FIFI PETERS: I’m not too positive what stage of load shedding we’re on proper now, whether or not we’re being load shed at this current second. Stage 3? Okay. Apparently we’re on Stage 3. I don’t know what occurs at City Power, however I think about that there are various sad residents in Johannesburg who’ve to deal with the facility cuts that are very inconvenient – not just for households, but in addition for enterprise.
So, in a bid to scale back its dependence on Eskom and its vulnerability to load shedding, the City of Johannesburg has put out a request for proposals to IPPs, unbiased energy producers, to probably provide it with various vitality. Currently town is getting round 90% of its energy from Eskom, which means that when Eskom’s lights go down, so do the remainder of the lights within the City of Johannesburg.
We have the MMC for Environment and Infrastructure Services on the City of Johannesburg, MMC Michael Sun, on the Market Update for extra. Sir, thanks a lot on your time. It is sweet to converse with you once more. This was coming and I believe the latest adjustments to rules – which at the moment are permitting native governments and authorities entities to secure their very own energy – are serving to. But simply give us the element of the RFP [request for proposals], sir, how a lot renewable vitality you’re wanting to get on the market, what sort of vitality combine you’re wanting to create.
MICHAEL SUN: Thank you very a lot, Fifi. Great speaking to you once more. Currently in Johannesburg we’re searching for about 500 megawatts [MW] so as to bridge that hole of load shedding, and the calls for by our prospects.
Just to take your listeners again a bit of bit, in April this yr we held the primary ever Energy Indaba in Johannesburg. We spoke to the business, [indistinct], lecturers, function gamers, and this course of then culminated as we speak from City Power in a request proposal. This request has been issued asking these accessible and prepared suppliers within the type of unbiased energy producers to come and interact with the City and say they’re in a position to provide us with capacities.
And by the best way the date is January 31, 2023 – we’re then hoping that now we have this huge variety of proposals and we’ll then be taking them to the Department of Mineral [Resources] and Energy and say: “We’ve got so much in proposals; please give us the go-ahead.”
Then we will likely be getting into into energy buying agreements with these IPPs, and begin to feed that capability into the grid in order that we will breach the hole of load shedding.
For instance, we’re at the moment in Stage 3. We are hoping that with all this further capability we’ll then find a way to transfer our residents two ranges down to Stage 1. So actually the affect could be that the consquences felt because of load shedding could be a factor of the previous for the residents and the purchasers of Johannesburg.
FIFI PETERS: Music to our ears. Can I simply ask, do you could have your window down – and will you simply shut it for us?
MICHAEL SUN: My apologies. I don’t have my window down. It’s very noisy within the place the place I’m.
FIFI PETERS: Oh, okay. We need to guarantee that we catch each element of what you’re sharing with us proper now. So 500MW you mentioned, and I think about that’s a mixture of photo voltaic and wind. What is the final word imaginative and prescient? Right now 90% of your energy comes from Eskom. What would you want to deliver this down to, and over what time interval?
MICHAEL SUN: We consider that load shedding is right here to say, judging and listening to what Eskom has been saying to us, and what’s been introduced.
We should not completely optimistic that within the brief area the nation will likely be in a position to get away from load shedding.
What we actually need to do – 500MW is the demand we’re . So with the rising inhabitants within the City of Johannesburg we actually need to be sure that we get as a lot capability – the truth is, a lot of that we wish to guarantee is inexperienced and renewable vitality.
If you’re able to produce electricity from your photo voltaic panels, we are saying come and speak to us.
We need that electricity, and we additionally need to get a very reasonable response from the market in order that we get finest worth for cash, as a result of these advantages will in the end move on to our residents, so we’re in a position to get monetary savings of their pockets.
But then once more that is one thing that we’ve been planning for months. We actually needed to guarantee that it is a course of and train the place we tick all of the containers when it comes to laws, regulation and course of.
But it’s step one. It could appear a really small first step, however actually it’s a optimistic step in the correct path.
We actually need to then share this expertise and our learnings and our assets with our neighbouring municipalities – Tshwane, Ekurhuleni, Mogale City – and say that’s the province of Gauteng [that] was then in a position to discover these further various blended sources of vitality, in order that ultimately we as a province are in a position to keep away from this load shedding impact.
Unfortunately not a complete disconnect from Eskom, as a result of Eskom is the most important energy provider of the nation. But we actually need to breach that hole the place Eskom ought to permit the load shedding, we’re saying to our residents that you just’ll be spared.
FIFI PETERS: Do you could have a funds in thoughts, an concept of how a lot your personal vitality transition as town will value you?
MICHAEL SUN: Fifi, for the time being this entire programme of IPPs would then be funded from our normal bulk purchases.
In different phrases, no matter monies we spend to purchase electricity from Eskom, we’ll use a part of that to purchase from IPPs. But there will likely be a course of the place now we have a Just Transition when it comes to the traditional energy provide.
For instance, now we have one other IPP within the type of Kelvin [Power Station, in Kempton Park] that the customers can name to generate the electricity. We actually are wanting on the accessible funding.
It’s very attention-grabbing what the worldwide world has on provide. I’m actually watching COP27 very intently and searching on the assets accessible for these [in terms of the] Just Transition, the place we’re in a position then to once more switch these advantages and assets to our residents and to our job markets the place it’s most wanted, to be sure that now we have one of the best of each worlds, the place we’re in a position to have an uninterrupted provide of electricity on the one hand, after which our residents, particularly the younger folks, are in a position to combine themselves into that new vitality area.
So it’s actually thrilling for us. We are optimistic and we stay dedicated as a multiparty authorities. Our govt mayor Dr Mpho Phalatse has actually performed quite a lot of work in main us to the place we at the moment are.
FIFI PETERS: Certainly she has. Lastly, how is that this in the end going to have an effect on our electricity invoice as residents of the City of Johannesburg, this route to procure extra energy from unbiased energy producers? And will it make it cheaper? Is it going to be the identical, or may we be paying extra, probably?
MICHAEL SUN: That’s a really attention-grabbing query. In phrases of City Power, we additionally want to generate income, however it isn’t our monetary goal to break our residents and prospects’ pockets.
So within the brief time period we’re in all probability not going to see quite a lot of pricing distinction, as a result of these pricings are regulated by Nersa.
We do have to strategy Nersa on the pricing that we pay to the IPPs.
So within the brief run there received’t be quite a lot of financial savings, however in the long run the place we publish the second RFP, that’s the place we’re a lot larger, larger-scale suppliers, then we’re in a position to negotiate for higher costs, and positively these financial savings that we see there we’ll move on to our residents.
That’s the place you’re going to see financial savings within the pockets of our residents..
FIFI PETERS: All proper. MMC, sir, thanks a lot on your time with us. An important story. Michael Sun is the MMC for Environment and Infrastructure Services on the City of Johannesburg.