The Organisation Undoing Tax Abuse (Outa) has won a court challenge against Karpowership and the National Energy Regulator of South Africa (Nersa) giving the civil rights organisation access to the unredacted record of the regulator’s decision to approve licences for the power vessels.
The Pretoria High Court was supposed to hear Outa’s application to compel the National Energy Regulator (Nersa) to provide it with the full, unredacted record of Nersa’s decisions to approve generation licences for Karpowership but the company recently withdrew its opposition and Nersa offered to settle minutes before the trial was supposed to start.
This comes after Minister of Mineral Resources and Energy, Gwede Mantashe, in February 2020 made a determination that 2 000 MW of emergency generation capacity should be procured. Three Turkish Karpowership projects were given the green light to provide 1 220 MW of gas-fired generation capacity to the country over a 20-year period.
Outa opposed the cost, environmental impact and length of the controversial contract, and filed a court application for Nersa’s decision to grant Karpowership independent power producer (IPP) licences to be reviewed and set aside. Nersa and Karpowership opposed the application.
“Outa strongly believes that Nersa’s decision should be reviewed and set aside as it was procedurally unfair, premature and lacking in transparency. Outa, in the main application (the review application), called for Nersa to provide copies of all documents relating to the decisions to grant Karpowership the generation licences, together with the reasons for the decisions,” said Stefanie Fick, Outa’s accountability division executive director.
Nersa provided only a redacted version of the record in June 2022, and Outa then asked the court to compel Nersa to produce the full, unredacted record of its decision. The application was set down for hearing on June 4 and 5.
However, just before the hearing, Nersa’s attorneys presented a settlement agreement in which it agreed to provide the full unredacted record, subject to a confidentiality regime.
Outa partially accepted the settlement agreement, reserving its right to argue at the review hearing that the provided record, which Nersa and Karpowership believe to be confidential, should be made publicly available. Nersa accepted this and the court handed down a consent order.
On the issue of costs, Outa asked the court to award a punitive cost order against both Nersa and Karpowership due to their conduct in the matter.
During court arguments it emerged that Nersa was only willing to settle because Karpowership had permitted it to conclude confidentiality agreements.
“It is despicable to think that Nersa, our independent national energy regulator, will keep information away from public scrutiny unless it is given permission to do so by third parties. Transparency is crucial for accountability, and when parties want to do business with government they should accept that their conduct will be under a microscope,” Fick said.
The court ruled that Nersa and Karpowership pay the cost of the application on a punitive scale, including the cost of Outa’s counsel.
The main application for a review of Nersa’s decision to grant the Karpowership licences continues.
