NERSA approves Eskom's transfer application for NTCSA powers

The NTCSA has also been designated as a buyer in the electricity space.

The National Energy Regulator of South Africa (NERSA) has approved Eskom’s application for a transfer of its powers and duties related to section 34 Power Purchase Agreements (PPAs) with Independent Power Producers (IPPs) to the National Transmission Company South Africa (NTCSA).

The NTCSA is the transmission arm of Eskom and the move represents a step forward in the power utility’s unbundling process.

“Eskom’s application to NERSA on 21 December 2023 for consent to transfer its powers and duties under section 34 of the Electricity Regulation Act to the NTCSA was a pivotal step in its unbundling process, as outlined in the 'Roadmap for Eskom in a reformed electricity supply industry' published by the Department of Public Enterprises in 2019.

“The transition of the Buyer role for section 34 IPPs from Eskom to the NTCSA is a critical component of this process,” NERSA said in a statement.

The NTCSA has also been designated as a buyer in the electricity space.

“In addition to this landmark decision, the Energy Regulator further sanctioned the issuance of a cost recovery letter to the NTCSA for section 34 IPP projects, and the amendment of the IPP’s generation licences to designate the NTCSA as the buyer in terms of section 16(1)(d) of the Electricity Regulation Act, replacing Eskom Holdings in this role. The NTCSA’s trading licence will be amended accordingly,” NERSA said.

Meanwhile, NERSA has announced that it has made a “significant decision regarding the processing of high-profile decisions by its subcommittees particularly the Electricity Subcommittee and the Petroleum Pipelines Subcommittee”.

“The Energy Regulator resolved that all subcommittees will no longer withhold the exact number or decision, for example, the total percentage of allowed tariff/revenue being recommended to the Energy Regulator for approval in high-profile matters.

“This decision of the Energy Regulator is in keeping with section 8(9) of the National Energy Regulator Act, which mandates that all Energy Regulator meetings must be open to the public, with the exception being when discussing information that would require the Energy Regulator to refuse access under the Promotion of Access to Information Act,” the regulator said.

NERSA explained that before this decision, certain information would be withheld from the public until a final decision had been reached and communicated with affected parties.

“This decision is a step towards greater transparency and accountability in Energy Regulator proceedings, particularly in cases involving applications from entities such as Eskom and Transnet.

“Moving forward, unless a resolution is passed to withhold information due to legal constraints, all subcommittees will fully disclose the intended recommendations to the Energy Regulator,” NERSA said. 

(With Inputs from South African Government Press Release)