Energy & Petroleum Pack

Any person who constructs, operates, or converts a gas transmission or distribution pipeline, or a gas storage or liquefaction facility, must hold a licence from NERSA under the Gas Act. Licence types: (a) Construction licence — for new pipeline or facility construction; (b) Operation licence — for ongoing operation of gas infrastructure; (c) Conversion licence — for modifying existing infrastructure. Gas installations (appliances, piping, fittings) must comply with SANS 10087 and be installed by registered gas installers. All gas installations require a Certificate of Conformity (CoC) from a registered gas installer. Penalty: Operating without a licence — fine up to R5 million or imprisonment up to 5 years (s24 of Gas Act 48 of 2001). Reference: Gas Act 48 of 2001.

Any person who operates an electricity distribution system must hold a distribution licence from NERSA. This applies to municipalities with distribution infrastructure, industrial complexes distributing power to tenants, and mining operations distributing electricity to surrounding communities. The licence prescribes conditions relating to quality of supply, tariff methodology, network maintenance standards, and reporting obligations. Licensees must comply with the Grid Code (distribution network code). Penalty: Unlicensed distribution — fine up to R5 million or imprisonment up to 5 years (s46 of Act 4 of 2006). Reference: Electricity Regulation Act 4 of 2006, s7.

Any person who operates a generation facility with a capacity exceeding 1 MW must hold a generation licence issued by NERSA under the Electricity Regulation Act. The application must include: technical design specifications, environmental authorisation, grid connection agreement with Eskom or the municipality, financial capability assessment, and proof of land rights. NERSA registration (not a full licence) is required for facilities between 100 kW and 1 MW. Facilities under 100 kW are exempt but must notify the municipality. Processing time: 90-120 working days. Penalty: Operating without a licence — fine up to R5 million or imprisonment up to 5 years (s46 of Electricity Regulation Act 4 of 2006).

Any person who manufactures, wholesales, or retails petroleum products in South Africa must hold a licence issued by the Controller of Petroleum Products (DMRE). Licence categories: (a) Manufacturing — refineries and blending plants; (b) Wholesale — bulk storage and distribution (depots, tank farms); (c) Retail — service stations and direct sales. Applications must include: site plan, zoning certificate, environmental compliance, SABS fire safety certification, proof of financial capability, and BEE compliance certificate. Licences are site-specific and non-transferable. Penalty: Trading without a licence — fine up to R500,000 or imprisonment up to 10 years (s12 of Petroleum Products Act 120 of 1977). Reference: Petroleum Products Act 120 of 1977, as amended.

All electrical installations at energy facilities must be inspected and issued a Certificate of Compliance (CoC) by a registered person in terms of the Electrical Installation Regulations 2009 (GN R.242). Installations must comply with SANS 10142-1 (low voltage) and SANS 10142-2 (medium voltage). Requirements: (a) New installations — CoC before energising; (b) Alterations — new CoC for altered portions; (c) Change of ownership — valid CoC must be provided to new owner; (d) Periodic re-inspection recommended every 2 years for commercial/industrial premises. High-voltage installations (>1 kV) require additional compliance with SANS 10198 and must be maintained by qualified high-voltage practitioners. Penalty: Energising without CoC — fine or imprisonment under OHS Act. Reference: Electrical Installation Regulations GN R.242 of 2009, SANS 10142.

Energy projects (power plants, solar farms, wind farms, petroleum refineries, gas pipelines, substations) that trigger listed activities under the EIA Regulations 2014 require Environmental Authorisation from DFFE or the provincial authority. Common energy triggers: (a) GN R.327 (Listing Notice 1) — facilities for electricity generation >10 MW, fuel storage >80 m3, substations >275 kV; (b) GN R.325 (Listing Notice 2) — power lines >275 kV >1 km, nuclear installations, dams, refineries; (c) GN R.324 (Listing Notice 3) — clearance of natural vegetation >1 ha in identified geographical areas (relevant for solar/wind farms). Penalty: Commencing without EA — fine up to R10 million or imprisonment up to 10 years (s49A of NEMA). Reference: NEMA Act 107 of 1998, EIA Regulations 2014.

All electricity generators connected to the national or municipal grid must comply with the SA Grid Code as published by NERSA. The Grid Code comprises: (a) Network Code — technical standards for grid connection and operation; (b) System Operation Code — rules for system balancing and dispatch; (c) Metering Code — standards for revenue and check metering; (d) Renewable Power Plant (RPP) Code — specific requirements for wind and solar PV plants including power quality, reactive power, and fault ride-through capability. Non-compliance may trigger disconnection from the grid. Licensees must submit quarterly grid code compliance certificates. Reference: Electricity Regulation Act 4 of 2006, NERSA Grid Code.

