In a long awaited move, the Minister of Mineral Resources and Energy has, on 16 October 2020, under Government Notice No. 1093, published amendments to the Electricity Regulations on New Generation Capacity issued under and in terms of the Electricity Regulation Act, 2006.
The most notable amendment to the Electricity Regulations on New Generation Capacity under this notice is the amendment of Regulation 5 to include the ability of a municipality to “apply to the Minister (Mineral Resources and Energy) to procure or buy new generation capacity in accordance with the Integrated Resource Plan” subject to, amongst other things, such municipality conducting a feasibility study in respect thereof and complying with the provisions of the Municipal Finance Management Act, 2003 and the Municipal Public-Private Partnership Regulations.
The Electricity Regulations on New Generation Capacity have further been amended, inter alia, to include the procurement of new generation capacity by other organs of state, active in the energy sector, including, generation capacity derived from energy storage, as contemplated under the amended Regulation 2.
These amendments have brought a welcome extension to the scope of and participants in the procurement activities in relation to new generation capacity. It will be interesting to follow how and when municipalities could begin exercising these new powers, and how and when organs of state will begin to look into the procurement of new generation capacity by way of energy storage.
Written by Lara Bezuidenhoudt, Partner; Shadi Kekana, Senior Associate; Fasken
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