Committee Report on Energy Budget

Meeting report

Portfolio Committee on Energy Draft Report on Budget Vote No 26 of the Department of Energy

The Committee Secretary, Mr Arico Kotze, presented the Draft Report to the Committee, reading it out in its entirety to allow Members to make inputs and recommendations.

The Draft Report set out the subject of the Report. It also provided an overview of the Department of Energy (DoE) and listed the entities that reported to the DoE. The organisational structure of the DoE, as well as its funded and unfunded posts, was elaborated upon. The Draft Report also elaborated upon the Strategic Plan and the Annual Performance Plan of the DoE.

Challenges in the energy sector were listed to include imbalances in electricity supply, timeframe problems and budget overruns with the Eskom Build Programme, transmission access and bottle necks and a need to improve oversight on electrification projects. Key focus areas for the 2016/17 financial year were also highlighted. These included plans by the DoE on its National Solar Water Heater Programme to install 38  875 units, to increase capacity on electricity generation by adding 1800 megawatts as well as to implement the procurement plan on the Nuclear Build Programme.

The Report then went on to note DoE’s insight on how the key focus areas for the financial year linked to the National Development Plan (NDP) and how this had been mentioned in the Annual Performance Plan (APP) for 2016/17. Details of the DoE Budget for 2016/17 were also elaborated upon, including the  in the financial budget allocations and baseline reductions.

Observations and findings which emanated from the Committee’s meeting of the 6 April 2016 were also included in the Draft Report. Some of these included that Eskom’s performance did impact and affect the performance of the DoE. The Minister of Energy, Ms Tina Joemat-Pettersson, had said that it was difficult to do oversight over an entity like Eskom that reported to the Department of Public Enterprises.  Minister Joemat-Pettersson had also stated that there were a number of issues that still needed to be addressed, such as the transmission and distribution lines as well as the functioning of the grid. She had pointed out that the DoE met regularly with the Department of Public Enterprises and Eskom.

Members had also raised a concern about the estimated R141 bn that had been allocated for expenses on certain projects and had subsequently been amended, relating to the Central Energy Fund. The DoE had furthermore appointed a procurement specialist with regard to the Nuclear Build Programme, to assist and advise during procurement processes. Funding for the outer years of the Nuclear Branch was still work in progress.  Another observation was that the end state of the electricity sector was not defined.

Finally Mr Kotze noted that this draft Report did not, as yet, set out any recommendations because these would be made by the Members.

Discussion

The Chairperson pointed out that the Draft Report was exactly what its name suggested – a draft. It was evident that the Draft Report needed some cleaning up and small errors needed fixing. He said that members were welcome to make comment on the substance of the Draft Report.

Noting that none of the Members ventured to make comments at the present point in time, the Chairperson then said that members could do so at the meeting on the following day. He said Members should feel free to take their time n coming up with inputs and recommendations on the Draft Report, and discussing these on the following day.

Mr M Mackay (DA) suggested that the Members could submit changes and recommendations on the Draft Report to the Committee Secretary so that it could be presented to the Committee the following day via projector on screen, for all members to see.

Mr M Dlamini (EFF) was not opposed to Mr Mackay’s suggestion. He suggested that the present meeting should be adjourned so that members could work on the Draft Report.

The Chairperson said that inputs by members should be forwarded to Mr Kotze by 20:00 that evening, and that Mr Kotze would then be able to incorporate the inputs made into the Draft Report. The Report would be presented back to the Committee on the following day.

Mr R Mavunda (ANC) agreed to the process regarding inputs made by members but said that the Draft Report would not be a new document but one that had changes made to it here and there.

Minute adopted

The Committee adopted Committee Minutes dated the 16 February 2016 unamended.

Committee Minutes dated 23 February 2016, 8 March 2016 and 6 April 2016 were also adopted, with minor amendments.

The meeting was adjourned.