Coal truckers lose their bid to block Eskom's deals with IPPs

26 March 2019 - 12:00 By TimesLIVE
The application brought by the Coal Transporters' Forum to prevent Eskom from signing power purchase agreements with IPPs has been dismissed. The IPPs, Eskom, the energy minister and Nersa all opposed the application.
The application brought by the Coal Transporters' Forum to prevent Eskom from signing power purchase agreements with IPPs has been dismissed. The IPPs, Eskom, the energy minister and Nersa all opposed the application.
Image: John Liebenberg

An attempt to halt Eskom's deals with independent power producers (IPPs) has failed.

In a case brought by the Coal Transporters' Forum, the high court in Pretoria was asked to prevent the parastatal from signing power purchase agreements with a number of IPPs pending the National Energy Regulator of SA's (Nersa's) decision on granting generation licences to the IPPs.

The IPPs themselves, Eskom, the energy minister and Nersa all opposed the application.

On Tuesday, the matter was dismissed with costs.

Energy minister Jeff Radebe had intended to sign the power purchase agreements with 27 IPPs in 2018.

The forum represents coal truck owners contracted to Eskom. In its affidavit‚ the forum cited higher costs from IPPs. It said Eskom was procuring a kilowatt hour of electricity from the IPPs at 214c for what they could produce at 32c by using abundant and cheap coal. 

"The kilowatt hour that is procured at 214c is sold for 86c by Eskom to the consumer. This has cost the economy R9bn a year until 2021."

Mninawe Xaluva‚ a corporate legal specialist employed by Eskom‚ said in an answering affidavit that the IPP Renewable Programme was conceived as a means to add additional capacity from various energy sources to promote the country's obligations to decarbonise the economy and ensure security of supply.


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