Environmental Minister Barbara Creecy has decided to appoint an independent expert to help her decide on the environmental approval for operating power ships along South Africa’s shoreline.
The Department of Forestry, Fisheries, and the Environment has opened a tender for a 12-month contract to advise the minister on appeals lodged in terms of the National Environmental Management Act of 1998 (NEMA) or any Specific Environmental Management Act (SEMA).
“In light of the nature and technical complexity of appeals lodged in NEMA or SEMA, the service of an independent expert is required, with relevant expertise and proven extensive experience in environmental matters, to consider and assess all the information pertaining to the appeal and make recommendations on the appeal for Minister’s consideration and decision-making purposes,” the tender’s terms of reference explain.
A spokesperson for the department told Network24 that among the expert’s responsibilities would be — within ten days of their appointment — to consider an appeal by Karpowership.
Karpowership was set to moor five of its power-generating ships and three support ships near the harbors of Richards Bay, Saldanha Bay, and Ncqura to provide 1,220MW of 2,000MW in the Risk Mitigation IPP Procurement Program (RMIPP).
Initially, this program’s full complement of capacity was supposed to come online by the end of 2022 to help Eskom curb generation shortages and reduce the frequency of load-shedding in the short term.
The power ships operated by Karpowership generate electricity using Liquified Natural Gas (LNG). The electricity is then carried via transmission cables to the land to connect to the grid.
However, environmental activists warned that these ships would produce damaging air and sound pollution, to the detriment of bird and fish life within their vicinity.
Karpowership’s initial emergency approval was respinded after the environmental department found it was inappropriately granted under the auspices of being necessary to fight the Covid-19 pandemic.
the environmental department’s Green Scorpions has recommended that criminal charges be laid against the company for misleading the department in this regard.
To legally operate in South Africa, Karpowership would be required to complete a full Environmental Impact Assessment (EIA) to get clearance from the department.
Despite mounting pressure from energy minister Gwede Mantashe in getting the deal pushed through, Creecy has seemingly remained steadfast in refusing approval without an EIA.
Without environmental approval, Mantashe has had to repeatedly grant Karpowership an extension on the project’s financial close.
Most recently, he said only the REIMPP projects that would reach financial close by a final, “unnegotiable” deadline of 31 March 2022 will be added to the grid.
Based on comments from President Cyril Ramaphosa during his 2022 state of the nation address, these will only be the 800MW of remaining projects that form part of the procurement.
Aside from the environmental concerns, the potential deal has been riddled with accusations of corruption and became the subject of a court challenge by DNG Energy.
While this challenge has been dismissed, Karpowership still has another obstacle to overcome in its bid to sell power to South Africa — Eskom.
Minister Mantashe has accused Eskom of stalling on signing the 20-year power purchasing agreement with Karpowership, but the utility has remained adamant that it would not get into “onerous” contracts that would jeopardise its financial position.
Eskom wants the national energy regulator, Nersa, to provide clarity on the calculations that will be used to determine the costs of the LNG required to run the power ships’ turbines.
The utility’s concerns make a lot of sense considering the costly coal contracts that have hurt its finances in the past, as well as how much it has had to spend on diesel for emergency generation.
UCT professor Anton Eberhard so told News24 that signing 20-year contracts for power ships was not standard practice.
“No-one has ever signed a 20-year contract for power ships. They offer a short-term emergency power option when there are no alternatives,” he said.
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