City of Cape Town v The National Energy Regulator of South Africa and the Minister of Energy
28 July 2017
The National Energy Regulator of South Africa (NERSA) is of the opinion that a Ministerial determination in terms of section 34 of the ECA is required before it can licence an IPP to establish and generate new capacity. It is therefore refusing to process applications for licences in the absence of Ministerial determinations in terms of section 34 of the ECA.
In this matter, the CoCT is arguing that section 34 of the ECA is merely an empowering provision that allows the Minister to determine the need for new generation capacity and to take the initiative for its procurement – it does not preclude anybody else from establishing and operating new generation capacity as long as they are duly licensed to do so by the NERSA under the ECA.
In addition, the CoCT is of the opinion that section 34 of the ECA is unconstitutional and therefore invalid because it unduly interferes with the CoCT’s right and duty to provide electricty to its inhabitants in such manner as it deems best.
The CoCt has therefore applied to court for an order in the following terms:
- It is declared that a determination in terms of section 34 of the ECA is not required for an IPP to create new capacity for the generation of electricity, to produce electricity by the capacity so created, and to sell the electricity so produced to the CoCT;
- If it is held that such a determination is required, that section 34 of the ECA be declared unconstitutional and invalid;
- If it is held that such a determination is required but section 34 of the ECA is not declared invalid with immediate effect, then the applicant claims an order that the Minister determine the CoCT’s application for such a determination, made on 3 November 2015, within one month of this order.