DA calls on Minister Mantashe to set the record straight on the future of Independent Power Producers
19 November 2019
The Democratic Alliance (DA) welcomes the decision by the Department of Energy and Mineral Resources giving provinces an opportunity to make presentations on the Integrated Resource Plan (IRP). We further commend the Department on extending an opportunity to provinces to raise their challenges as it pertains to energy security.
We can only hope that the Department will take these presentations and concerns to heart in order to facilitate a move towards diversifying and stabilizing the nation’s energy sector.
The DA therefore calls on Minister Gwede Mantashe to set the record straight and clarify his position on municipalities purchasing from Independent Power Producers (IPPs). The Minister must also confirm whether he will make a Section 34 determination ahead of the City of Cape Town’s court case against himself and the National Energy Regulator of South Africa (Nersa). The DA-led City of Cape Town is seeking a Section 34 determination, in accordance with the New Generation Capacity Regulations in the Electricity Generation Act, to allow the metro to procure renewable energy from IPPs.
The DA is of the firm view that energy security can only be realized if capable municipalities are able to procure electricity produced by IPPs and feed it directly into the municipal distribution system. This will open a new window of opportunity towards a more diverse, clean, competitive and efficient energy sector.
Eskom’s monopoly over the energy sector and its exclusive rights to resell energy procured from IPPs needs to be broken. The DA’s Cheaper Electricity Bill proposes that Eskom is split into two entities: generation and transmission/distribution. The generation entity will be privatised in an effort to break Eskom’s monopoly on the production of energy, allowing IPPs to compete on an equal footing in the generation sector.
The indicators have been there for all to see, Eskom in its current form, has failed. It is clearer than ever that the utility’s monopolistic hold on South Africa’s electricity sector is hampering the country’s progress and that persistent rolling blackouts will continue to have severe repercussions on the lives of all South Africans.
The DA believes South Africa’s over reliance on coal as a primary source of energy needs to be reduced drastically because the effective functioning of our economy is only possible with the availability of reliable and stable power supply. Should provinces be given a opportunity to explore a diverse energy mix it could potentially give our ailing economy some chance to recovery.
The DA will keep a keen eye on the developments in this regard, as we are of the view that municipal access to IPPs and the restructuring of Eskom is the only way towards energy security in South Africa.
Issued by Kevin Mileham, DA Shadow Minister of Energy and Mineral Resources, 19 November 2019
