Cape Town seek to purchase 300MW of gas-fired power

Posted On Thursday, 03 September 2015 12:07 Published by
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Cape Town trade and investment head Lance Greyling says that the metro has made submissions to the Independent Power Producers office, expressing its desire to purchase 300MW of gas-fired power.


City of Cape Town trade and investment head Lance Greyling has disclosed that the metro has made submissions to the Independent Power Producers office, expressing its desire to purchase 300MW of gas-fired power.

This would help fuel the city’s drive to position itself as the number one investment destination, not only in the country but also on the continent.

The city had also set its sights on procuring wind-generated energy, and was engaging with regulatory processes, he said.

This year a PricewaterhouseCoopers (PwC) report ranked Johannesburg as the best city in the country for investment and future growth, while Cairo was the most attractive on the continent as a whole.

Johannesburg came third overall among its African peers. Cape Town did not crack it into the top 10 investment destinations on the continent.

City of Cape Town economic performance indicators for the third quarter of last year show the metro attracted 15 investment projects in the agri-processing and renewable energy industries, among others. Jinko Solar, a Chinese company listed on the New York Stock Exchange, opened an $80million solar photovoltaic manufacturing facility in the city last year. It can produce 120MW a year.

A Wesgro investor survey found that although the majority of investors were confident in Cape Town as an investment destination, more than a third considered national government policies and operations impediments to their operations.

Wesgro is the Western Cape’s trade and investment promotion agency.

Survey respondents identified labour unrest, the education system and visa and work permit problems as investment deterrents.

But Cape Town will tackle one challenge at a time in its quest to become the heir apparent of investment on the continent. In this regard, it has chosen power generation as the first arena in which it will mount its cause.

Mr Greyling said Cape Town was looking at multiple ways in which it could diversify its energy supply instead of being entirely dependent on Eskom. But the regulatory environment is tough for municipalities, particularly metros. 

Mr Greyling said it should be easier for councils to get a good credit rating to enter into contracts with Independent Power Producers.

In terms of the institutional model governing energy, it had become more apparent that a fundamental reform was required for municipalities to play a greater role in contributing solutions to the energy crisis, he said.

“The revenue model for municipalities also needs to change, and we are in the process of trying to reconceptualise the current utility model in the city — which would allow us to take advantage of the major changes that are taking place in the energy field.”

His directorate was following a transversal approach in ensuring that the appropriate infrastructure was put in place to create a competitive business environment.

“Energy is, obviously, top of that list, but it also extends to our broadband roll-out and future spatial planning and transport systems. We have also been involved in a joint project to attract more direct international flights into Cape Town. It has been met with some success already, but we are hoping to see this strategy bear more fruit over the next year.”

Cape Town is looking at multiple ways to diversify its energy supply 

Source: Business Day

Last modified on Thursday, 03 September 2015 12:39

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