Last-Minute Court Interdict Blocks IPP Signing

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The 27th of March 2018 has been set aside for a full hearing of this matter at the North Gauteng High Court.

Cape Town - The Department of Energy has said that no interdict was granted stopping it from signing 27 independent power producer (IPP) contracts with private sector companies on Tuesday.

Today was supposed to be the day South Africa's REIPPPP renewable energy programme got back on track, finalising PPAs for projects that had been left in limbo despite being offered deals as long ago as 2015 under tender rounds 3.5 and 4, after a long-running dispute with state utility Eskom put the entire process on hold.

Although Eskom was not present when the Minister made the announcement, its spokesperson confirmed that a resolution to sign the PPA's were taken at an Eskom Board meeting which was taking place at the time the Minister was making the announcement.

Energy Minister Jeff Radebe was originally due to sign the contracts with independent power producers on Tuesday.

Eskom previously argued that renewable energy is more expensive than the energy it generates from its own coal-fired power stations and tried to impose a cap on the tariffs previously negotiated between the department of Energy and the IPPs.

The NUMSA injunction forced Radebe to agree that the renewable PPAs would not be signed until the issues raised had been subject to a full hearing by the court, according to a statement from the union.

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NUMSA said the signing of these contracts "would be detrimental for the working class of Mpumalanga and the country as a whole".

Numsa's Phakamile Hlubi says this is a great victory.

"'The signing of the IPP means that Eskom will require less coal-fired electricity".

Two unions in South Africa have blocked the signing of renewable energy power purchase agreements claiming that doing so will lead to job losses from closed coal plants. The combination of all these factors will have dire consequences for the working class and the poor.

"Eskom was planning to sign these agreements despite the fact that a previous application‚ by the Coal Transporters Forum to interdict them from signing is still pending at the North Gauteng High Court".

"The court found that our application meets the standard for urgency and therefore granted us the interdict", Numsa said in an emailed statement.

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