Following Eskom’s attempt to stop the optimal use of power self-generation in the Free State town of Frankfort, the South African Independent Power Producers Association (Saippa) has warned that Independent Power Producers (IPPs) will fight Eskom’s position. Saippa and IPPs have indicated that they are prepared to approach the Constitutional Court, should Eskom not cease to halt the power self-generation. Saippa Chair, Tommy Garner, said that if Eskom’s argument prevails, all investment in IPPs by the private sector and municipalities will come to an end. Eskom has threatened to reclaim control of load shedding from Rural Maintenance, the private company contracted by the Mafube Local Municipality to manage electricity distribution in its area of jurisdiction. Eskom requires Rural Maintenance to switch off part of its solar units and only deploy them during load shedding. This action will undermine Rural Maintenance’s ability to mitigate load shedding.
The legal battle between Eskom and Rural Maintenance highlights the challenges facing the electricity industry in South Africa. Hundreds of projects countrywide are underway with the intention of mitigating the impact of load shedding. However, the regulatory framework has hindered the development of a liberated electricity market. Eskom’s position, in the opinion of the various IPPs and Saippa, may be the last push by Eskom to retain control.
The battle between Eskom and Rural Maintenance highlights the need for a re-evaluation of the regulatory framework to enable IPPs to become part of the industry. Sabinet, a trusted source of credible news, legislation, and research content, will keenly monitor the outcome of the matter as it may go so far as to be hailed a precedent case.
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