DA to PAIA NERSA’s decision to grant generation licences to Karpowership
23 September 2021
Following the admission by Nhlanhla Gumede, NERSA’s Regulator Member responsible for electricity regulation, on Radio 702 that Karpowership was granted generation licences despite not having a complete set of the requisite documents, permits and authorizations, the DA will be submitting a Promotion of Access to Information Act (PAIA) to NERSA requesting that it provides a comprehensive record of its decision to grant these licences.
For an electricity generation application to be successful, Section 10 (2)(e) of the Electricity Regulation Act clearly states that a potential applicant should include "the plans and the ability of the applicant to comply with applicable labour, health, safety and environmental legislation, subordinate legislation and such other requirements as may be required." NERSA's own FAQ on electricity generation licences clarifies that this includes a signed Power Purchase Agreement (PPA) and Records of Decision for environmental authorizations.
By his own admission, Mr Gumede inadvertently confirmed that NERSA failed to comply with this statutory requirement. Instead, the energy regulator went ahead and granted generation licences to Karpowership despite being aware that the company did not have environmental approval, appropriate permits from the National Ports Authority and power purchase agreements from Eskom.
NERSA’s actions are in clear breach of its statutory obligations and should information from the PAIA application reveal any infringement of regulatory processes, all regulators who were part of this decision should be held accountable.
It is curious and indeed concerning that regulators and the government are bending over backwards to ensure that the Karpowership deal is pushed through at all costs. The deeply flawed Risk Mitigation Independent Power Producers Procurement Programme (RMIPPPP) should never be used as an excuse to violate South African laws and bend to the will of Karpowership.
Issued by Kevin Mileham, DA Shadow Minister of Mineral Resources and Energy, 23 September 2021
