Karpowership SA has applied to the department of forestry, fisheries & the environment to re-enact the environmental authorisation it got for its floating gas-to-power plant in Richards Bay.
Environmental affairs minister Barbara Creecy granted the majority Turkish owned company the required authorisation for the project in October. However the authorisation was appealed by environmental lobby groups, the Biodiversity Law Centre, and the South Durban Community Environmental Alliance and groundWork, which were represented by the Centre for Environmental Rights.
This appeal effectively cancelled the authorisation. Karpowership SA wants Creecy’s authorisation to remain in effect during the appeal process.
One key reasons it gave in its application to have the suspension of the environmental authorisation lifted is that it needs to reach commercial and financial close by December 31 — and cannot do so if it remains suspended.
Karpowership SA, which was awarded three bids to provide 1,220MW for 20 years via power ships moored in Coega, Richards Bay and Saldanha in the Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP) in March 2021, is under pressure to reach the commercial close before the end of the year.
Ministers of public enterprises and energy Pravin Gordhan and Gwede Mantashe are on record saying that Karpowership SA and other successful bidders under the government-backed RMIPPPP, that have not yet started construction on their projects, have until end-December 2023 to reach commercial close or risk losing grid access that was granted previously.
The environmental affairs department told Business Day that Creecy was considering Karpowership’s request as well as the appeals. Department spokesperson Peter Mbelengwa declined to comment further on the appeals saying doing so would pre-empt the process.
Michelle Koyama, an attorney with the Centre for Environmental Rights, said while the appeals process is under way Karpowership SA cannot rely on its environmental authorisation [because it] has been suspended “since November 22 when the appeals were submitted.”
“This self-created urgency by Karpowership SA therefore, should not deprive interested and affected parties of due process, and give way to Karpowership SA’s attempt to bypass the fundamental safeguards intended in law,” Koyama said.
Section 43(7) of the National Environmental Management Act automatically suspends the environmental authorisation, she said.
“This provision in National Environmental Management Act exists to ensure that the environment is still protected while the appeal is being heard. Karpowership however has applied to cancel this automatic suspension of the environmental authorisation,” she said.
This application by Karpowership SA is provided for under section 43(9) of the act.
In a pre-application summary submitted to the department of environmental affairs on November 15 — about a week before the deadline for appeals — Karpowership SA said with the deadline for commercial close set for December 31 and “project document signature [that was] due to take place on December 22”, the company could lose its preferred bidder status. “That is there will be no further project”.
However, according to the environmental lawyers who submitted the appeals, the department will only decide on whether to allow Karpowership SA’s application for the suspension to be lifted in January. This means that the environmental authorisation remains suspended in the interim, which could mean that the project fails to reach commercial close by December 31.
“Even if Karpowership SA is successful in this application, it still does not do away with the appeals,” said Kate Handley, executive director of the Biodiversity Law Centre.
“The department of forestry, fisheries & the environment initially gave us until December 8 to submit comment on the application. We wrote to the department that this was too short a time ... because this is a novel provision that has not been used before and it will take time for us to pull together a factual argument for why this application should not be successful. The department then came back and gave us until January 8 next year to submit a responding statement to the application,” Handley said.
This was a case of “self-created urgency by Karpowership SA”, Koyama said.
“Due to the incomplete and inadequate nature of the reports provided, lack of adequate public participation, and noncompliance of department of forestry, fisheries & the environment’s numerous directives are some of the factors that have resulted in the environmental authorisation being refused the first time and the environment impact assessment process having to be undertaken twice, causing unnecessary delays.”
Liziwe McDaid of the Green Connection, who together with organisation Oceans Not Oil, support the appeal brought by the Centre for Environmental Rights said they were also preparing to lodge an appeal against the environmental authorisation that was granted in late November for Karpowership SA’s project in Saldanha Bay. Once lodged, as has been the case in Richards Bay, this appeal would then automatically suspend environmental authorisation for the Saldanha Bay project as well.
Karpowership SA did not respond to requests for comment at the time of publication.
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