The City of Cape Town has recently announced businesses and households have already earned over R25.8 million under the City’s Cash for Power programme since the start of the 2022/23 financial year.
The City says it is the first metro in South Africa to buy excess solar photovoltaic (PV) power from small-scale generators in exchange for municipal bill credits and cash. But what is the programme all about and how do you participate in it?
How does the programme work?
Cape Town has launched its "Cash for Power" initiative, inviting residents to participate by selling excess PV or small-scale embedded generation (SSEG) power back to the city's grid. Previously, customers were constrained to consume more power from the grid than they could feed back into it. However, the City has lifted this restriction, allowing customers to contribute their surplus energy.
Under this programme, the City compensates participants with credit for the excess power they supply. These credits can then be applied towards settling municipal accounts. Once an account is settled, any remaining credit will accrue until it reaches R1,000 for residential entities or R5,000 for commercial entities.
At this stage, the City will issue payments to the customers.
To be eligible to apply, customers must have a grid-tied solar PV system equipped with a City-approved inverter. This ensures that participants meet the necessary requirements to contribute to the City's renewable energy goals while benefiting from the Cash for Power initiative.
The programme is aimed at revolutionising how energy is produced and consumed in the city. Spearheaded by Cape Town Mayor Geordin Hill-Lewis and the City's energy team, this innovative programme offers commercial and residential customers the opportunity to monetise their excess electricity production.
This initiative is bolstered by a unique 25 cents per kilowatt-hour (kWh) incentive, a feature unparalleled in South Africa's energy landscape.
The programme kicks off by focusing on commercial customers, leveraging existing grid-tied installations, which numbered over 2,600 as of December 2022.
The registration and authorisation process is free, though some installers may charge for assistance.
How to participate in the Cash for power programme
To participate in the Cash for Power initiative, customers must install PV systems and inverters.
The City facilitates the authorisation process for grid connection, ensuring seamless integration into the existing infrastructure.
Once authorised, participants are placed on the Non-Residential Small Scale Embedded Generation tariff, ensuring fair compensation for the energy they contribute to the Eskom grid.
The financial benefits are substantial. Participants receive credits on their municipal bills for the energy fed back into the grid. These credits can be utilised to offset future energy expenses.
Additionally, for commercial customers, there's an option for cash payments for any excess credits accumulated.
Cape Town aims to purchase as much solar power as households and businesses can supply, with a total of 25 million kWh already bought as of February 2024.
By incentivising the production and sale of renewable energy, the programme not only drives economic growth, but also fosters a more sustainable and resilient energy future for Cape Town.
As the programme continues to evolve, it is poised to serve as a model for other cities seeking to embrace decentralised energy solutions and combat climate change.
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