The National Energy Regulator of South Africa (Nersa) has provided clarity on the regulatory requirements for small-scale embedded generation (SSEG), the electrical generation facilities grid.
Nersa’s response comes after Organisation Undoing Tax Abuse (Outa) had last week Tuesday criticised Eskom. It described the recent “threats” by the power utility and some municipalities to fine and disconnect electricity supply of users for failing to register their SSEG systems as impractical, irrational and unfair.
In a statement, Nersa said it wished to clarify the applicable regulatory position to avoid public confusion. To also ensure consumers, installers and other stakeholders are correctly informed of the legal requirements governing embedded generation.
Regulation clarified
“According to the Electricity Regulation Act of 2006 (as amended), read with the exemption and registration notice, the requirement to register an embedded generation facility is determined by whether the installation has a point of connection to the electricity grid and its installed capacity and not by whether electricity is exported to the grid or consumed on site,” Nersa’s statement read.
According to the regulator, small-scale embedded generation facilities with an installed capacity of 100kW or less, with a point of connection to the electricity grid, are required to register with the relevant distributor such as Eskom or the applicable licensed municipality.
“Embedded generation facilities with an installed capacity of more than 100kW and a point of connection to the grid are required to register directly with Nersa. Embedded generation facilities without a point of connection to the electricity grid are exempt from registration requirements. These regulatory requirements exist to support the safe, reliable and efficient operation of the electricity system. Including compliance with applicable technical standards, system planning and network protection.
“A certificate of compliance confirms that an installation meets electrical safety requirements. Registration serves a distinct regulatory purpose and does not duplicate safety certification processes,” said the regulator.
Network protection at heart of new rules
Nersa also outlined the rationale behind the rules related to SSEG. It noted that registration was not intended to discourage the uptake of renewable energy technologies. Instead, the aim was to ensure that integration of embedded generation occurs in a manner that protects the integrity of the electricity network and the interests of all electricity users.
“Nersa remains committed to enabling South Africa’s transition to a more diverse and sustainable electricity supply. While ensuring compliance with the legislative and regulatory framework. Stakeholders are encouraged to engage with their licensed distributors or Nersa directly. For accurate guidance on registration requirements.”
Last week, Outa said solar users should not register with Eskom or municipalities.
The organisation also raise concerns over unclear SSEG requirements. It said these were creating confusion, anxiety and project delays for homeowners and installers. And it pointed out that safe, compliant solar installations behind the meter should not face coercive enforcement.
“Outa believes recent threats by Eskom and certain municipalities to fine or disconnect electricity supply for failing to register their small-scale embedded generation (SSEG) systems (Solar PV) are impractical, irrational and unfair.
Outa concerns over uncertainty
“We have also noticed significant amendments to earlier supposed requirements and deadlines by the authorities, which is generating more uncertainty and ambiguity on their demands and threats to households with solar installations,” said Outa CEO, Wayne Duvenage.
The organisation also said it had received a surge of queries and concerns from the public. This is following what it called threatening communications from Eskom and certain municipalities. And this includes the City of Johannesburg demanding registration or prior approval for SSEG installations under 100 kW, which do not feed electricity back into the grid.
“This has created unnecessary uncertainty, confusion and anxiety for households, installation companies and other industry stakeholders. What is at stake here, are the rights of citizens who have gone to significant personal expense to protect themselves against years of escalating electricity prices and an unreliable power supply. People have installed gas appliances, solar power systems, generators, inverters and other alternatives, in direct response to Eskom and government’s calls – as well as incentives – to reduce electricity demand,” said Duvenage.
Impact of uncertainty
He further said the uncertainty had knock-on effects. Thus leading to solar installation projects being delayed, with some solar installation financiers, insurers and installers being unsure how to proceed.
“Outa’s position is clear. What a homeowner does behind the meter on their own property – to reduce reliance on an unstable and expensive electricity supplier is of no real business to the supplier. Provided the installation is safe, compliant in terms of national legislation, and the customer continues to pay for electricity in line with their contract with the distributor.
“This means that if your solar installation has a valid CoC, which addresses the safety concerns that are often cited by Eskom and municipalities, you are doing what is required of you,” said Duvenage.
