GRAAFF-REINET NEWS - The Alternative Load Reduction Programme that the Dr Beyers Naudé Local Municipality (DBNLM) had embarked on since February 2023, was officially launched on Monday 23 September.
It was a proud moment when national Deputy Minister of Electricity and Energy Samantha Graham-Maré, Sarah Baartman District Mayor Deon de Vos, DBNLM Mayor Willem Safers, Municipal Manager Dr Edward Rankwana, public stakeholders and council members officially introduced the municipal owned and distributed rooftop Small Scale Embedded Generation (SSEG) programme.
Graham-Maré praised the municipality for taking the lead to overcome the electricity shortage.
"Dr Beyers Naude Local Municipality has had the foresight and courage to adopt an innovative approach to their electricity business. This has required a commitment to change, a willingness to innovate and a determination to stay the course, no matter the obstacles. They have shown what is possible in your step outside the limitations of what has always been done. I am so proud that my municipality is leading the way in this ground-breaking initiative," said Graham-Maré.
Christo Nicholls, CEO of Utility Consulting Solutions, the business partner of the DBNLM in this venture, explained the technical side of the programme.
A typical installation comprises a PV system, back up battery system and a bidirectional electricity meter, enabling the feeding of excess solar energy back into the grid with fiscal benefits for the client. Nicholls said businesses and households with adequate space on the roof can now partner with the municipality and without spending one cent of their own, join the evolution of smart electricity trading, whereby they can start receiving daily discounts on their electricity usage. The installation at Pick n Pay in Graaff-Reinet marks the first ever municipal initiated and supplied SSEG deployment for a client of a municipality in South Africa.
"This is history in the making as we hereby directly address electricity affordability and availability in a sustainable and pragmatic fashion," said Nicholls.
A small group of local municipalities countrywide has embraced the programme designed to address the need for affordable municipal supplied electricity that is available - even during national load shedding.
Liz Buisman of the Graaff-Reinet Rate Payers Association (GRRPA) felt fortunate to hear the Deputy Minister of Energy's address. "We agree that the focus should be on green energy and the pro-poor policy. Residents are struggling to afford electricity so a plan to reduce costs by recycling solar electricity produced by Montego and Pick n Pay into the grid is welcome. Other residents and businesses are encouraged to do the same. An education programme showing how this can be done, needs to be available," she said.
Garth Hitge, treasurer of GRRPA, a retired official in DBNLM's finance department, said the new direction in the cost of electricity provision is a fantastic initiative. "It is good that our municipality made a public announcement about it. I found it difficult to understand the workings of the system as Mr Nicholls went through the explanation of the process very fast. I hope that our municipality will be able to improve service delivery in other fields too."
Christo Nicholls, CEO of Utility Consulting Solutions explaining the way forward.
Deputy minister of Electricity and Energy Samantha Graham-Maré.
Sarah Baartman District Mayor Deon de Vos expressing his satisfaction with the DBNLM's venture.
To the Mayor, Councillor Willem Safers, Speaker, Cllr Cheslin Felix
Executive Mayor of Sarah Baartman District Municipality, Cllr Deon De Vos
Councillors of Dr Beyers Naude, Dr Rankwana, Municipal Manager Mr Jimmy Joubert, CFO
Mr Benny Arends, Director Engineering and Planning
Ms Zoleka Kali – Director Corporate Services
Ms Edwardine Abader, Acting Director Community Services
Mr Hans Hendricks, COO The Economic Development Forum
The Graaff-Reinet Residents and Rateypayers Association
Mr Christo Nicholls and the Team from Utility Consulting Solutions
Members of the Media
Ladies and Gentlemen,
Good morning
With almost 180 days of being loadshedding-free, it is easy to believe that we are no longer in the midst of an energy crisis. But load shedding was merely a symptom of the greater issues that we face in energy. One of these is municipal debt.
As many of you are aware, municipal debt remains one of the biggest threats to the financial sustainability of Eskom. By March 2024, municipalities owed Eskom in excess of R 74.4 billion rand with the arrears in the previous financial year being approximately R15.9 billion.
