Johannesburg-based finance company Investec has been awarded an energy trading licence by the National Energy Regulator of South Africa (NERSA).
The license allows the bank to buy and sell energy to independent power producers and corporate clients within South Africa.
Investec first announced its application for a license in May. According to a statement on the bank’s website, it will use the license to purchase solar power from the Ilikwa Solar PV facility. The project, with a planned capacity of 50 MW, is currently under construction and is expected to come online during the second quarter of next year.
Third-party participation in South Africa’s electricity trading market is being facilitated by the development of a third-party wheeling framework, of which NERSA approved the regulatory foundation earlier this year.
Investec’s statement adds that the recent regulatory changes “have opened South Africa’s energy sector to new entrants and innovations, with energy trading increasingly recognised as a critical enabler of the transition to clean, reliable, and sustainable power.”
NERSA also approved energy trading licenses for Solis Energy Trading, SOLA TradeCo and LinkSolar this month. Chris Ahlfeldt, energy specialist at Blue Horizon Energy Consulting Services, told pv magazine that there are now 14 private companies with a trading license in South Africa.
“It will be interesting to see what business models these licenses enable with the new South African Wholesale Electricity Market that’s scheduled to open in April next year,” Ahlfeldt added. “How will these traders be allowed to engage in the short-term wholesale market and which customers will they be able to on-sell electricity to will be confirmed once the electricity market rules are finalized later this year.”
Eskom raised a legal challenge against some of the earlier trading licenses granted by NESRA, although no objection to the regulator’s most recent approvals has been made. In August, South Africa's Energy & Electricity Minister, Kgosientsho Ramokgopa, publicly urged Eskom to drop its legal challenge related to the regulator’s trading licences.
“It’s a positive sign for competitive reforms to see NERSA continue to approve new trading licenses and that Eskom didn’t object like they previously did to the last round of approvals,” Ahlfeldt added. “South Africa’s ongoing electricity reforms and commitment to introducing competition in the wholesale electricity market sector are key steps to ensure low-cost and clean energy gets deployed in the country at scale.”
This content is protected by copyright and may not be reused. If you want to cooperate with us and would like to reuse some of our content, please contact: editors@pv-magazine.com.
By submitting this form you agree to pv magazine using your data for the purposes of publishing your comment.
Your personal data will only be disclosed or otherwise transmitted to third parties for the purposes of spam filtering or if this is necessary for technical maintenance of the website. Any other transfer to third parties will not take place unless this is justified on the basis of applicable data protection regulations or if pv magazine is legally obliged to do so.
You may revoke this consent at any time with effect for the future, in which case your personal data will be deleted immediately. Otherwise, your data will be deleted if pv magazine has processed your request or the purpose of data storage is fulfilled.
Further information on data privacy can be found in our Data Protection Policy.