Premier

I am informed that:

1. (a)(i) How does the MIPPP assist municipalities with the preparation for generating their own electricity and

The Municipal Independent Power Producer Programme (MIPPP) is supported through the Western Cape Government’s Energy Project Preparation Facility (PPF), that is facilitated by the Department of Infrastructure (DOI) as part of the Western Cape Energy Resilience Programme (ERP).

The PPF provides municipalities with access to highly specialised technical, legal, financial and transaction advisory support required to develop electricity‑generation projects to a bankable stage. This includes the preparation of feasibility studies, financial models, regulatory compliance work, socio‑economic development planning, risk allocation, and the drafting of tender and contracting documentation.

These services enable municipalities to take full advantage of recent national regulatory reforms that allow them to procure and contract their own electricity-generation capacity.

(ii) why are municipalities in need of this support,

Municipal energy procurement is a technically complex, highly regulated and relatively new field. Most municipalities do not have the internal capacity, specialised skills or resources needed to undertake project preparation or manage Independent Power Producer (IPP) procurement processes on their own. The PPF therefore accelerates compliance, reduces risk, and ensures that municipalities can engage the market in a legally sound and financially sustainable manner.

(b)(i) which municipalities have been assisted with going out to tender for municipal energy generation projects,

Support to date includes:

• Direct feasibility and procurement support: Stellenbosch Municipality (through the MIPPP pioneering project), and under the PPF: Saldanha Bay, George and Swartland municipalities.
• Targeted technical or advisory support: Bergrivier, Breede Valley, Cape Agulhas, Cederberg, Drakenstein, Matzikama, Prince Albert and Bitou.
• In addition, the MIPPP “Lessons Learned” document from the Stellenbosch pilot has been shared with the Municipal Manager of every municipality in the Western Cape. All municipalities have therefore received some form of assistance.

(ii) how many of these were renewable energy projects,

All of the projects supported to date involve solar photovoltaic (PV) generation as their primary technology.

(iii) what is the value of these projects and (iv) how many kw/h will be generated by these projects and

The PPF has supported municipalities up to feasibility and tender‑document preparation. No projects have yet reached commercial close; therefore, final project values and contracted generation figures cannot be stated at this stage. However, the projects currently under preparation fall broadly within the range of 2.5 MW to 100 MW.

(c)(i) how are municipalities able to access the MIPPP and (ii) what are the criteria to qualify;

Municipalities may apply to the PPF either through the designated online application form (available at: https://forms.office.com/r/jHj7NxTJkz ) or by submitting a completed manual application form. The criteria approved by the Western Cape Energy Council includes:

1. Demonstrated need to supplement internal capacity.
2. Municipal readiness, including possession of a NERSA generation licence where applicable.
3. Financial sustainability, including achieving at least two consecutive unqualified audits.
4. Good governance and an enabling policy environment.
5. Extent of prior support received and the further support required.
6. Assessment of project‑related risks.
7. Urgency and readiness to approach the market.
8. Evidence of private‑sector interest.
9. Anticipated economic impact (jobs and investment).
10. Size of the funding request relative to available budget.
11. Presence of co‑funding or external funding.
12. Alignment with the Western Cape Energy Resilience Programme.
13. Renewable‑energy potential based on authorised projects in the Western Cape Energy Pipeline.

All municipalities are eligible to apply, but project selection is based on these criteria to ensure optimal impact and prudent allocation of public resources.

2. Whether the MIPPP assesses project affordability to ensure municipal financial sustainability; if so, what are the relevant details?

Yes. The PPF includes a value‑for‑money and affordability assessment as part of each project’s feasibility study. A specialised analytical tool has been developed to assess:

• the municipality’s historical and projected energy‑use profile,
• expected solar PV generation,
• comparison with current and projected Eskom tariffs, and
• an affordable tariff band for long‑term Power Purchase Agreements (PPAs).

Once PPF-supported projects reach contracting stage, the municipality’s preferred bidder tariff will again be tested against these affordability parameters to ensure compliance with the Municipal Finance Management Act and long‑term municipal financial sustainability.