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- The Electricity Regulation Bill was passed by the National Council of States.
- The next step is for President Cyril Ramaphosa to sign it into law.
- This bill will revolutionize the electricity supply industry and introduce competition.
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The Electricity Regulation Bill was passed by the National Council of Provinces (NCOP) on Thursday, putting SA on an irreversible path to electricity supply reform that will end Eskom's 100-year monopoly.
The bill is one of President Cyril Ramaphosa's most important economic reforms and is critical to effectuating the separation of Eskom and the introduction of competition into the electricity market.
It is a race against time to get this bill passed before Parliament is dissolved ahead of the election. Although the bill was approved by the Cabinet in March last year, due to administrative clumsiness, Parliament only started processing the bill in August.
As a result of last-minute efforts, two of the nine states did not support the bill in the NCOP. The DA-led Western Cape voted against it on the grounds that there was not enough time to engage the public in a meaningful consultation. The Free States did not receive a mandate from the people because their legislatures had already been dissolved for election campaigning.
However, prosecutors supported the bill's passage in the Diet.
This bill would create a state-owned transmission system operator (TSO) that would:
- Operate the national power grid.
- Play the role of a system operator managing supply and demand to balance the power grid.and
- Build an open market platform to enable competitive trading of electricity.
The TSO will be housed within Eskom's unbundled National Transmission Company of SA (NTCSA). Purchase electricity on an equal and independent basis from all power producers, including Eskom's own power plants and independent power producers.
Once the bill is enacted, the price of electricity Eskom sells to consumers will continue to be regulated through tariffs, as is currently the case. However, contracts between willing buyers and willing sellers (for example, municipalities and independent power producers) will be priced competitively.
Cosatu said in a statement that it does not support the bill as it believes it will lead to the privatization of Eskom and price gouging. He also believes Eskom's restructuring will not solve its “multiple crises” of corruption, years of underinvestment and mismanagement, and will further increase costs.
“Workers are concerned that the separation of Eskom portends future privatization and the impact this will have on jobs and electricity bills in working-class communities. We will work together to raise the concerns of workers.''We will work with Government and Parliament on solutions that support Eskom's continued rebuilding as a driver of economic growth and industrial development in South Africa.'' ”
UCT emeritus professor Anton Everhard, who has supported the bill, said on Thursday SA had reached a point of no return.
“Passage of the ERA will begin the electricity system transition process embedded in the 2022 Energy Action Plan…By joining the 110 countries that have already separated transmission and generation, SA will finally be able to It will equip us to achieve security, affordability, and environmental protection” and sustainability. ”