Interested persons, licencees and municipalities have until 16h00 on 31 May 2018 to comment on the National Energy Regulator of South Africa’s draft Rules for Registration of Small-Scale Embedded Generation.
The proposed rules have resulted in some inflammatory headlines and assumptions of doom.
Some of the comments include:
Under new draft rules every solar panel on every house – and backup generators too – will have to be registered with the government from The Business Insider who say:
The draft “rules for registration of small-scale embedded generation” (PDF) leave no room for exceptions. Any form of power generator of any size will have to formally registered, “eg PV/wind/biogas/diesel/fuel cell, generation”.
The rules apply both to off-grid systems, with no connection to the national electricity system, and systems connected to the grid in any way – whether or not they are intended to feed electricity back into the grid.
Failure to register may be unlawful all by itself, but will also preclude the user from being connected to “the distribution system” of electricity, or a municipal grid.
“You need to register no matter what,” says specialist energy law consultant Sue Röhrs of Rohrslaw. “If you are not grid-connected at all, if you are rich and have your own facility up on a hill, if you are connected to the grid, whether you are wheeling through the grid or not,” she says, referring to the process where one a private electricity supplier sends power to a customer using the public grid.
It is simpler to say that the only people who do not need to register are those who only buy electricity from a municipality or directly from Eskom, says Röhrs.
“Even if you have a backup generator connected up, you need to register.”
The rules are open for public comment until the end of May. They are likely to change before they go into force, says Röhrs.
Outa calls on Nersa to withdraw draft rules for generator registration. from OUTA:
“We have received an overwhelming response from the public voicing their concern to these proposed rules. Several thousand signatures have already been received and we are expecting many more,” Outa’s Energy Portfolio Manager Ronald Chauke said in a statement.
“South Africans who have invested in energy saving devices should not be penalised for reducing electricity demand on the national grid nor should they be taxed for becoming environmentally conscious and pursue energy self-sufficiency,” added the portfolio manager.
The organisation has said the draft paper is unacceptable, that due process has not been followed and critical engagement avenues have not been explored.
‘Nersa now punishes consumers who heeded call to use less energy’ – TimesLive, who say:
The rules state that no customer may connect to the distribution system (municipality or Eskom) without submitting an application with Nersa‚ getting a quotation and ensuring that the connection is certified to comply with the required technical standards.
The rules apply to all generators of less than 1 megawatt. Above that level‚ the law requires the same sort of licensing as for a full-blown power station.
“AfriBusiness believes Nersa is attempting to create a database of private electricity producers which could be used to identify individuals who are living off the grid completely or partially‚ which will allow Nersa or municipalities to levy fees for the operation of such systems.
“This is ironic considering the fact that after the major load shedding suffered since 2008‚ certain consumers have heeded Eskom’s call for them to utilise less electricity.
“Now that they have heeded the call‚ there is an attempt to make an income off the dwindling electricity sales as more people and companies are going off-grid. Nersa’s attempt to regulate private electricity production is another example of unnecessary interference by the state to hinder the private sector‚” said AfriBusiness in a statement.
The organisation added that private electricity production is not harming anyone except “those state-owned enterprises and local municipalities that are now bearing the brunt of their efforts to have South Africans use less electricity from local suppliers”.
Draconian Nersa rules to financially hit consumers again – says ESI Africa in their article:
All South Africans, from peaceful pensioner to street vendor barber and large business owners, are under pressure to oppose the new Nersa regulations for small-scale embedded generators (SSEG Rules), states Ted Blom, a partner at Mining & Energy Advisors.
According to Blom, under these rules, which have been in the pipeline for months, is the requirement for all owners/buyers of small-scale “electricity generators” less than 1MW to make an application for the establishment of the installation to their local distributor (municipality or Eskom) and then to register with Nersa.
“I view the rules as draconian,” says Blom, “as they apply to all small installations, whether for private or public use and whether they are to be connected to the grid or not.”
Blom highlights that the definitions and rules are far too wide as they essentially extend right down to micro-solar chargers for cell phones. The definitions are also not clear as they demand registration of all devices, yet only describe the procedure to be followed for grid-linked devices.
According to Blom, the ambit of these regulations is similar to the unworkable and failed Gauteng province e-Toll regulations yet far wider in that they apply to almost all 55 million South Africans in all nine provinces.
“These rules are poorly drafted and unworkable and will result in wide-scale civil disobedience if promulgated,” warns Blom.
Such regulations will result in a permitting system, and eventually, licence fees will be instituted to fund policing of installations. This added cost will give rise to yet another financial burden for ordinary SA citizens, which Blom makes clear “is a regrettable situation which we [Mining & Energry Advisors] will challenge”.
