Does a municipality need licensing to construct a waste-to-energy plant for own use?

Question: One does not need licensing to construct a power plant in South Africa if it is for “own use”. Businesses can install power plants for “own use” without a licensing requirement. What about when it comes to municipalities if you develop a waste-to-energy project as a municipality. Would this still be defined as “own use”?

Answer: The term “own use” is not clearly defined in the legislation. But it is clear [that] from a municipality point of view if you generate and sell it to your customers it is not “own use”. So if you, as a municipality, would want to designate a power station that you have built yourself for “own use”, it would have to be clearly indicated in some way or another that it is for things like street lighting, technical losses on your system or any such consumption on the local authority network. But [this] is a legal interpretation that might be tested in court. It is my view that it is definitely more difficult for a local authority to ring-fence such a power plant for own use only.

The above question was asked during a plenary session at the Wind Power Africa 2010 conference in Cape Town and was answered by Ferdi Kruger, regulatory specialist of the National Energy Regulator of South Africa (NERSA). The above is an edited version of the original answer and reply.

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