Karpowerships: Contract could be reduced to 10 or 5 years

Government is considering lowering permit periods for Karpowerships to below 20 years, says the head of project management in the Presidency, Rudi Dicks.

The Turkish energy company was initially set to moor its ships at Saldanah, Koega and Richards Bay for 20 years as government races to procure power.

Poweships ’emergency intervention’

Addressing the media on Tuesday, as part of Operation Vulindlela report back, Dicks said Electricity Minister Kgosientsho Ramokgopa is talking to the energy company.

“The term for this project has come out quite clearly in Necom [National Energy Crisis Committee].

“The initial term has been 20 years, Necom has taken a view that a shorter term period would have to be looked at, potentially between five to 10 years.

“It’s because this is an emergency intervention. We are looking into ending load shedding, reform and restructure the electricity sector.

“This goes to the heart of as to whether one has to sign a  20-year permit,” he said.

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Minerals and Energy Minister Gwede Mantashe has been in favour of the ships, saying they are the answer to load shedding.

President Cyril Ramaphosa also supports the multi-billion rand project.

Karpowership is seeking to supply South Africa with at least 1.2 gigawatts of energy.

It is yet to receive an environmental assessment green light from the Department of Environmental Affairs.

Concerns over transmission company delays

Minister in the Presidency Khumbudzo Ntshavheni expressed concerns over the slow unbundling of ailing power utility, Eskom, and the operation of the National Transmission Company of SA (NTCSA).

However, the NTCSA is yet to receive a license from the National Energy Regulator (Nersa).

“We are not happy with the progress, we want them to start establishing a board so that they can start working immediately when permission is granted.”

Eskom’s unbundling was first announced by the Department of Public Enterprises in 2019.

Government ambitiously announced that the entity would be split into power generation, transmission and distribution by the end of this year.

READ MORE: Eskom latest: R400bn debt relief and Mantashe on taking Karpowership ‘seriously’