NERSA approves establishment of the electricity market advisory forum

THE energy regulator has approved the establishment of the Electricity Market Advisory Forum (EMAF), which will advise the NERSA on various matters related to the establishment of a competitive electricity market. 

Members will be appointed by, and  accountable to NERSA with an approved term of reference. 

The decision of the energy regulator recognises the profound changes anticipated in the electricity  sector and the role of the energy regulator, heralded by the amended Electricity Regulation Act, 2006, which includes the  establishment of a competitive electricity market over the next five years. 

The EMAF is a proactive move  to involve stakeholders to support the Energy Regulator to establish a robust and inclusive regulatory  environment to oversee the nascent electricity market. 

This includes licensing the Market Operator as the National Transmission Company of South Africa’s (NTCSA) licensed activity and approving the  Market Rule and Market Code. 

The impending electricity market will involve regulatory activities that are novel in the South African  environment – such as the task of market surveillance and enforcement alluded to in the draft South  African Wholesale Electricity Market (SAWEM) Code. 

The regulator, cognisant of the need to  garner advice from stakeholders and experts, also appreciates the need to simultaneously accelerate  institutional strengthening as a key enabler for an efficient electricity market. 

An inclusive consultation process, such as the establishment advisory forum, should also encourage the  readiness of all stakeholders for the market as it evolves. 

The advisory forum will initially focus on advising  the regulator on the finalisation of the Market Rule and Market Code. The EMAF will also advise  on key enablers required to establish a competitive electricity market, including the implementation of the Market Rule and Market Code and regulatory oversight of market operations.

The regulator will outline the process for appointing members to the EMAF in due course. 

It is anticipated that the EMAF’s strength will lie in the appropriate blend of institutional representation with  individual expertise in establishing, operating and monitoring a functioning and competitive electricity  market, including end-user perspectives. The Market Rule Project Team is finalising the terms of  reference for the EMAF, including the scope and mandate of the EMAF, membership selection criteria  and the code of conduct.