R3bn Dan City development in Tzaneen to build its own electricity substation

The R3 billion Dan City development in Tzaneen is taking shape, with plans underway for the project to build its own electricity substation, the Letaba Herald reported.

The plan emerged during a meeting between the Greater Tzaneen Municipality's political management team and executive committee, acting municipal manager Freedom Mthethwa, electrical director Bongi-Nkosi Sengwayo, the chief financial officer, and representatives of McCormick Property led by Dan City Mall project manager Ruan van Rensburg. The meeting was chaired by GTM Mayor Odas Ngobeni and sought a workable agreement on the costs associated with the proposed substation.

“We are building the substation on our own property and providing free infrastructure to the municipality, which will still sell electricity to the community. We want to understand how we can do all of that and still be required to pay a bulk contribution fee,” Van Rensburg said.

Mthethwa outlined the options available to the developer, including building its own substation or allowing the municipality to construct one, with different costs attached to each option. He said that even if McCormick opted for the municipality to build the substation, the developer would not necessarily benefit financially, as the contribution fee remains payable. “When we invest, we invest for the future,” he said, referring to the need to recover the R100 million borrowed from the Development Bank of Southern Africa.

The executive committee stressed the need for the municipality and developer to work swiftly together, saying the sooner the substation is completed and operational, the sooner construction of the mall can progress. Van Rensburg said between 1,500 and 1,800 people are expected to be employed during the construction phase, with about 2,500 jobs anticipated once the mall is operational.

The development is expected to include major retail outlets such as Boxer, Spar and Shoprite as well as major banks, and plans also include a filling station, residential development and a clinic. Van Rensburg said limited water availability remains a challenge, with the project relying on boreholes, which restricts how extensively it can expand. Ngobeni said he would escalate the water-supply challenge to the Mopani District Municipality.