Pretoria - The City of Tshwane has taken Eskom to task over the power utility’s bid to take over the electricity supply of the multimillion-rand Mooikloof Mega City Project.
At the centre of the battle is the plan by Eskom to add the flagship project to its distribution area.
The City announced its intention to challenge Eskom following public hearings held by the National Energy Regulator of South Africa (Nersa) to hear the power monopoly’s application to amend its electricity distribution licence to include the mega project east of Tshwane.
The project, expected to generate R1.5 billion in electricity sales, was launched by President Cyril Ramaphosa in October 2020 as one of the government’s 62 strategic infrastructure projects to be managed by the Presidency.
City of Tshwane spokesperson Selby Bokaba indicated that the metro had informed the utility that it had no intention of assigning its duties and obligations regarding the supply of electricity for the Mooikloof Mega City Development to Eskom.
If anything, Bokaba indicated that the City reserved the right to the first option of supply for the project and any future developments across the city.
According to him, the Mooikloof Mega City Development was planned to be developed on a portion of the farm identified as Rietfontein, which, according to Schedule 1 of the latest available electricity distribution licence, fell under the supply area of the City of Tshwane.
Tshwane falls under a Category A municipality, and Bokaba said constitutional and municipal legislation meant that the City was afforded executive authority over all local government matters listed and, in particular, for the reticulation of electricity which fell under its authority.
Furthermore, the City had existing infrastructure near the Mooikloof development, and future plans to develop the Zwavelpoort substation, and this would further support the megacity development and neighbouring developments.
“Where the City of Tshwane is not able to provide electricity to customers within its licensed supply area for various reasons, the City shall grant written permission, upon request, for the customer to approach any other capable distributor, including Eskom.
“However, it is required that the City obtain prior written approval from Nersa before assigning any of its duties and functions to Eskom or any other entity.
“It is with this same courtesy that the City would have expected Nersa to inform the City when the application to amend the distribution licence was initially lodged by Eskom back in March 2021, especially considering the impact on the existing licence.”
Bokaba added that, as per the Electricity Regulation Act, permission had to be sought from the licensee when there was an amendment to the licence. It was for this reason that the City had requested Nersa to supply reasons why the licence to supply this (the farm) portion had been revoked from it.
“The largest source of income for the municipality is through self-generated revenue, and in this case electricity generates the most revenue of all other utility services. The distribution of electricity, by Eskom, within a municipality’s jurisdiction leads to a loss of revenue or opportunity to generate revenue from the distribution of electricity for a municipality,” he said.
The South African Local Government Association reportedly supported the City’s objection to the amendment at the public hearings.
The association, Nersa and Eskom had not responded on the matter by late yesterday.
Pretoria News