Ramaphosa eases red tape for independent power providers to generate power

President Cyril Ramaphosa announced that government would amend schedule two of the Electricity Regulation Act to raise the exemption threshold from 1 megawatt to 100 megawatts.

FILE: President Cyril Ramaphosa. Picture: GCIS.

JOHANNESBURG - President Cyril Ramaphosa has announced an amendment to the Electricity Regulation Act that will make it easier for independent power providers to generate power and even sell it back into the grid.

Speaking during a live-streamed briefing a little earlier, Ramaphosa announced that government will amend schedule two of the act to raise the exemption threshold from 1 megawatt to 100 megawatts.

That means power producers will be able to produce power without going through a long drawn-out process with the energy regulator.

"Generators will also be allowed to wheel electricity through the grid subject to wheeling charges and connection agreements with Eskom mand relevant municipalities," Ramaphosa said.

Addressing the media on a day when the nation's labouring under stage three power cuts, the president acknowledged the role uncertain power supply has played in the nation's economic state.

“We are in the midst of the worst economic crisis in our country’s recent history.”

The amendment to schedule two will allow independent power producers to generate up to 100MW of electricity without having to obtain a license from the national energy regulator.

They will also then be able to sell excess power back into the national grid but if they wish to do that, they will still need a permit to ensure they comply with grid requirements.

“This will ensure that we’re able to bring online as much new capacity as possible without compromising the integrity and stability of our energy system.”

The president also confirmed municipalities will be empowered to formulate their own power mix and buy power from independent producers in order to keep the lights on.

Ramaphosa has promised the amendment will be published within 60 days.

Under the new amendment, power producers will still have to go through an official process though.

"Generation projects will still need to obtain permits, a grid connection permit, to ensure that they meet all the requirements for grid compliance. This will ensure that we are able to bring online as much new capacity as possible without compromising the integrity and stability of our energy system," the president said.

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