• Infrastructure

Alweendo revokes ECB decision on Ongos

- 2023-10-26 08:07:00

Tom Alweendo, the Minister of Mines and Energy, has used his ministerial powers to overturn the electricity regulator's decision on the controversial Ongos Valley Development's (OVD) plan to generate its own power.
As details about the case emerge, it appears that the Electricity Control Board (ECB) initially recommended that the minister rejects the OVD's application for a distribution and supply licence. This licence will allow OVD to generate electricity and sell it to its end users. This even though the development is located within municipal boundaries.
The ECB notified Alweendo on 22 April 2022 that it objects to OVD being granted permission to operate under the City of Windhoek's (CoW) licence, saying it is in a position to supply electricity to all end-users within municipal boundaries.
"The municipality is in a position to provide [power] to OVD by the project's timelines. The CoW was correct in insisting that cost recovery should be done through the customer-funded model. The objective of tariff harmonization in the city's distribution licence area will be negatively affected if OVD is allowed to charge a different tariff to recover the costs of the distribution and supply infrastructure," the recommendations read.
With his reasons for the approval, Alweendo - in a letter dated 19 August 2022 - stated that the CoW had unfairly refused OVD's licence application.
'No answers received'
“I offered [the CoW] the opportunity to either reimburse OVD for its investment or allow it to operate under [the CoW's] licence. No answers have been received from the [CoW] regarding these two options,” Alweendo said.
With permission, Alweendo said the development would be allowed to operate under the municipality's distribution and supply licence, on the condition that it operates for 15 years, or until it has recouped its investment.
OVD is also expected to transfer its distribution assets to the COW after 15 years, or when it has recouped its investment.
The minister added that a lack of communication from the CoW left him with no choice but to grant a licence to OVD, according to a letter – dated 31 October 2022 – to the capital's then-mayor, Sade Gawanas.
"I have requested the CoW to announce its decision on the matter before or on 2 August 2022. Failure to do so will result in me permitting OVD to operate under the license of the [CoW], in terms of Section 34 (1) of the Electricity Act.”
The ECB informed OVD of the minister's approval and said he would be able to use the municipality's generation and supply licence, effective 1 September 2022, for 15 years.
Robert Kahimise, the chief executive of the ECB, declined to comment, saying the case was sub judice.
On 11 September, the city council submitted a court application requesting that Alweendo's decision be set aside.
The council is represented by Gilroy Kasper, OVD by Appolos Shimakeleni, the ECB by Fisher, Quarmby & Pfeifer, and the Ministry of Mines by state attorneys.