KEETMANSHOOP will not renew an exclusive 15-year power supply contract with the Southern Electricity Company (SELCo) when it expires in February 2016.
For his part, SELCo’s managing director Chris Bosch said his company would also not seek renewal, citing losses of N$1,7 million during the 2011 financial year as a reason.
However, Bosch showed interest in a partnership with the council to explore possibilities of setting up a power generation plant.
Keetmanshoop Mayor Moses Titus made the announcement at a community meeting on Thursday, while giving feedback on talks the council recently held with SELCo’s bosses in Johannesburg, South Africa.
“The issue about the contract renewal has been concluded, we’re not going to talk about it anymore,” said Titus.
Local residents were relieved by the news marking the end of the controversial power deal, which was clinched after SELCo gave the council N$5 million to upgrade its electricity grid.
Escalating electricity tariffs since then have triggered protests by local residents.
In 2008, the council unilaterally terminated the agreement. But SELCo won an interim High Court order returning the electricity provision to it. The High Court still has to deliver a final judgement in the matter.
Titus also announced that the parties had agreed to set up a steering committee that would work on an exit strategy during the remainder of the contract.
The steering committee will also explore ways of reducing electricity tariffs by looking at the possibility of setting up a power plant.
Titus said the council had been looking for a partner to investigate the possibility of setting up a power plant partly or wholly owned by the municipality.
“We do not have the expertise to start such a project or money to acquire such skills. We therefore talked [with SELCo] about expansion in that regard without any reference to the current agreement,” Titus said.
Titus rejected allegations that the council was about to sell out its residents to SELCo.
“We are not sellouts and will never sell out to any one. This council will not entertain any consideration with regard to the current agreement with SELCo. We’re committed to the ideals of the residents of Keetmanshoop as long it is reasonable,” Titus said.