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Nersa says Eskom is seeking deviation from IRP to build 3 000 MW of combined cycle gas

14th September 2022

By: Terence Creamer

Creamer Media Editor

     

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The National Energy Regulator of South Africa (Nersa) has confirmed that Eskom has not applied for a Ministerial determination for a 3 000 MW combined cycle gas power plant at Richards Bay in terms of the Integrated Resource Plan of 2019 (IRP2019), but is instead seeking permission to deviate from the IRP2019.

On September 12, Nersa circulated an erratum to a consultation paper published for public comment on August 25 in relation to it providing concurrence to a Ministerial determination for the procurement of 3 000 MW of gas-fired electricity.

In its original notice and consultation paper, the regulator said that the 3 000 MW was based on an allocation for gas/diesel generation outlined in Table 5 of the IRP2019.

The table shows the allocation of 1 000 MW of gas/diesel by 2024 and 2 000 MW by 2027, and the original consultation paper stated that the Minister had determined to procure the total capacity of 3 000 MW of gas before 2028.

In the erratum, however, Nersa clarified that the gas determination under consideration for concurrence related to an application submitted by Eskom to Mineral Resources and Energy Minister Gwede Mantashe on January 13 and not Table 5 of the IRP2019.

“The correction seeks to explain that the request for the determination had not originated from the IRP2019 as indicated but from an Eskom application to the Minister in terms of Section 10 (2)(g) of the Electricity Regulation Act (ERA),” Nersa told Engineering News in response to an enquiry, adding that it had mistakenly linked the determination to Table 5 of the IRP2019.

The regulator noted that Section 10(2)(g) of the ERA required every application for a generation licence to include “evidence of compliance with any Integrated Resource Plan applicable at that point in time or provide reasons for any deviation for the approval of the Minister”.

“Eskom had accordingly applied for a deviation from IRP2019 and in accordance with the prescripts of [the] ERA, Eskom is obliged to provide reasons for the need for such a deviation,” Nersa explained.

Following the public comment process, the regulator would conduct its own analysis and “make a decision on whether to concur or not with the Ministerial Section 34 determination based on the legal prescripts and facts and evidence presented or collected by it”. 

Asked by Engineering News whether, given the late correction, Nersa felt the September 16 closing date for comment to be sufficient, the regulator responded: “Yes, since the change only applies to the origin of the capacity while everything else contained in the consultation paper remains the same.”

The original consultation paper had an initial closing date for public comment of September 23, which was subsequently revised to 16:30 on September 16.

The earlier deadline is also applicable to consultation papers related to two other Ministerial determinations for 14 791 MW of ‘Storage’, ‘PV’ and ‘Wind’, for the years 2024 to 2030 and 1 000 MW in accordance with the heading ‘Other Distributed Generation, Co-Gen, Biomass, Landfill’, for the years 2023 and 2024.

The deadline for the renewables determination was shifted earlier to accommodate a doubling of Bid Window Six (BW 6) of the Renewable Energy Independent Power Producer Procurement Programme to 5 200 MW, for which a September 22 bid submission date was set.

However, the National Energy Crisis Committee announced on September 11 that the BW 6 request for proposals (RFP) would be reduced to 4 200 MW, given that the Nersa still needed to concur with a Ministerial determination opening the way for the procurement of more solar photovoltaic (PV) capacity.

“Rather than delay this RFP for all requests to be approved, government opted to issue the current RFP for 4 200 MW as opposed to delaying the entire Bid Window.

“A further announcement regarding the remaining 1 000 MW of solar PV will be made following the conclusion of the Nersa process regarding the concurrence of the new determination,” the committee said in a statement, adding that it still aimed to add 5 200 MW under BW 6 to the grid.

 

Edited by Creamer Media Reporter

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