Cape Town awaits ruling on whether it may buy electricity from private producers

The city of Cape Town is awaiting a court ruling on whether it can buy its own electricity from suppliers other than national power utility Eskom Holdings SOC Ltd. without getting approval from the energy minister.

Judge Leonie Windell of South Africa’s High Court on Tuesday reserved judgment in the case between the city and the energy ministry and the National Energy Regulator of South Africa.

The case could pave the way for South African municipalities to bypass the ministry and source their own power, much of it from renewable sources.

It would also reduce revenue for Eskom, which produces most of its energy from coal and is saddled with R454 billion ($25 billion) in debt. Eskom’s inability to supply sufficient power has resulted in repeated power cuts.

“Allowing municipalities to contribute to ensuring supply security is an important avenue to returning South Africa to a reliable and secure electricity system,” said Jesse Burton, a senior associate at E3G, an independent London-based climate change think-tank.

“National government continues to tie municipalities to the high-cost future of expensive Eskom and expensive new coal plants, just as cities worldwide become sites of innovation and climate ambition.”

Burton provided an expert statement for the Centre for Environmental Rights, an environmental legal organization that is an amicus to the case.

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Cape Town awaits ruling on whether it may buy electricity from private producers