Ramaphosa gives private companies green light to produce more electricity

Johannesburg – As the power cuts continue to cripple the economy and disrupt ordinary life, President Cyril Ramaphosa has announced an amendment to the Electricity Regulation Act, which will allow private sector players to generate more power, as Eskom struggles to keep the lights on.

The amendment means that the National Energy Regulator of South Africa (Nersa) threshold for generation of electricity by private players moves from 1MW to 100MW.

“The amended regulations will exempt generation projects up to 100MW in size from Nersa licensing requirement, whether or not they are connected to the grid. This will remove a significant obstacle to investment in embedded generation projects,” said Ramaphosa.

“Generators will also be allowed to wheel electricity through the transmission grid, subject to wheeling charges and connection agreements with Eskom and relevant municipalities,” he added.

Also read: Worst economic crisis in recent history, Ramaphosa says as he tackles SA’s energy problems

Ramaphosa said generation projects still needed to obtain a grid connection permit to ensure that they meet all the requirements for grid compliance.

Generators, the president noted, would also be allowed to wheel electricity through the transmission grid, subject to wheeling charges and connection agreements with Eskom and relevant municipalities.

“Generation projects will also need to have their registration approved by the regulator to verify that they have met these requirements and to receive authorisation to operate.
Municipalities will have discretion to approve grid connection applications in their networks, based on an assessment of the impact on their grid.

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