The City of Cape Town has approved multi-billion rand contract for the supply of electricity from an Independent Power Producer.
The City of Cape Town has secured a R5.1 billion contract with an Independent Power Producer, aiming to enhance energy security and reduce tariffs, despite concerns over its impact on residents.
The contract to be entered into with Make A Difference Ventures is one of the several multi-year tenders that span over three years.
“The rate of inflation under this contract will be based on the consumer price index as opposed to Eskom’s increases which are unpredictable and have shown to be considerably higher than consumer price index," reads the report tabled in council last week.
It further said the rate under the contract was lower than the rate the City currently purchases electricity from Eskom. Adding that consumers will benefit from the contract through possible reduction in tariffs and rate of tariff increases and the City’s savings over the 20-year period was estimated at R1.7 billion.
