Amid public power utility Eskom's ongoing woes, Energy Minister Jeff Radebe this week gave the National Energy Regulator of SA (Nersa) permission to go ahead and licence applications from various sectors for projects to generate their own electricity.
The energy department has confirmed that Nersa can now license 500 megawatts for small-scale embedded generation (SSEG) projects.
Independent energy expert Ted Blom describes this as fantastic news but cautions that the minister may have over-reached in this instance.
There might be a bit of over-reach by the minister into the regulator's domain, because they are actually busy with this... As long as it doesn't compromise their independence it's most, most welcome.— Ted Blom, Independent energy expert
Blom says he anticipates a 'massive explosion' in the electricity market off the back of this news.
On the lower end it opens up the market for self-generation and perhaps even community generation by townhouses, stokvels and the like.— Ted Blom, Independent energy expert
Hopefully the regulator will be fair and say that you'll get the same tariff as what Eskom charges you when you draw off the grid, you get the same when you pump into the grid. But that's highly unlikely.— Ted Blom, Independent energy expert
For more on the implications of this move, take a listen:
This article first appeared on 702 : Opening up electricity generation: 'Expect an explosion in the market'