South Africa Opens Up the Energy Supply Field

South Africa’s government will allow private investors to build their own power plants with up to 100 megawatts of generating capacity without requiring a license, in a bid to address the nation’s failing electricity supply. The move to raise the limit from 1 megawatt is part of a wider strategy to ease energy shortages that have hobbled Africa’s most-industrialized economy since 2005. The country regularly experiences rolling blackouts, with state utility Eskom Holdings SOC Ltd. unable to generate sufficient electricity from its old and poorly maintained plants to meet demand. “There is no doubt that the prospect of a continued energy shortfall and further load-shedding presents a massive risk to our economy,” President Cyril Ramaphosa said Thursday in an online briefing. “This intervention reflects our determination to take the necessary action to achieve energy security.” The projects will still require permits to connect to the grid, but they will be much quicker to obtain than licenses, according to the president. Companies producing excess power will be able to sell it through the transmission network, subject to agreements with Eskom and municipal authorities, he said.

SOURCE: BLOOMBERG