The National Energy Regulator of South Africa has granted an operating license to Karpowership SA.
The National Energy Regulator of South Africa has granted an operating license to Karpowership SA.

Mixed reactions as Nersa grants operating licence to Karpowership SA

By Gcwalisile Khanyile Time of article published Sep 23, 2021

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Durban - RICHARDS Bay community representatives have welcomed the National Energy Regulator of South Africa’s (Nersa) decision to grant operating licences to Karpowership SA for the three of the country’s ports. However, environmentalists and the DA have condemned the decision.

Karpowership SA won the preferred bidder status for three power generation projects in Coega, Richards Bay and Saldanha Bay, and promised to inject R18 billion in investment directly into local communities.

The Karpowership SA plan was seen as offering a solution to the instability of the national grid, which would help Eskom overcome the shortage in electricity supply.

In a statement on Tuesday, Nersa said it had approved the issuing of generation licences for the seven Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP) preferred bidders, based on the available information and analysis conducted on the applications for generation licences by the seven RMIPPPP bidders.

Nathi Nzimande, the Economic Transformation Committee chairperson in the Musa Dladla Region, welcomed the approval as good news.

“We have always maintained that we welcome any kind of support and investment offered to the community. If the project promises to create jobs, skills development and partnership with SMMEs, we want it,” Nzimande said.

He added that he had trust in the country’s institutional arrangements as there were certain permits that must be obtained, prior to the inception of the project.

He also complained that electricity outages hampered small, medium and micro enterprises (SMMEs).

Sakhowakhe Chonco, the provincial treasurer of the National African Federated Chamber of Commerce and Industry (Nafcoc), also welcomed Nersa’s decision.

“It will empower the youth. We are concerned about the safety issues, but there are regulations which should be followed to protect the environment.”

He said they wanted all due processes to be followed, and that a balanced approach was needed to rebuild the economy.

DA spokesperson on Mineral Resources and Energy, Kevin Mileham, condemned Nersa’s decision. He said it was public knowledge that Karpowership did not have environmental approval, the appropriate permits from the National Ports Authority, and that Eskom had not signed power purchase agreements with them.

“The DA questions whether Nersa’s decision in this regard is not premature, and whether the regulator has rubber-stamped the now deeply flawed RMIPPPP,” Mileham said.

Liz McDaid of the Green Connection said Nersa’s decision was flawed and not in the public interest.

“This is a 20-year deal. It will affect future generations, their lifestyle and their affordability levels. We need to ensure that it is not the public that pays for the price variability due to external issues related to dollar/rand and LNG fuel variability, and carbon taxes,” McDaid said.

She added that Nersa could not ignore climate change in its decision-making.

In a statement, Karpowership SA thanked Nersa for the way it had undertaken its work, and said it looked forward to continued co-operation with government authorities to conclude the remaining licence and permit applications.

It said the power generation licence approval was a very important milestone for the preferred bidders, as it moved them one step closer to their goal of providing South Africa with sustainable, cleaner, and affordable energy.

Daily News

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