Outa demands full record of Karpowership decision in new court battle

The Organisation Undoing Tax Abuse (Outa) has filed a fresh application in the Pretoria High Court to compel the National Energy Regulator of South Africa (Nersa) to divulge information about the financial implications of the electricity generation licences it granted to Turkish energy company Karpowership.

The application, filed on 23 January, seeks to get Nersa to provide Outa with a full and unredacted record of the energy regulator’s decision to award generation licences to Karpowership. The latter wants to operate power ships at several ports in the country, including the Saldanha Bay, Coega and Richards Bay ports.

Outa has accused Nersa of dealing in secrecy, saying that critical details relating to the financial implications of the deal, a 20-year contract with a value estimated at more than R200 billion, remain hidden.

The new court application relates to Outa’s main application launched in April last year, which sought to have the power generation licence approvals to Karpowership reviewed and set aside.

Redacted details

Since Outa’s initial court application, Nersa and Karpowership have provided redacted records of the licensing decision.

Outa legal project manager Brendan Slade said since its initial court application, the full details of the decision have not been made available.

“Records and information cannot be confidential, simply because somebody says it is confidential. We believe the information may highlight the financial implications of the deal,” he said.

Outa has estimated the cost of Karpowership’s power at R5/kW (which it says is roughly two to three times the cost of alternative generation solutions), compared with Nersa’s proclamation of R2.80/kWh.

“The redacted record does not include information on the impact of the rand/dollar exchange rate, any licence conditions, charge rates or tariffs,” the organisation said.

The cost of load shedding

Outa’s newest court bid comes as the government attempts to fast-track the deployment of the floating power ships, with the country dealing with the worst continuous load shedding ever experienced and Eskom implementing permanent rolling blackouts for the next two years.

Mineral Resources and Energy Minister Gwede Mantashe recently said South Africans do not have the luxury of refusing Karpowership’s plants, saying the cost of having load shedding is far worse.

“It is a luxury for South Africans to say we don’t want Karpowerships, when those Karpowerships work in Côte d’Ivoire, they work in Ghana, they work in Gabon, they work in Brazil,” said Mantashe.

He added that although operating the power ships would come “at an enormous cost” they represent “a huge saving”.

“The cost must be compared to the cost of load shedding … it costs us more to be on load shedding,” said Mantashe.

Outa disagrees.

“Despite the current energy crisis, Karpowership is certainly not the answer. We continue to protect the public from this costly vanity project,” said Slade.