The City of Cape Town v. National Energy Regulator of South Africa and Minister of Energy

Summary:

With the goal of diversifying its electricity consumption with less reliance on the existing sources of energy, the City of Cape Town decided to purchase more renewable energy from independent power producers (IPPs). Despite following the required steps to seek consent from the Minister of Energy to approve the purchase of solar and wind power from an IPP, the Minister failed to respond for over two years. The Minister eventually communicated that all applications were on hold for an indefinite period.

The city asks the court to issue an order declaring that the Minister of Energy’s consent is not required for an IPP to establish a new power plant and supply electricity to the City. Alternatively, the City requests an order declaring section 34 of the Electricity Regulations Act 4 of 2006 (ERA) unconstitutional and invalid because it impermissibly imbeds upon the constitutional powers and functions of local government. The City argues that it has a constitutional right to procure energy in the manner it deems best.

On August 11, 2020, the court postponed the application since it considered the issue an intergovernmental dispute that should be settled outside the court, and referred the dispute back to the parties. The application is postponed indefinitely.

At Issue: Whether the City of Cape Town needs consent from the Minister of Energy to approve the purchase of solar and wind power from an IPP.