Status of Small Scale Embedded Generation (SSEG) In South African Municipalities

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1 Status of Small Scale Embedded Generation (SSEG) In South African Municipalities - October 7 Status of Small Scale Embedded Generation (SSEG) In South African Municipalities

2 Status of Small Scale Embedded Generation (SSEG) In South African Municipalities - October 7 Status of small scale embedded generation (SSEG) in South African Municipalities October 7 Background What is SSEG: Small-scale embedded generation (SSEG) refers to power generation facilities, located at residential, commercial or industrial sites, where electricity is generally also consumed. These are mainly solar photovoltaic (PV) systems but include also other technologies such as wind and biogas. A SSEG customer generates electricity on the customer s side of the municipal electricity meter, where the generation equipment is connected to, and synchronised with, the municipal electricity grid (i.e. embedded ). In recent years there has been an increasing interest in SSEG. This is due to increasing price of grid-electricity on the one hand and decreases in SSEG system prices on the other hand. Latest News!! Update in Regulation: Schedule of the Electricity Regulation Act was officially amended in November 7 and now exempts certain power generation facilities less than MW in size to have a generation license. If an installation meets the criteria as stipulated in the amended schedule, the installation can be registered with NERSA instead of requiring a license. NERSA announced in December 7 that they are working on regulatory rules to ensure efficient registration of these installations. SALGA expects that the distribution operators, i.e. municipalities or Eskom, would be in charge of registering the installations and report to NERSA. To consult the amendment please visit opengazettes.org.za/archive/za/7/ government-gazette-za-vol-69-no- 47-dated-7--.pdf (from page 9 ). National Overview The information below represents the best level of information obtained by SALGA on the uptake of SSEG processes and tariffs in municipalities by October 7. The sector is rapidly evolving and this information may easily become outdated. This information was obtained from feedback from municipalities. Figure shows the upward trend of municipalities adopting SSEG processes.

3 Status of Small Scale Embedded Generation (SSEG) In South African Municipalities - October 7 Uptake of SSEG processes in municipalities 4 Name of Municipalities Allowing SSEG installations With official application system With SSEG tariffs 5 Feb -6 Aug Nov -6-6 Oct7 Figure : Trend in uptake of SSEG processes in municipalities Provincial Overview Table and Figure below gives a provincial breakdown of municipalities which:. allow SSEG installations on their electricity grids,. have established application processes for customers to apply and get authorisation to connect their systems to their electricity grid and. have NERSA-approved SSEG tariffs, allowing them to compensate customers for excess electricity fed back onto their electricity grid.

4 Status of Small Scale Embedded Generation (SSEG) In South African Municipalities - October 7 Province Eastern Cape Free State Gauteng KZN Limpopo Mpumalanga Northern Cape North West Western Cape National Percentages of licensees Under development Number of Number of Number of Number of municipal municipalities municipalities municipalities electricity allowing SSEG with official with SSEG distributors in installations application tariffs * each province* system % % % 8 8 Table : Provincial breakdown of SSEG uptake * The number of municipal electricity distributors in each province is an estimate by SALGA based on the 77 distribution licenses issued to municipalities by NERSA and the municipal mergers which have occurred over time. These numbers are used to calculate the percentages of municipalities active on SSEG in Figure. 4

5 Status of Small Scale Embedded Generation (SSEG) In South African Municipalities - October 7 Provincial breakdown of SSEG uptake % 8% 6% 4% % % Eastern Cape Free State Gauteng Eastern Cape KZN Limpopo Mpumalanga North West Western Cape National Percentage of municipalities allowing SSEG without application processes or tariffs Percentage of municipalities allowing SSEG with application processes only Percentage of municipalities allowing SSEG with application processes and tariffs Figure : Percentage of municipalities within each province allowing SSEG installations, adopting SSEG processes and have approved tariffs in place. Table below gives a more detailed overview of the municipalities that allow SSEG installations within their municipalities, either on a case by case basis or through an application process. Province Province Eastern Cape Buffalo City Metropolitan Beaufort West Local Kouga Local Bergrivier Nelson Mandela Bay Breede Valley Local Free State* Mangaung Metropolitan Western Cape City of Cape Town City of Johannesburg Cederberg City of Tshwane Drakenstein Gauteng Ekurhuleni Metropolitan Midvaal Local George Local Laingsburg 5

6 Status of Small Scale Embedded Generation (SSEG) In South African Municipalities - October 7 Province Province KZN Ethekwini Langeberg Mossel Bay Ephraim Mogale Local Oudtshoorn Limpopo Polokwane Overstrand Govan Mbeki Prince Albert Local Mpumalanga Steve Tshwete Local Western Cape Saldanha Bay Dawid Kruiper Stellenbosch Gamagara Local Swartland Northern Cape Theewaterskloof Local Sol Plaatje Witzenburg Table : List of municipalities per province that allow SSEG installations *Mafube has an approved SSEG tariff in place, however the municipality has not indicated whether or not it allows SSEG installations or has SSEG application processes More information Some municipalities have published information online regarding their SSEG processes and requirements, or have addresses which can be contacted for more information. Other municipalities listed in Table don t yet have information online. In this case, the municipal electricity department can be contacted. Nelson Mandela Bay: aspx?pageid=9 Johannesburg: distributedgeneration@citypower.co.za Tshwane: SSEG@tshwane.gov.za Ethekwini: Polokwane: Documents/COP%Forms/Registration%for%Small-Scale% Embedded%Generation%Form%7.PDF Cape Town: Overstrand: 6

7 Status of Small Scale Embedded Generation (SSEG) In South African Municipalities - October 7 If you feel the information regarding a particular municipality is incorrect or if you would like to provide additional information, please contact SALGA using the contact details given at the end of this document. SSEG installations provide opportunities and risks for municipalities and need to be managed properly. The objective of SALGA is to facilitate the adoption of small scale embedded generation in a way that preserves the financial and technical integrity of municipal distribution systems. With this in mind, the AMEU SALGA SSEG Resource Pack provides templates for municipalities to establish sound SSEG permitting procedures. More documents are under development and will be added to the pack which currently contains 5 documents:. Technical requirements for Embedded Generation: za/uploads/resource_4.pdf. Application Form: Commissioning Report: 4. Customer Service Contract: pdf 5. Decommissioning Report: php?id=4&category=5 A tariff model tool has been developed to () measure the financial impact of proposed SSEG tariffs on municipal finances; and () evaluate the business case for customers who have installed solar PV systems based on the proposed SSEG tariffs. The model is available on together with a training presentation ( and users guideline Additionally PV Green Card ( has been developed by SAPVIA, the South African PV Industry Association to promote safe and high-quality installations. SALGA, with support from other partners, are actively assisting municipalities in developing SSEG systems and processes. Should any municipality need support, please contact SALGA using the following details: Lungile Manzini: lmanzini@salga.org.za or 69 8 Ryan Roberts: rroberts@salga.org.za or

8 Status of Small Scale Embedded Generation (SSEG) In South African Municipalities - October 7 Contact Details: Telephone: () 69 8 Fax: () 69 8 Physical Address: Menlyn Corporate Park, Block B 75 Corobay Avenue Cnr Garsfontein and Corobay Waterkloof Glen ext Pretoria Social Media Facebook: South African Local Government Association (SALGA) YouTube: SALGA TV With Support From 8