Categories: IPP, IRP

by Peter

Share

Categories: IPP, IRP

by Peter

Share

City of Cape Town drafting ‘mini IRP’ as it prepares way for IPP procurement

2ND OCTOBER 2020

BY: TERENCE CREAMER
CREAMER MEDIA EDITOR

ARTICLE ENQUIRY      SAVE THIS ARTICLE      EMAIL THIS ARTICLE

FONT SIZE: +

The City of Cape Town, which has been pushing for the right for municipalities to procure electricity directly from independent power producers (IPPs) for several years, is currently compiling what it describes as a “mini” integrated resource plan (IRP) to guide its future procurement decisions and actions.

Energy and climate change executive director Kadri Nassiep reports that the city has contracted the Council for Scientific and Industrial Research to develop the mini IRP, which he says should be completed within six to eight months.

ADVERTISEMENT

Speaking during a webinar organised by the Italian-South African Chamber of Trade and Industries, Nassiep stressed that the procurement of electricity from large-scale IPPs remained a key objective, despite the prevailing legal and regulatory constraints preventing municipalities from doing so.

The city took the matter to court recently after the National Energy Regulator of South Africa (Nersa) informed it that it could not license an IPP to establish new generation capacity in the absence of a specific determination catering for such capacity from the Mineral Resources and Energy Minister.

ADVERTISEMENT

On August 15, Judge Leonie Windell referred the dispute back to the parties, including Nersa, the Minister of Minerals Resources and Energy and the City of Cape Town, for resolution. She did so in terms of Section 41(3) of the Constitution, which  requires all spheres of government to strive to adhere to the principle of cooperative governance, and Section 41 of the Intergovernmental Relations Frameworks Act, 2005.

Windell left the way open, however, for any party to return to the court to seek further relief in the event that the dispute was not resolved through engagement or a possible dispute-resolution process.

Nassiep indicated that the city was concerned that the most recent Ministerial determinations, opening the way for the procurement of more than 13 800 MW of new IPP electricity, still listed Eskom as the sole buyer.

Nevertheless, he noted that scope for municipal IPP procurement was likely to open up in future, given that the Electricity Regulations on New Generation Capacity were in the process of being amended to allow municipalities to develop or procure their own power generation. 

The city wanted the right to procure from IPPs as part of a broader plan to diversify its electricity supply away from Eskom, as well as to reduce its carbon footprint and electricity costs over the medium to long term.

Besides IPP procurement, the city was also working on plans to develop its own generation mostly from ground-mounted solar photovoltaic plants of between 1 MW and 10 MW in size.

In parallel, initiatives were under way to reduce the energy consumption of public and private buildings and enhance the city’s embedded generation programme, through which businesses and households can feed electricity into the municipal grid.

Despite these plans, Eskom would remain the provider of about 70% of the city’s power over the medium term, Nassiep stressed.

Besides developing the mini IRP, the city was also working with the National Treasury on a framework for a municipal-led renewables procurement programme along the lines of the national government’s Renewable Energy Independent Power Producer Procurement Programme.

“We are proposing the establishment of a sustained, credible, planned and coordinated national procurement programme for municipalities that takes into account the national demand and supply options and constraints.”

Nassiep cautioned, however, that its internal assessment points to the likelihood that it could take up to five years before the first IPP power procured by the municipality was integrated into the municipal network. 

STAY IN THE LOOP

Subscribe to our free newsletter.

Business Report 1 July 2012. Optimal Energy chief executive Kobus Meiring is a disappointed man. The company is the developer of South Africa’s electric car but it officially closed on Friday with the loss of about 60 jobs. This follows its failure to get further funding from the government and the Industrial Development Corporation (IDC)... http://www.iol.co.za/business/business-news/why-sa-s-electric-car-is-not-going-anywhere-1.1331580#.T_E37xcjGq8

Related Posts

  • Ramaphosa doubles next renewables round, scraps 100 MW cap on distributed plant and moots feed-in tariff as he unveils load-shedding crisis response President Cyril Ramaphosa 25TH JULY 2022 BY: TERENCE CREAMER CREAMER MEDIA EDITOR ARTICLE ENQUIRY      SAVE THIS ARTICLE      EMAIL THIS ARTICLE FONT SIZE: –+ President Cyril Ramaphosa unveiled several far-reaching interventions – including a doubling in the allocation for the next renewables […]

  • South Africa’s electricity plan ‘underestimating’ new generation needs, former Eskom CEO warns Photo by Creamer Media Chief Photographer Donna SlaterEskom CEO Andre de Ruyter (with mic) speaks during an energy transition breakaway session at the South Africa Investment Conference 2022 25TH MARCH 2022 BY: TERENCE CREAMERCREAMER MEDIA EDITOR ARTICLE ENQUIRY      SAVE THIS ARTICLE      EMAIL THIS ARTICLE FONT SIZE: –+ South Africa’s current Integrated […]

  • Sasol and Air Liquide initiate first phase of 900 MW renewables procurement process Photo by Creamer MediaPower lines in the foreground, with Sasol's Secunda complex in the background 13TH APRIL 2021 BY: TERENCE CREAMERCREAMER MEDIA EDITOR ARTICLE ENQUIRY      SAVE THIS ARTICLE      EMAIL THIS ARTICLE FONT SIZE: –+ Sasol and Air Liquide have formally announced plans to jointly procure 900 MW of renewable-energy […]

  • DMRE delays release of renewables bid documentation Photo by Creamer Media 1ST APRIL 2021 BY: TERENCE CREAMERCREAMER MEDIA EDITOR ARTICLE ENQUIRY      SAVE THIS ARTICLE      EMAIL THIS ARTICLE FONT SIZE: –+ The release of the request for proposal (RFP) documentation for Bid Window 5 (BW 5) of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) has been delayed, the Department of Mineral […]