South Africa’s environmental authorities have rejected an application to run floating power plants at three major ports, effectively scuppering a major part of the government’s plan to end the widespread rolling electricity blackouts that have undermined growth.
Turkish company Karpowership wanted to sail LNG-fuelled powerships to Africa’s most industrialised economy but the environment ministry rejected the plan after “due consideration of all relevant information presented as part of the environmental impact assessment process”.
The rejection is set to scupper a prospective $15bn, 20-year deal for the company, one of the biggest ever in the global market for floating power stations — and worsen a growing scandal for President Cyril Ramaphosa’s government over how the deal was made.
The energy ministry named Karpowership the preferred bidder in March this year as part of efforts to allow the broken Eskom power monopoly to turn itself round. Karpowership, a unit of Turkey’s Karadeniz, has been racing to meet a July deadline for financing and approval of the projects.
But in recent weeks, the deal has been criticised by activists and the main opposition to Ramaphosa’s ruling African National Congress for its expense, impact on the environment and allegations of rigging.
Karpowership’s South Africa unit said the government had “allowed a misinformation campaign, funded by special interests” to derail the plan to procure emergency power.
“South Africans should understand that the decision . . . threatens the delivery of this power and will extend load shedding for years to come,” it added. The company will appeal against the decision.
The decision on the environmental permits reflects “a collective effort by many voices in civil society”, said Liziwe McDaid, a member of Green Connection, a group which has campaigned against the powerships.
Green Connection alleges that environmental concerns had not been properly considered, including the impact on local fishing communities. The environment ministry “realised that voices of coastal fishers were important and had not been heard”, McDaid said.
Karpowership said it had complied with all of the environmental requirements for approval of the projects.
South Africa launched the emergency power procurement in late 2019 as Eskom descended into its worst ever blackouts. The outages have returned in force in recent weeks as Eskom’s coal fleet keeps breaking down.
A losing bidder is also suing the energy ministry for allegedly rigging the process in favour of Karpowership. The ministry and the company both deny wrongdoing.
Karpowership operates floating plants in several countries from Ghana to Indonesia. It recently switched off its supply to Lebanon in a dispute over payment — cutting off about a quarter of the Levantine nation’s electricity generation overnight.