Projects and Energy Weekly Snippets

Weekly projects and energy updates in South Africa

Eskom faces intensified scrutiny over Molefe's reappointment

Eskom is facing multipronged investigations into its reappointment of Brian Molefe as CEO, with Parliament's public enterprises committee deciding on Tuesday to institute an urgent parliamentary inquiry into the matter.

The inquiry could be along the lines of the one into the SABC and may see Molefe being called to face questions in Parliament, of which he was a member until earlier this month.

Business Day, 24 May 2017

SA's renewable energy auction system "the best in Africa"

"South Africa's renewable energy auction system is the best in Africa and has provided a platform that can be used to support similar projects in other countries on the continent," says African Development Bank (AFDB) president Akinwumi Adesina.

The AFDB led a group of eight other banks to provide a syndicated A/B loan for US$965m to Eskom that hinged on the power utility's commitment to renewable energy.

Business Day, 23 May 2017

Independent Power Producer office to be shifted

The Independent Power Producer office, responsible for the government’s shining success story – the renewable IPP programme – is to become a subsidiary of the Central Energy Fund (CEF), new Energy Minister Mmamoloko Kubayi announced on Friday.

The programme attracted ZAR196 billion in investment between 2011 and 2015, when it stalled after Eskom opposed the signing of further power purchase agreements with producers.

It had, however, been criticised for its failure to create significant black participation at ownership level.

Business Day, 22 May 2017

Power Africa seeks to increase SADC electricity access

Power Africa launched a five-year project titled, Southern African Energy Programme, designed to increase the supply of and access to electricity in Southern Africa at the African Utility Week last week.

The USAID-funded project consists of a consortium led by Deloitte and includes McKinsey, Another Option, CrossBoundary, and Worley Parsons, a press release stated.

ESI Africa, 22 May 2017

Now Eskom wants regulations over tariffs set aside when it asks for more money

South Africa's National Energy Regulator (NERSA) is soon to decide if the country's power utility, Eskom, should be granted an exemption from a long list of regulatory reporting requirements when it submits a new tariff application next month.

The reporting requirements centre around thousands of detailed cost and sales items making up Eskom's financial and regulatory accounts – information that's meant to be used by the regulator to determine electricity tariffs. Some of the reporting requirements date back to 2008 and are general to the regulated energy sector. Other information requirements were only recently put into place on the back of concerns that tariff hikes were being made without full disclosure.

Eskom has asked the regulator to waive some of the requirements for its 2018/19 tariff application. It argues that its internal reporting systems aren't tailored to the format required by the regulator, and that they need to be revised. But that will take time, and Eskom's only chance for lodging a tariff application is for NERSA to provide it with the exemption.

Business Day, 22 May 2017

The above reflects a summary of certain news articles published during the preceding week. It is not an expression of opinion in respect of each matter, nor may it be considered as a disclosure of advice by any employee of Hogan Lovells.

For more information contact Charles Marais, Philip van Rensburg, or Mzimasi Mabokwe.

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