Keetmanshoop thumbs nose at Govt, SELCo on power deal

THE Southern Electricity Service Company (SELCo) is seeking a High Court interdict against the Keetmanshoop Town Council after the Council terminated an exclusive 15-year contract the parties entered into in 2000.

The Namibian has it on good authority that the Town Council is adamant that it will stand by its decision to terminate the contract, despite pressure from the Electricity Control Board (ECB) to rescind it by noon today. It is believed that the ECB has the backing of Regional and Local Government Minister John Pandeni.There is speculation that the Council’s electricity licence might be suspended in terms of section 30(1) of the Electricity Act if it does not comply with the ECB’s instruction.In another blow for the Town Council, the Office of the Government Attorney is reported to have indicated that they would not be able to defend the Council when the High Court hears SELCo’s application on Wednesday.The Namibian has reliably learnt that Government attorneys cited a conflict of interest as the reason for their withdrawal: the other two respondents, the ECB and the line Ministry – which they have to represent in terms of the Government Attorney Proclamation – have different views on the matter to those of the Town Council.The Town Council is likely to seek the assistance of private legal practitioner Deon Obbes, since he is familiar with the SELCo saga.Obbes has previously worked in the Government Attorney’s office, which was involved in renegotiating the contentious SELCo contract on behalf of the Town Council, The Namibian was informed.The Namibian has also learnt that SELCo Managing Director Allan Van Zyl claimed in an affidavit in support of the court application that the Council did not have the resources to maintain the town’s power grid and to deal with emergencies.According to Van Zyl, SELCo faces substantial losses because of the termination of the contract and the losses would increase by the day.In his affidavit, Van Zyl claimed that the Town Council would not be able to compensate SELCo for the losses, since it was “bankrupt”.The Town Council would be unable to make ends meet without the monthly SELCo royalties of N$140 000 and a N$32 000 loan that is repayable at the end of the 15-year contract, Van Zyl stated in his affidavit.According to Van Zyl, relations between the Town Council and SELCo started to sour when the previous Council was replaced and the new Council refused to approve electricity tariff increases proposed by SELCo.That refusal cost SELCo N$118 000 in lost revenue, he said.Van Zyl also stated in his affidavit that his company makes a profit of N$1,8 million a month.It is believed that the ECB has the backing of Regional and Local Government Minister John Pandeni.There is speculation that the Council’s electricity licence might be suspended in terms of section 30(1) of the Electricity Act if it does not comply with the ECB’s instruction.In another blow for the Town Council, the Office of the Government Attorney is reported to have indicated that they would not be able to defend the Council when the High Court hears SELCo’s application on Wednesday.The Namibian has reliably learnt that Government attorneys cited a conflict of interest as the reason for their withdrawal: the other two respondents, the ECB and the line Ministry – which they have to represent in terms of the Government Attorney Proclamation – have different views on the matter to those of the Town Council.The Town Council is likely to seek the assistance of private legal practitioner Deon Obbes, since he is familiar with the SELCo saga.Obbes has previously worked in the Government Attorney’s office, which was involved in renegotiating the contentious SELCo contract on behalf of the Town Council, The Namibian was informed. The Namibian has also learnt that SELCo Managing Director Allan Van Zyl claimed in an affidavit in support of the court application that the Council did not have the resources to maintain the town’s power grid and to deal with emergencies.According to Van Zyl, SELCo faces substantial losses because of the termination of the contract and the losses would increase by the day.In his affidavit, Van Zyl claimed that the Town Council would not be able to compensate SELCo for the losses, since it was “bankrupt”.The Town Council would be unable to make ends meet without the monthly SELCo royalties of N$140 000 and a N$32 000 loan that is repayable at the end of the 15-year contract, Van Zyl stated in his affidavit.According to Van Zyl, relations between the Town Council and SELCo started to sour when the previous Council was replaced and the new Council refused to approve electricity tariff increases proposed by SELCo.That refusal cost SELCo N$118 000 in lost revenue, he said.Van Zyl also stated in his affidavit that his company makes a profit of N$1,8 million a month.