Pretoria: The Department of Electricity and Energy has released the updated Regulatory Rules on Network Charges for Third-Party Transportation of Energy, commonly referred to as the electricity wheeling framework. This significant update was announced by Minister Kgosientsho Ramokgopa during a media briefing.
According to South African Government News Agency, electricity wheeling involves the delivery of electricity from a generator to a customer located in a different area through existing distribution or transmission networks. The Minister highlighted this development as a pivotal intervention in South Africa’s electricity sector, stating that it aligns with the objectives of the Energy Action Plan initiated by the President in July 2022. The updated framework aims to bolster energy security by diversifying generation sources and reducing reliance on Eskom.
The conditions for third-party participation under the new rules include mandatory licensing and registration with the National Energy Regulator of South Africa (NERSA), completion of power purchase agreements, connection and use-of-system agreements, as well as compliance with grid codes and auditable metering.
The wheeling framework also promotes open access to the electricity network, enabling consumers to choose their power sources. This is expected to foster competition and potentially lower electricity prices. The rules emphasize non-discriminatory access, cost-reflective tariffs, fairness and equity, transparency, network reliability, standardization, regulatory certainty, and support for a just energy transition.
Minister Ramokgopa emphasized the democratization of the electricity space, highlighting the potential benefits of having multiple electricity generators. He suggested that increased competition could lead to greater efficiency, innovation, and investment, ultimately driving down electricity prices and making energy more affordable for all, including vulnerable communities.
The Energy Action Plan, announced by President Cyril Ramaphosa in July 2022 and coordinated by the National Energy Crisis Committee (NECOM), focuses on reducing load shedding and achieving long-term energy security through several key interventions. These include improving Eskom’s supply, accelerating private investment in generation capacity, fast-tracking new generation capacity procurement from renewables, gas, and battery storage, encouraging rooftop solar investments, and fundamentally transforming the electricity sector.