You may have to register your generator – says the Sunday Times in their article:
Eskom or a municipality responsible for distribution also has its own responsibilities‚ which include the following:
- providing to the customer non-discriminatory access to its distribution system‚ except if there are objectively justifiable reasons;
- ensuring that the connection to the distribution complies with the licence conditions of the distributor‚ grid code and national requirements; and
- should the customer want to increase the supply to above 1 megawatts‚ the distributor will redirect the customer to apply to Nersa for a generation licence‚ provided that the distributor agrees with the applicant’s request to
- increase the supply and exemption has been granted by the Department of Energy.
Nersa said the regulations were aimed at meeting the economic objectives of the Electricity Regulation Act of 2006. The proposals are open for public comment until the end of May.
Nersa proposals alarm industry – says Port Elizabeth based Herald Live with these comments:
The new rules apply for people both on and off the grid.
Blackwood Power chief executive Rory Stear said the proposed rules could hamper the industry’s potential to create jobs.
“Every time we have an overreach of bureaucracy, it can’t be helpful to free trade,” Stear said.
“I think renewable energy is such a critical industry in job creation.”
Although bigger companies were likely to handle the registration process on behalf of new clients, Stear said this cost would be included in the price of solar panels, making this a more expensive option for consumers.
“I think Nersa should stick to regulating tariff costs and not trying to cover up what are clearly the inefficiencies of Eskom.
“It’s time to focus on winning [Eskom’s former success] back rather than punishing emerging industries that are part of the solution.” Rubicon sales director Greg Blandford said the draft regulations could hold dire consequences for the industry.
“It would definitely cause civil disobedience. Many people have already invested in renewable energy and for them to register . . . would be similar to the e-tolls in Gauteng.”
He said the proposal would work against the industry’s goal of creating sustainability. Microcare sales and marketing manager Gareth Burley said the industry would definitely take a knock, but that the regulations could also bring benefits.
“There are a lot of fly-by-night [installers] who give the industry a bad name,” Burley said. “A level of regulation could put a stop to that.
“On the other side, it could deter people [from considering renewable energy] as there will be more hoops to jump through.
“[Nersa shouldn’t] punish those who are doing a good job.”
Nersa spokesman Charles Hlebela said the regulator had not decided on what registration would cost, but that those affected would have to enter into a connection agreement with electricity distributors before applying to Nersa. Those who did not comply could be cut off, he said.
“Network service providers will not connect them or, if the smallscale embedded generation will constitute dual connection, the NSP [the service provider] may disconnect its supply.”
South African National Energy Association chairman Brian Statham said the consultation paper was too broad in its intent in that it covered equipment both connected and not connected to the grid.
“This seems to be an overkill and unnecessary in terms of regulating the integrated electricity industry.
“It is not clear how Nersa will benefit from collecting all this information and the real value added,” Statham said.
In reaction to this ‘storm’ of comments NERSA released this statement today:
“Nersa would like to clarify and put into proper perspective the consultation paper on the draft Rules for Registration of Small-Scale Embedded Generation published for written comments on 26 April 2018,” it said.
This as the regulator published the consultation paper with the purpose to invite written comments, views and inputs from stakeholders on the draft Rules.
According to media, the rules have sparked the ire of the public. The regulator’s rules include an application for registration to Nersa and the description of the particular generation technology.
The draft Rules were developed following the gazetted ‘Licensing Exemption and Registration Notice’ by the Minister of Energy on 10 November 2017. Nersa is required to develop the rules in terms of Section 4(ii) of the Electricity Regulation Act (ERA), 2006 (Act No 4 of 2006).
“It is important to indicate that this is not Regulations but a notice to repeal the current Schedule II of the Electricity Regulation Act. The Minister is empowered by section 36(4) of the ERA to amend Schedule II. Nersa is bound by the gazetted Notice and is required to ensure its implementation, hence the draft Rules. The Rules will be processed following due regulatory process which includes stakeholders’ comments and inputs,” said Nersa’s Head of Communications, Charles Hlebela.
The regulator added that the Minister of Energy recently amended the gazetted Licensing Exemption and Registration Notice. This has necessitated the review of the Consultation Paper on the draft Rules to be aligned with the amended Licensing Exemption and Registration Notice.
“Nersa is committed to ensuring that Rules for Registration of Small-Scale Embedded Generation are processed or developed by following due regulatory process. Stakeholders will again be given an opportunity to provide their written comments, views and inputs,” it said.
At the time of the publication of the rules, the regulator said comments could be sent to its offices in Tshwane (526 Madiba Street) by 31 May 2018.
The draft rules can be accessed on: http://www.nersa.org.za/Admin/Document/Editor/file/Consultations/Electricity/Documents/Consultation%20Paper-Rules%20for%20Registration%20of%20SSEG.pdf
Alan Straton
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