Home South African Nersa to defend its right to grant Karpowership generating licences

Nersa to defend its right to grant Karpowership generating licences

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The National Energy Regulator of South Africa says it will focus on defending its case for approving energy company Karpowership’s electricity generation licences.

Three Turkish Karpowership projects were given the green light to provide 1,220MW of gas-fired generation capacity over a 20-year period. Picture: Supplied

THE NATIONAL Energy Regulator of South Africa (Nersa) says it will focus on defending its case for approving energy company Karpowership’s electricity generation licences.

This comes after Gauteng High Court Judge Leoni Windell last week dismissed with costs Nersa’s interlocutory application not to disclose confidential information to advocacy group Organisation Undoing Tax Abuse (Outa) with the full, unredacted record of Nersa’s decisions to approve generation licences for Karpowership.

The matter stems from February 2020, when Mineral Resources and Energy Minister Gwede Mantashe made a determination that 2,000MW of emergency generation capacity should be procured, and the three Turkish Karpowership projects were given the green light to provide 1,220MW of gas-fired generation capacity over a 20-year period.

In April 2022, Outa and the organisation Green Connection objected before the courts to the cost, environmental impact and length of the contract, and sought to have Nersa explain the decision to grant power-generating licences to  Karpowership South Africa in Saldanha Bay, as well as its subsidiaries, as part of the Risk Mitigation Independent Power Producer Procurement Programme preferred bidder process.

In the main application, Outa called for Nersa to provide copies of all documents relating to the decisions to grant Karpowership the generation licences, together with the reasons for the decisions.

Both Nersa and Karpowership opposed the application.

However, Karpowership withdrew its opposition, but did not give Nersa the authority to release the confidential documents.

Nersa spokesperson Charles Hlebela yesterday said the energy regulator would abide by the High Court ruling disposing of its interlocutory application.

Hlebela said Nersa had continued to oppose the application to preserve the decision and not violate the Promotion of Access to Information Act, 2000.

“Nersa’s opposition to the interlocutory application should not be misconstrued as being frivolous or obstructive,” Hlebela said.

“Nersa remains committed to transparency and adherence to the Constitution pertaining to access to information and will now focus on the pleadings in the judicial review of its decision to approve Karpowership’s electricity generation licences.”

Outa’s accountability division executive director, advocate Stefanie Fick, said their main application for a review of Nersa’s decisions to grant the Karpowership licences continues.

Fick said Outa believed that by obtaining the full, unredacted record it would be in a better position to evaluate Nersa’s decision-making in awarding the generation licenses to Karpowership.

Fick said Nersa’s counsel presented a settlement agreement minutes before the hearing started, whereby the parties would receive the full, unredacted record, subject to the parties agreeing to a confidentiality regime.

“Outa strongly believes that Nersa’s decision should be reviewed and set aside as it was procedurally unfair, premature and lacking in transparency. Outa, in the main application (the review application), called for Nersa to provide copies of all documents relating to the decisions to grant Karpowership the generation licences, together with the reasons for the decisions,” Fick said.

Although Outa partially accepted the settlement agreement, it was still of the opinion that it should reserve its right to argue at the review hearing or any other application that the provided record – which Nersa and Karpowership believe to be confidential – should be made publicly available.

Nersa agreed to this additional proviso from Outa, and the agreement was made an Order of the Court.

Fick said Outa believed that the costs tendered by Nersa were grossly insufficient and proceeded with a cost argument, asking the court to award a punitive cost order against both Nersa and Karpowership due to their conduct in this matter, which was granted.

Judge Windell ruled that Nersa make all available documents to Outa, including those the entity deemed confidential, and in turn Outa was allowed to disclosed them, subject to confidentiality considerations to parties, including Meridian Economics.

“Nersa, as a public and independent entity, is committed to protecting confidential information submitted by parties unless the confidentiality is challenged successfully,” Hlebela said.

– BUSINESS REPORT

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