Cape Town’s drive to move off Eskom’s grid has received another boost after the International Finance Corporation (IFC), an affiliate of the World Bank, donated close to R6m to assist with the city’s energy transition.
The city said the donation in the form of technical assistance will go towards its sustainable energy projects. The DA-led metro wants to be less reliant on Eskom, the beleaguered power utility that has been struggling to keep the lights on.
Last week, Cape Town mayor Geordin Hill-Lewis announced that the city has opened its first round of procurement of power from independent power producers (IPPs), with tenders to procure 300MW of additional renewable energy issued. Most of the power will be generated by solar photovoltaic (PV) plants, Hill-Lewis said.
On Monday, the city announced that it has entered into an agreement with the IFC and accepted the donation amounting to R5.9m.
The letter of collaboration states that the technical assistance is provided to the city free of charge.
“There will be no co-payment or concomitant additional investment of resources by the city arising out of the transaction, since the city projects on which the assistance will be rendered are scheduled and resourced already. The rendering of the assistance by the IFC will not necessitate the allocation by the city of any additional resources,” said Beverley van Reenen, Cape Town’s mayoral committee member for energy.
“The IFC and its team of consultants have the necessary expertise to render the assistance offered. The assistance will expedite and lend depth to the city’s endeavours in the relevant areas. The work is aligned to city policy and imperatives relating to energy sector reform and climate change mitigation. These are matters which require urgent attention given SA’s energy constraints and the changing energy governance landscape.
“We are committed to doing everything we can, and with all partners, to achieve cleaner, more affordable and secure energy for our residents,” Van Reenen said.
Late last year, the Western Cape provincial government launched a fund amounting to almost R13m to support municipalities in the region to prepare for renewable energy projects. Western Cape finance & economic opportunities MEC David Maynier said at the time the fund was the next critical step in the province’s first phase of the municipal energy resilience initiative, which aims to help municipalities take advantage of the new energy regulations, which could allow them to purchase energy directly from IPPs.
Amended regulations on new generation capacity, which were gazetted by mineral resources & energy minister Gwede Mantashe late in 2020, enable SA municipalities in good standing to develop their own power generation projects. The state has been under pressure to open up the energy sector to allow more players in the market to boost power supply, which is desperately needed to fire up the economy.
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