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Exemption Threshold for Embedded Power Plants Under the Spotlight

April 28, 2021

Department of Mineral Resources and Energy

Comment is sought on a proposed increase in the licensing-exemption threshold for embedded power generation plants.

The mineral resources and energy department called for comment on the proposed increase in Government Gazette 44482 in terms of the Electricity Regulation Act.

Currently, embedded generation plants that produce more than 1MW need to apply for a licence.

The plan is to increase the exemption threshold to 10MW.

Plants producing less than 10MW would then have to only register with the National Energy Regulator (NERSA).

Comment is invited within 30 days of the date of publication.

Meanwhile, in Gazette 44469, the department announced the licence fees payable by licensed generators of electricity to NERSA in terms of the Electricity Act.

A licence is needed when a generator of electricity seeks to connect to the Eskom distribution network.

Section 5(b) was the only part of the act not repealed by the Electricity Regulation Act of 2006.

Section 5b focuses on the sources of funds for NERSA.

Licence fees are one of the recognised sources, the others being donations or contributions and interest on investments.

A levy of 0.09281 cents per kWh must be paid to NERSA for the period 1 April 2021 to 31 March 2022.