South Africa: Turkish Firm Offers to Cut 20-Year Power Deal to Five Years, But There’s a Catch

Harare — Karpowership offered to reduce the initial 20-year contract to five years in an apparent effort to get a multibillion rand “emergency” electricity supply arrangement with South Africa, according to a Daily Maverick report.

However, there is a catch: a shorter contract would cost more money. The Council for Scientific and Industrial Research (CSIR) estimated that the transaction might cost as much as R228 billion (approximately U.S.$12,1 billion), but the precise amount is still unknown.

The five-year deal proposal follows the protracted debate over the merits of procuring power from the Turkish company. Karpowership Chief Commercial Officer Zeynep Harezi reportedly said that her company was prepared to send five floating powerships to South Africa and to start producing electricity within “90 days” or less.

In July, South African Environment Minister Barbara Creecy rejected appeals from five environmental organizations that attempted to prevent the firm from requesting permission to erect a 450 megawatt gas-fired facility at the port of Richards Bay on the northeast coast.

In a separate judgment, she permitted Karpowership to seek environmental approval at Saldanha on the west coast, overturning her department’s earlier decision to reject authorization for a 320-megawatt operation.

Since winning nearly 60% of a state tender in March 2021 for 2,000 megawatts of emergency electricity to address the crisis, Karpowership has been working on three projects, according to Bloomberg. However, a disagreement over the positioning of the power ship with the national port operator will cause a delay in the 450 megawatt project at the Port of Ngqura. It was said that the delay in Ngqura might be anywhere between 12 and 18 months as a result of the requirement to locate a new spot in the harbor for the ship to moor.

With South Africa looking to Kapowership to assist with its load shedding crisis, concerns have been raised at the cost and the length of time of the contracts, as well as its impact on the environment.

The Karpowership deal is aimed to lessen the impact of load shedding on the country which has affected the economy, most notably small businesses, with up to 64% of township small businesses stopping operations during scheduled power cuts.


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