19 January 2021
Statement by the City's Executive Mayor, Alderman Dan Plato
The City’s plans include building and procuring its own renewable generation capacity. We implore the Department of Mineral Resources and Energy to provide clarity on the process as soon as possible so that we can move forward with the execution of our plans.
The City also hopes to have a photovoltaic (PV) plant (solar-powered) built by the City on the ground by approximately 2022/3 if all goes according to plan, but with the current Municipal Finance Management Act and Energy Regulation Act regulations it could take up to five years from when a Determination is provided to having the first power from an IPP in our grid. Specialist studies are under way.
We are in discussions with the national IPP office to assist us in developing a framework for a municipal procurement programme for cities. We are also procuring the services of a legal firm to establish the contractual terms of the power purchase agreement to ensure its compliance with legislation, national regulatory frameworks and the City’s policy landscape. We have done a lot of work and the National Treasury supports our initiatives and also the public and transparent procurement processes we committed to from the start.
We are working with the CSIR to develop a City-level Integrated Resource Plan which will provide the optimal mix.
However, clarification is awaited on the practical implementation of the new amended regulations. Including:
- The status of own generation (municipal generation) projects is unclear, with the regulations referring only to buying and procurement of electricity and not to own generation.
- Municipalities need to understand how the regulations will be implemented within the context of the current Integrated Resource Plan (IRP) for Electricity, which is fully allocated up to 2024.
- It is not clear what timelines will apply to the processing of municipal applications by the Department of Mineral Resources and Energy, especially the time for review of feasibility studies. This still needs to be clarified to ensure implementation without lengthy delays.
The City has always maintained 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.