Trade, industry & competition minister Ebrahim Patel has published block exemptions for energy users and suppliers in terms of the Competition Act.
The exemptions (PDF) will have a direct bearing on telecommunications operators, which are struggling to keep their towers and other infrastructure operational during higher stages of load shedding. They allow collaboration between companies, including direct competitors, to address South Africa’s electricity constraints, even activities normally prohibited by the Competition Act.
“These exemptions will enable energy suppliers and energy users to increase supply capacity, reduce the cost of energy or improve the efficiency of energy supply, and secure backup or alternative energy supply to minimise the effects of the current electricity supply constraints,” Patel said.
“Reforms to competition law in 2019 provide for more flexibility when circumstances warrant it. The block exemptions have been used during the pandemic and in crises such as the July 2021 unrest to enable competitors to cooperate to address shortages of stock or facilities. This will now also be available to companies to address the energy challenges.”
Energy users will be able to secure backup or alternative energy supply through joint procurement, and to share backup and energy generation capacity. The exemptions will also support joint negotiation and purchase of energy, related products and services.
The aim of the block exemptions is to help companies work together to secure alternative energy supplies, reduce energy costs and secure shared or adjacent sites, infrastructure, equipment and facilities.
A Vodacom spokesman told TechCentral that in terms of shared infrastructure resources across the industry, collaboration is effected in accordance with the Competition Act. “We welcome the release of the energy users block exemption but are still in the process of assessing its impact and the change it might bring for the industry,” he said.
An MTN spokeswoman said the exemptions will allow it to collaborate with competitors and “vertical players” to procure and finance backup energy solutions jointly; share backup power; and engage in energy optimisation and infrastructure security initiatives to mitigate the impact of the ongoing power crisis.
The exemptions will not allow energy suppliers to fix the price of goods and services to customers and will not allow them to engage in collusive tendering or practise resale price maintenance, and will remain in effect until withdrawn by the minister. — (c) 2023 NewsCentral Media