Union court action blocks South Africa renewable PPA signing


Numsa claims the move from coal-fired power to independent renewable energy projects will see large-scale job losses, as well as result in higher power prices. The government, which on March 8 announced its intent to sign 27 outstanding deals, has taken steps to prioritize partnerships with the private sector just weeks after President Cyril Ramaphosa took office and made his own appointments, including Energy Minister Jeff Radabe, to the Cabinet.

"In a nutshell, these projects will provide 61 600 full-time jobs, of which 95% is for South African citizens, mostly during plant construction specifically with a focus on youth employment". There was also misunderstanding about the process of Monday's court application.

Numsa said the signing of these contracts "would be detrimental for the working class of Mpumalanga and the country as a whole".

In terms of the interdict, Radebe now has to hold off on signing the IPP agreements until the court hearing on March 27.

Radebe's comments follow a decision by the National Union of Metal Workers of South Africa (NUMSA) and non-governmental organisation Transform RSA's decision to approach the High Court in Pretoria.

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"The IPP roll-out will raise the cost of electricity dramatically, because IPP's cost much more than coal-fired electricity", Numsa said.

The signing, he says, is government's recognition that wind and solar are the cheapest forms of electricity, and implementing these on a national scale will help to reverse Eskom's drastic upward cost trend and drive power prices down. Extracting fossil fuels from underground is a "resource play".

At a media briefing announcing the signing ceremony last week, Radebe said South Africa had reached a milestone following a protracted period of uncertainty. "The reality is that we are living in a country now experiencing 36% unemployment rate and sitting at over 50% poverty rate, such job losses will have a dire effect on economies where these coal stations are located", added Hlubi-Majola.

"The facts are clear: renewables already cost over 50% less than new coal-fired power, government policy has for years included the closure of coal-fired power stations, the associated job losses are being planned for through numerous processes now under way - most notably processes being undertaken by the national planning commission, electricity price increases are directly related to the extended delays and rising costs associated with Eskom's coal build programme".