Radebe tells municipalities to go the DIY route for electricity

The solution to South Africa’s energy crises and mounting municipal debt to Eskom – which stands at over R17 billion – is for municipalities to generate their own electricity, Minister of Energy Jeff Radebe said at the Africa Energy Indaba in Sandton yesterday.

During his keynote address, Radebe said since municipalities were struggling to keep up with their payments for bulk electricity purchases from Eskom, they should develop their own alternative energy systems.

“Municipalities are also keen to generate their own power, albeit on a small scale. As wholesale electricity tariffs rise, or as we fail to provide electricity for the residential sector, we can expect more rooftop PV [photovoltaic] systems, biogas, waste to energy and wind turbines to be installed at municipal level,” said Radebe.

He said unless municipalities became more financially viable, the country would experience more service delivery failures which could cripple the economy further and reduce investor confidence.

“The so-called last mile for the delivery of electricity occurs at municipalities.

“The municipal electricity business model has invariably come under severe financial pressure as wholesale tariffs increase, as residents fail to pay for services and as municipal revenue collection systems prove even more inadequate.

“Unless the problem relating to municipal financial viability is arrested, we run the risk of more and more African municipalities failing to provide basic services,” he said.

The minister said his department would provide the policy and regulatory framework for municipalities to develop their own generation and alternative energy systems.

“In November 2017, we promulgated amendments to Schedule 2 of the Electricity Regulation Act, relating to circumstances under which a generation licence may not be required.

“The Schedule 2 amendments address the constraints related to licensing of potentially hundreds of thousands of rooftop PV systems, biogas and other small scale embedded generators.

“Critically, we provide the policy and regulatory framework for municipalities to develop their own generation and we enable the orderly development of alternative energy systems, which municipalities are developing already anyway,” he said.

The Africa Energy Indaba is a platform to discuss, debate and seek solutions to enable adequate energy generation across Africa. The conference draws delegates from all continents who compromise industry experts, project developers, financiers, energy users, government officials and energy industry manufacturers.”

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