Cape Town seeks court permission to buy electricity directly from IPPs

The City of Cape Town is seeking court permission to buy electricity directly from independent power producers (IPPs) due to the ongoing blackouts in the country.

Acting Mayor Ian Neilson said the City was asking permission from the judge president of the Gauteng High Court for an expedited hearing on its energy case asking Energy Minister Gwede Mantashe and the National Energy Regulator of South Africa (Nersa) to allow it to buy energy from the IPPs.

The original hearing date is scheduled to be heard in May 2020.

“The City is fighting for the right to buy cleaner energy directly from the IPPs to improve energy security. This move comes as the energy crisis in South Africa has reached a new peak.

“Its legal team is liaising with the legal teams of other parties with a view to approaching the judge president with mutually agreeable dates for an earlier hearing,” Neilson said.

“We note that this matter turns on the lack of NERSA and the minister being able to reach an agreement on the legal framework to allow for the issuing of a licence to the City to purchase renewable energy from the IPPs.

“Should an agreement be reached on this aspect before the proposed original date for the hearing of the matter, it will not only enable the City to move forward with its plans sooner, but it will also mean that litigation in this matter is not required,” he added.

The City assured residents it would continue to do everything possible to pursue a positive outcome.

“Metros simply must be the energy champions of their residents and commercial sector players,” Neilson said.

The City maintained it would be vital for the national government to open up electricity generation environment if the country was to restore security of power supply.

“We simply cannot afford the devastation that load shedding has had on our economy as a City and as a country. It is vital that we future proof our City to ensure that security of supply, and cleaner supply is enhanced.”

The City also wants a section 34 determination in accordance with new generation capacity regulations in the Electricity Regulation Act to allow it to procure 150MW of solar energy and 280MW of wind energy from the IPPs.

“While it will take time to procure this new capacity, the City wants to begin working on these alternatives as soon as possible.

“If successful in our court challenge, the City would opt for a public tender and solicit proposals from the IPPs in the future. For the sake of our country’s economy, the entire electricity regime urgently needs to be restructured.

“The City is ready to be part of that change and move towards a low carbon, diversified and decentralised and secure energy system,” Neilson said.

Earlier this year, then-DA leader Mmusi Maimane held a press briefing with the party’s metro leaders following a loss of 900MW from the Cahora Bassa Dam in Mozambique after a cyclone hit the area. Together with mayors Herman Mashaba, Stevens Mokgalapa and Dan Plato as well as DA Gauteng premier candidate Solly Msimanga, the DA leader spoke about plans to counter load shedding. The party has been vocal about his belief that the government should look for alternatives other than coal to produce much-needed power.

In 2017, the City indicated its plans to take then-energy minister Tina Joemat-Pettersson to court for the right to buy power directly from alternative energy suppliers instead of Eskom.

The City indicated it wanted to get 20% of its energy from renewable resources by 2020 but needed the minister to sign off on an application to get the IPPs, then-mayor Patricia de Lille said at the time. She added there were many IPPs the City could buy its energy from directly, but only Joemat-Pettersson could give the go-ahead. She, in turn, had to consult Nersa before giving the go-ahead.

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