Government completes renegotiation and restructuring exercise of PPAs with 6 IPPs

South Africa is enduring acute energy shortages

Audio By Carbonatix

Government has substantially completed a renegotiation and restructuring exercise of Power Purchase Agreements (“PPAs”) with 6 operational Independent Power Producers (“IPPs”), namely, Karpower, Cenpower, Early Power, Twin City Energy (formerly Amandi), AKSA Energy and CENIT Energy, Finance Minister, Kek Ofori-Atta stated in the 2023 Budget and Economic Policy.

This is part of efforts to ensure power is affordable for industrial, commercial and residential use.

Also, government has pursued cost-cutting and green initiatives, including conversion to a tolling model, refinancing of expensive debt, profiling of tariffs and switching power plants from imported liquid fuel to locally produced natural gas as primary fuel.

On connectivity to the national grid, a total of 157 communities were linked to the national grid as of September 2022.

To this end, the Ministry of Energy will further connect an additional 400 towns under the SHEP-4, SHEP-5 and Turnkey Projects in 2023.

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