ANC thinks municipalities should buy their own electricity - report

Business Insider SA
  • Business Day reported that the ANC has approved plans to allow municipalities to buy their own electricity. 
  • Plans were also adopted to ease rules for businesses to generate electricity, and to expand the IPP programme. 
  • The DA-run City of Cape Town took the department of energy to court in 2017 to allow the city to procure its own electricity. 
  • For more stories go to the Business Insider South Africa homepage

The African National Congress (ANC) has reportedly approved plans to allow municipalities to buy their own electricity and to make it easier for businesses to generate their own electricity. 

This as the country’s embattled power utility Eskom is struggling to avoid load shedding, with unplanned outages reaching 12,812 MW on Tuesday morning - well above Eskom’s own 9,500 MW threshold to avoid load shedding.

At the same time, Eskom spends as much as R27 to buy one kilowatt-hour (kWh) of electricity from private diesel turbines to keep lights on, while the average selling price is roughly R1 per kWh.

Business Day reported that the ANC’s two-day lekgotla endorsed the plans to ease the regulation of businesses to generate their own power, to allow municipalities to buy their own power, and to expand the current Independent Power Producer (IPP) programme.

At the lekgotla, attended by directors general, mayors, premiers, ministers as well as alliance partners, public enterprises minister Pravin Gordhan emphasised the need for Eskom to start allowing private electricity generators and private equity partners, News24 reported.

Also read: Eskom’s new boss officially starts today – here’s what we know about André de Ruyter

The DA-run City of Cape Town approached the courts in 2017 to force the department of energy to allow it to procure its own electricity from IPPs. The case is set to be heard in May. 

The department of energy, which is opposing the application by the City of Cape Town, has not responded to Business Insider enquiries on why it is opposing the case. 

South African businesses have also for a long time called on the state to allow it to produce its own electricity in light of Eskom’s unpredictability, and the country’s poor economic circumstances.

Eskom plunged South Africa into darkness at the beginning of January, when electricity demand is typically lower due to the festive season, due to a high number of unplanned breakdowns.

(Compiled by James de Villiers)

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