The Pretoria High Court has overturned all three electricity generation licences granted to Karpowership by the National Energy Regulator of South Africa (NERSA), formally ending the company’s involvement in the Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP).
The order, issued yesterday (July 31), confirms a settlement between NERSA and the Organisation Undoing Tax Abuse (OUTA), which brought the legal challenge in 2022. Karpowership withdrew from the case earlier this year after its South African entities were liquidated.
The RMIPPPP was launched in 2020 to fast-track 2 000 MW of dispatchable power and address load shedding through short-term generation solutions.
Karpowership was named a preferred bidder in March 2021 to supply 1 220 MW from floating gas-to-power ships at Richards Bay, Coega and Saldanha Bay under 20-year contracts worth around R200 billion. The licences, issued by NERSA in 2021, were contingent on reaching financial close, and securing port and environmental approvals.
Although environmental authorisations were later granted, the company failed to meet key conditions, including financial close and grid integration by the December 2023 deadline. Eskom subsequently terminated its procurement processes related to the projects.
OUTA’s review application cited irregularities in NERSA’s decision-making, including lack of port authority approvals and incomplete power purchase agreements. After extended delays in accessing NERSA’s administrative record, the High Court found the licensing process unlawful and ordered NERSA to pay costs.
“This case reinforces the principle that, even when government acts urgently, the law and due process cannot be ignored,” says OUTA’s Executive Director Stefanie Fick.
