The South African Local Government Association (Salga) says it is taking decisive action to close the electricity gap and help municipalities take advantage of the policy shift in energy generation, with regulations having changed to allow municipalities to procure power independently to ensure energy security of supply.
Several municipalities are already in the process of procuring power independently.
Salga is collaborating with the United States Agency for International Development Southern Africa Energy Program to provide technical assistance and capacity building as part of its efforts to support municipalities in managing existing energy infrastructure, increasing electricity access, introducing novel energy solutions and initiating the just energy transition (JET).
“Although it is our wish, not all municipalities will enter the space at the same time, because there are various factors relating to playing in the independent power producers (IPP) space, some of which are financial stability or a healthy balance sheet, the resources for generation in the jurisdiction such as solar irradiance, land, wind and landfill, among others,” says Salga Electricity, Energy and Public Works Working Group councillor Tebogo Hlakutse.
A two-day session was held from September 20 to 21, in Secunda, Mpumalanga, aimed at supporting municipalities in the province to increase awareness and understanding of the JET.
The transition of South Africa’s energy sector from a coal-based economy towards cleaner sources of energy will have a direct impact on the electricity value chain in local government, Salga outlines.
It also notes the need for municipalities to have concrete plans to access climate funding to adapt to the transition.
Municipalities will also require an appropriate portion of the proposed $8.5-billion JET climate financing package in support of a local government just transition, Salga posits.
Salga says President Cyril Ramaphosa has pronounced that government is working to cut red tape for the registration of new power projects and announced plans to resuscitate the Renewable Energy Independent Power Producer Procurement Programme to substantially increase investment in wind and solar power.
“While the President’s plans lacked details on the role of municipalities in addressing the country’s energy security, Salga is forging ahead with its new generation capacity-building programme aimed at capacitating municipalities to be ready for the future energy landscape,” it emphasises.
Salga says it is confident that, with the support that it is providing, eventually, it will have more than 50% of municipalities ready to participate in the space of IPPs, even though it will be impossible for all of them to be in a position to buy from IPPs owing to financial sustainability challenges.
“Salga has played its advocacy role in the shift in the national policy to allow for the private sector to play in the generation space, and also for municipalities to be able to buy not only from Eskom but also from IPPs,” Hlakutse says.