Sona, The City Of Cape Town And Eskom
Category February Newsletter 2020
The State of the Nation and the state of Eskom are inextricably linked; without an affordable, reliable and constant supply of electricity, we face a broken economy and ultimately a broken nation.
While the future of Eskom is hampered by political battles and vested interests, President Ramaphosa has recognised the need for independent power production and in his State of the Nation Address this month stated that municipalities in good financial standing may purchase power from sources other than Eskom. This is very good news for the residents and businesses in the City of Cape Town.
The City of Cape Town has responded with cautious optimism which is echoed by the Premier of the Western Cape. The City has been calling for permission to purchase power from Independent Power Producers for some time and while the President's announcement aligns with this demand, Mayor Dan Plato says that detail on budget is vague. The City instituted legal proceedings against government in 2017 after requests by then-Mayor Patricia De Lille to then-Minister Tina Joematt-Petersen in 2015 were ignored. The City intends to continue with these proceedings which will be heard in the High Court on 11 May 2020. The City is seeking clarity on the restrictions which government may seek to impose on it as it is developing an ambitious energy program which would allow it to purchase 150MW of solar energy and 180MW of wind energy from the IPPs. Any restrictions like a once-off determination by government or a cap on megawatts could unfairly thwart the City's plans for a "low-carbon, diversified and decentralised and secure energy system".
The City's Energy Director says that it is a likely two-to-three year time frame for the Cape Town's independent power supply to come into effect as budget issues need to be resolved with National Treasury, various environmental impact assessments will need to be done, plant and equipment will need to be installed and purchasing agreements negotiated and signed between the City and IPPs.
We at Blue Chip feel that this is a great step forward and shall keep a watch on the outcome of the court case in May as well as developments reported by the City with great interest.
Author: Bronwen Woodward
