ST FRANCIS BAY, EASTERN CAPE — The Kouga Local Municipality Battery Energy Storage System has officially launched, marking a historic first for a local government in South Africa. The pioneering initiative is designed to address the region’s surging power needs while significantly reducing the financial burden of peak-hour electricity tariffs.
Developed in response to the rapidly growing electricity demand in St Francis Bay and the broader Jeffreys Bay area—regions projected to see massive expansion through 2026 and 2027—the system tackles the repeated overdraw of the town’s Notified Maximum Demand (NMD) from Eskom. Currently, the municipality pays approximately R400 million annually to the national power utility.
Mayor Hattingh Bornman explained that the pilot project operates by charging the batteries during Eskom’s off-peak hours when electricity is cheaper, and discharging them into the grid during expensive peak periods.
“We are basically charging the battery during the off-peak times that Eskom charges us, and then during the peak hours when electricity is extremely expensive to us as a municipality, we use the battery to provide electricity to residents,” Mayor Bornman stated. He noted that this load-shifting strategy yields a saving of about R6 per unit during the winter months.
Theo Madatt, the municipality’s Director of Electromechanics, elaborated on the technical mechanics of the system. “We discharge this battery, which means we take the energy and push it into the grid during peak periods where the cost is very high, and we charge this battery during the off-peak period in the evening,” Madatt explained. He highlighted that the system effectively shifts the municipality’s high-cost energy consumption into low-cost time slots without altering the total amount of power used.
The battery, which services the reasonably small St Francis Bay and Cape St Frances area, was procured through a full tender process at a cost of just under R20 million, with the broader project valued at up to R24 million.
Regarding the return on investment, Mayor Bornman projected that the system could pay for itself in two years, while Madatt provided a more conservative estimate of four years, noting that savings will be most immense during the high-season winter months of July, August, and September. Once the initial costs are recovered, the municipality plans to reinvest the savings into purchasing additional batteries to expand the rollout.
The municipality previously cancelled a tender for a solar energy project, opting instead for the battery storage system because it offered a much quicker and more immediate way to save money. However, solar integration remains a key part of the long-term strategy. Following a three-month testing period for the current pilot, the municipality intends to roll out the system on a larger scale. Future phases will include charging the batteries with solar energy during the day and eventually taking municipal plants completely off the grid using a combination of solar and battery power.
This strategic infrastructure upgrade comes at a critical time for the Eastern Cape’s fastest-growing areas. The municipality is positioning itself to absorb the pressure of future developments, including a highly contested, potential 20-year nuclear plant project in the locality. Whether the nuclear plant proceeds or not, the new battery storage system ensures the municipality is better equipped to manage its resources, keep electricity affordable for residents, and maintain reliable service delivery in the years to come.