The impact of this is two-fold. Eskom’s ability to manage its own operations and provide affordable, stable electricity to its customers is being increasingly compromised. And Municipalities are drowning in debt and failing to meet even their most basic Eskom commitments. The recent attachment of the bank accounts of Emfuleni Municipality by Eskom highlights the growing impatience of the utility to recover outstanding debt.
Dr Beyers Naude Local Municipality has been no exception. In 2016, when the Municipality was amalgamated, Dr Beyers Naude inherited a large Eskom debt (amongst other historical debt) and a small revenue base. Unable to meet its financial obligations, Eskom debt, in particular burgeoned.
When Eskom rolled out the Debt Relief programme, Dr Beyers Naude were initially hesitant to sign up due to the stringent conditions of the programme and their concern about defaulting.
Between meeting the conditions of the Debt Relief programme and complying with their constitutional mandate to provide sustainable service delivery, including affordable electricity, local attorney, Derek Light facilitated a partnership between the Dr Beyers Naude Municipality and Utility Consulting Solutions (UtCS), a leading entity in the domain of pragmatic, sustainable municipal service delivery, framework development and institutionalisation.
UtCS developed a bespoke framework for the municipality which activated an innovative and first-in-SA municipal supplied green energy solution which directly assists municipal clients to qualify for various tiers of daily discounted electricity. In other words, through the innovative amalgamation of the latest green energy technology, existing legislation and cutting-edge institutionalisation methodologies, consumers in the Dr Beyers Naude local municipality can now enjoy a yearly CPI based cost increase as opposed to the logarithmic increases imposed on municipalities by Eskom. And this reality exists without consumers having to spend one single cent on any technology or associated maintenance fees.
Not only has this solution seen a partnership with UtCS and the Municipality, but it has created a partnership between the Municipality and businesses and residents where the latter have become producers of electricity through their own green technology installations.
And as a result of this multi-faceted partnership approach, by December this year, Dr Beyers Naude Local Municipality will break even on its bulk electricity account.
What this means is that there are solutions to address the Eskom debt crisis facing so many Municipalities across South Africa. And that by finding the correct, bespoke solution for local municipalities, we can ensure that municipalities are able to deliver on their mandate for electricity distribution in a financially sustainable way which can directly contribute to economic growth and job creation.
The new Electricity Regulation Act, when implemented, will place South Africa on the brink of an energy revolution with increased availability of electricity from IPPs that will be able to supply directly to municipalities. In the meantime, however, the solution proposed through the Dr Beyers Naude model allows for small-scale embedded generation from renewable technologies to resolve the immediate local needs for both energy and financial sustainability.
We need solutions like this to be adopted and applied in other municipalities so that we can support them in resolving their Eskom debt crises and to meet their electricity current account obligations. By relieving Municipalities of their crippling debt, we can allow them to focus on frontline service delivery and to create an enabling environment for businesses to thrive. And where businesses thrive, so does job creation.
I would like to take this opportunity to express my congratulations and my gratitude to the Mayor, the CFO, Council and officials of Dr Beyers Naude local municipality for having the foresight and courage to adopt an innovative approach to their electricity business. This achievement required a commitment to change, a willingness to innovate and a determination to stay the course. You have shown us all what is possible if you step outside of the limitations of what has always been done.
It is an absolute honour for me to be able to share your achievements with the country, as not only the Deputy Minister of Energy and Electricity but also as a resident of Graaff-Reinet and Dr Beyers Naude Local Municipality. I am so proud that my Municipality is leading the way in this innovation.
In my capacity as Deputy Minister, I am extremely excited about what this project can unlock for South Africa as we seek to find solutions to the protection and enhancement of municipal revenue while keeping electricity available, accessible and affordable for our citizens.
We look forward to partnering with Dr Beyers Naude, COGTA and SALGA and other role players and rolling out similar bespoke programmes to other municipalities across the country over the coming months.
Dr Beyers Naude, in partnership with UtCS, has shown us what is possible. It is now up to the rest of us to make it happen.
Thank you.
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