13 March 2018

South Africa: Last-Minute Court Interdict Blocks IPP Signing

The signing of 27 independent power producer contracts on Tuesday has been put on hold, after the National Union of Metalworkers of South Africa and Transform RSA managed to obtain a last-minute court interdict.

In a statement on Tuesday morning, Numsa said the interdict prevents power utililty Eskom from concluding the outstanding renewable energy power purchase agreements.

"Numsa believes that the signing of these contracts would be detrimental for the working class of Mpumalanga and the country as a whole. The signing of the IPP means that Eskom will require less coal-fired electricity," the union said in a statement.

"This is likely to lead to the closure of the coal-fired power plants and the impact will be that at least 30 000 working class families will suffer because of job losses."

The union also claimed that the IPP roll-out would raise the cost of electricity dramatically.

Eskom referred Fin24 on Tuesday morning to the department of energy for comment. The department did not immediately respond to requests for comment.

New Energy Minister Jeff Radebe was set to sign the 27 independent renewable energy contracts, including power purchase agreements, in Centurion on Tuesday morning.

"We have reached this milestone following a long period of uncertainty but with this [upcoming] signing we are reconfirming government's commitment not only to renewable energy, but also to a solid partnership with the private sector as we pursue our energy transition objectives in the future," he said in a recent speech.

The matter will be heard in the North Gauteng High Court on March 27.

Source: Fin24

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