Energy and petroleum facilities that store or process hazardous substances above the threshold quantities listed in Schedule 2 of the Major Hazard Installation Regulations 2001 (GN R.692 of 2001) must: (a) Register as a Major Hazard Installation with the local authority; (b) Conduct a quantitative risk assessment (QRA) reviewed every 5 years; (c) Prepare an on-site emergency plan tested annually through drills; (d) Submit a safety report to the local authority; (e) Notify the Chief Inspector of all major incidents within 48 hours. Common energy-sector MHI triggers: LPG storage >50 tonnes, petrol storage >200 tonnes, natural gas storage >50 tonnes, hydrogen storage >5 tonnes. Penalty: Operating an unregistered MHI — fine up to R100,000 or imprisonment up to 2 years (OHS Act s38). Reference: MHI Regulations GN R.692 of 2001, OHS Act 85 of 1993.

Solar PV installations (rooftop and ground-mounted) and small-scale embedded generation (SSEG) systems require municipal approval before connection to the grid. Requirements vary by municipality but typically include: (a) SSEG application form with system specifications; (b) Single-line diagram signed by a registered professional engineer; (c) Electrical Certificate of Compliance (CoC) for the installation; (d) Compliance with NRS 097-2-3 (grid interconnection standard); (e) Anti-islanding protection certification; (f) Building plan approval from the local authority for structural installations. Municipalities may limit the feed-in capacity and apply net metering or net billing tariffs. Systems above 1 MW require NERSA registration. Penalty: Connecting without approval — disconnection by the municipality, potential fine under municipal by-laws, and voiding of homeowner's insurance. Reference: Municipal SSEG by-laws, NRS 097-2-3, SANS 10142.

Facilities emitting greenhouse gases above the reporting threshold must submit annual emission reports to DFFE under the National Greenhouse Gas Emission Reporting Regulations (GN R.275 of 2017). The reporting threshold is: (a) 0.1 Mt CO2-equivalent for stationary fuel combustion; (b) Any quantity for fugitive emissions from coal mining, oil, and natural gas systems. Reports must follow the IPCC methodology and include: emission sources, calculation methodology, fuel consumption data, emission factors, and quality assurance procedures. Data must be submitted via the South African National Atmospheric Emissions Inventory System (NAEIS) by 31 March annually for the preceding calendar year. Penalty: Failure to report — fine up to R5 million or imprisonment up to 5 years (s51 of National Environmental Management: Air Quality Act 39 of 2004). Reference: NEM: Air Quality Act 39 of 2004, GHG Reporting Regs GN R.275 of 2017.

All NERSA electricity licence holders (generation, transmission, distribution, trading) must submit annual compliance reports to NERSA demonstrating adherence to licence conditions. The report must include: operational performance data, quality of supply statistics, financial statements, tariff compliance records, environmental compliance status, and grid code compliance evidence. Reports are due within 6 months of the licensee's financial year end. NERSA conducts regulatory audits to verify reported data. Penalty: Non-compliance with licence conditions may result in licence amendment, suspension, or revocation (s15 of Act 4 of 2006). Administrative penalties up to R1 million per contravention.

Any person who stores petroleum products in bulk (above the prescribed threshold of 200 litres for petrol or 2,500 litres for diesel) must obtain a storage certificate from DMRE. This applies to fuel depots, tank farms, mine fuel storage, and industrial fuel tanks. Requirements include: tank integrity certification (API 653 or equivalent), bund wall capacity (110% of largest tank), fire protection system (SANS 10089), leak detection system, spill response plan, and environmental compliance audit. Storage certificates must be renewed every 5 years or when tank modifications are made. Penalty: Storing petroleum without a certificate — fine up to R200,000 or imprisonment up to 5 years. Reference: Petroleum Products Act 120 of 1977, Petroleum Pipeline Act 60 of 2003.

All pressure equipment (boilers, pressure vessels, steam generators) used in energy and petroleum operations must comply with the Pressure Equipment Regulations 2009 (GN R.734 of 2009) under the OHS Act. Requirements: (a) Pressure equipment must be designed and manufactured to SANS 347 categories; (b) A registered person must inspect pressure equipment before first use and periodically (every 12 months for boilers, every 36 months for unfired pressure vessels); (c) An Approved Inspection Authority (AIA) must issue a Certificate of Compliance; (d) Repair or modification requires re-inspection and new CoC; (e) Operators of boilers >50 kW must hold a valid certificate of competency. Penalty: Operating uninspected pressure equipment — fine up to R50,000 or imprisonment up to 2 years (OHS Act s38). Reference: Pressure Equipment Regulations GN R.734 of 2009.

Entities conducting activities that result in greenhouse gas emissions above the threshold specified in Schedule 2 of the Carbon Tax Act must submit an annual carbon tax return to SARS and pay the carbon tax liability. The tax rate is R190 per tonne of CO2 equivalent (2026 rate, increasing annually). Allowances reduce the effective rate: (a) Basic tax-free allowance: 60%; (b) Trade exposure allowance: up to 10%; (c) Performance allowance: up to 5%; (d) Carbon budget allowance: up to 5%; (e) Offset allowance: 5-10%. The return is due by the last business day of July each year for the preceding tax period (1 January to 31 December). Emitters must also report to DFFE under the National Greenhouse Gas Emission Reporting Regulations. Penalty: Late submission — SARS standard penalties and interest under Tax Administration Act. Reference: Carbon Tax Act 15 of 2019, SARS.