects are covered by the relaxation and ensure that the permitting and registration requirements do not become another regulatory spiderweb causing unnecessary delays in the delivery of additional energy supply in South Africa.”
While the move was welcomed, Maynier said that South Africa remains in an energy crisis and large-scale private sector participation in energy generation, in partnership with the government, will be key to addressing the current shortfall in the Western Cape.
This is a positive move that will give much-needed certainty to investors and increase access to affordable, renewable energy in South Africa.
On Thursday (10 June), president Cyril Ramaphosa announced that the Electricity Regulation Act will be amended to increase the NERSA licensing threshold for embedded generation projects from 1 MW to 100 MW.
“This intervention reflects our determination to take the necessary action to achieve energy security and reduce the impact of load shedding on businesses and households across the country,” he said.
“It is evidence of our intention to tackle this economic crisis head-on, by implementing major economic reforms that will transform our economy.”
Ramaphosa said that the amended regulations will exempt generation projects up to 100 MW in size from the NERSA licensing requirement, whether or not they are connected to the grid.
This will remove a significant obstacle to investment in embedded generation projects, he said.
“Generators will also be allowed to wheel electricity through the transmission grid, subject to wheeling charges and connection agreements with Eskom or the relevant municipality.”