President Electricity Regulation Amendment Bill, which President Cyril Ramaphosa signed into law at the weekend, sets out reforms of the country’s electricity sector, including the establishment of a competitive electricity market.
The bill amends the Electricity Regulation Act of 2006 to “open up pathways to greater competition and reduced energy costs; increase investment in new generation capacity to achieve energy security establish an independent transmission company as the custodian of the national grid; and impose severe penalties for damage to and sabotage of infrastructure”.
The act provides for the establishment, duties, powers, and functions of the Transmission System Operator SOC Ltd (TSO) – which must be established as an independent entity within five years and for the National Transmission Company of South Africa to act as the TSO in the interim.
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It also provides for an open market platform that allows for competitive, wholesale or retail buying and selling of electricity. The Presidency said: “The act provides for market operation as a new activity that may be licensed by the National Energy Regulator of South Africa (Nersa).
In addition, it requires the development of a Market Code that will establish rules to govern the future competitive market, and outlines the process through which the code will be approved. The act further clarifies the principles that apply to the setting or approval of prices, charges and tariffs.”
Meanwhile, those found damaging, removing or destroying any transmission, distribution or reticulation cable, equipment or infrastructure could face fines of up to R1 million, five years in prison or both.
“Penalties for persons who unlawfully receive such cables, equipment or infrastructure face fines of up to R5 million or 10 years in prison or both,” Cyril Ramaphosa said