Local Government, Environmental Affairs and Development Planning
During the 2023 Western Cape State of the Province Address (SOPA), the Premier mentioned that the Western Cape provincial government will make R89 million available to Western Cape municipalities in a form of emergency funding for the purpose of purchasing back-up generators:
- Whether there are any specific targeted municipalities to whom this emergency funding will be allocated; if not, will all municipalities benefit irrespective of the financial resources that they may have at their disposal; if so, what are the relevant details;
- what pro-active mechanisms will be used to monitor every rand granted to each municipality to make sure that the funds are used for its intended purposes;
(3) whether the Cash for Power Project is only intended to benefit wealthy households financially; if not, how are poor households going to benefit from this project?
- All the municipalities in the Western Cape were allocated funding irrespective of their financial resources, with the exception of the City of Cape who is currently implementing their own response strategies. As part of the Department’s consultation processes, every municipality was given an opportunity to submit their energy back up strategies and priority requirements to ensure the continuity of water and sewer services during loadshedding.
See attached Annexure A.
This Grant is managed by the Provincial Department of Local Government (DLG). In order to manage this Grant and expenditure by recipient municipalities, the Department assigned engineers and project managers to oversee and monitor progress, expenditure and compliance with the Grant conditions. In addition, each municipality has signed a Transfer Payment Agreement (TPA) with the DLG before funds were transferred. The TPA will include the conditions that the funds are subject to, and the responsibilities the recipient municipality must fulfil while procuring and installing the generators.
The Cash for Power project is a City of Cape Town Programme. Previously the commercial customers who produced excess electricity could not sell it back (wheel) to the City of Cape Town (CoCT). The City recently received a National Treasury exemption, which allows businesses and residential households may be paid directly for excess power produced and fed back into the grid. The City is first focusing on commercial customers and will also offer the same incentives to households irrespective of their social class.
This power demand management strategy will have great impact on lowering stages of load-shedding within the City of Cape Town and may, in turn be rolled out by other municipalities in the Province, if successful. This strategy is in line with the Provincial Energy Short-term Strategy of using energy demand management as the first step, whilst putting in place medium to long-term energy solutions to eventually become independent from the national grid.
