Hansard: Debate on Vote 29: Energy (OAC)
House: National Assembly
Date of Meeting: 14 May 2013
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UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 41
START OF DAY
TUESDAY, 14 MAY 2013
PROCEEDINGS OF EXTENDED PUBLIC COMMITTEE – OLD ASSXEMBLY CHAMBER
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Members of the Extended Public Committee met in the Old Assembly Chamber at 14:00.
Mr G T Snell, as Chairperson, took the Chair and requested members to observe a moment of silence for prayers or meditation.
The TEMPORARY CHAIRPERSON (Mr G T Snell): Hon members, you may notice that the podium has now been set up in this venue, and members wishing to utilise the podium may speak from it. The Secretary will read the Order of the Day.
THE MINISTER OF ENERGY
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 41
START OF DAY
APPROPRIATION BILL
Debate on Vote No 29-Energy:
The MINISTER OF ENERGY: Hon Chairperson, Deputy Minister of Energy, Barbara Thomson, hon Chairperson and members of the Portfolio Committee on Energy, hon members, diplomats, director-general, senior management of the Department of Energy, chairpersons and chief executive officers, CEOs, of public entities, guests, stakeholders, and ladies and gentlemen, our first democratically elected President, Dr Nelson Mandela once said, and I quote:
For to be free is not merely to cast off one's chains, but to live in a way that respects and enhances the freedom of others.
It is an instructive remark, enjoining us all to work hard not only to cast off the chains, but to respect and enhance the freedom of others. It is therefore fitting that four years since President Jacob Zuma, through a stand-alone department, has assigned us the task to translate the ANC's policies on energy into implementable government programmes, we must reflect on the progress made and the road traversed thus far.
The ANC policy on energy is approached from the perspective of how energy resources can be effectively used to meet the national developmental goals,. It should also be implemented within an Intergrated Energy Plan, the IEP, balancing the goals of economic efficiency, environmental sustainability and social equity. The policy also aims at ensuring efficient use of energy and the substitution of more appropriate fuels.
Madiba further guided us when he said, and I quote: "Freedom alone is not enough without lights to read books at night."
The ANC mandated the Department of Energy to ensure the secure and sustainable provision of energy for socio-economic development. In essence, this enables us to enhance the freedom of others by making sure that the lights to read books by are always available to all the people of South Africa.
Tabling our Budget Vote in June 2009, we made various commitments on how we, as Team Energy, planned to transform the country's energy landscape to be the ANC-led government's vehicle for economic development and job creation.
I am pleased that today I can report on the progress we have we made so far.
Pursuant to the ANC's resolution of, and I quote, "ensuring security of supply of energy resources and pursuing an energy mix that includes clean and renewable sources", we delivered the country's first integrated energy mix plan for electricity, known as the Integrated Resource Plan, the IRP. It has a deliberate bias towards cleaner energy and it is in line with the long-term mitigation scenario, as espoused by President Jacob Zuma at the Conference of the Parties, Cop15 in 2009.
We created regulatory certainty in the energy sector, which is bearing fruit through significant investments in energy infrastructure. We have made significant inroads into making electricity accessible to all South Africans. We have achieved over a million household connections over the past four years, increasing access to over 84%, as per Census 2011. The Independent Systems and Market Operator Bill was approved by the Portfolio Committee on Energy and will soon be debated in the National Assembly. This will create the framework for the restructuring of the electricity supply industry and create the necessary space for the participation of the private sector in power generation.
Through the Renewable Energy Independent Power Programme, the IPP Programme, 47 bid companies were contracted to produce 2 450 megawatts of Mini, hydro, wind, photo-voltaic, PV, and concentrated solar projects, CSP.
To date, we have installed over 350 000 solar water geysers. And through the Green Economy Accord, we have ensured that the Solar Water Heating programme strictly enforces the inclusion of a minimum of 70% local content threshold in an effort to optimise the benefits of localisation and create the much needed jobs. We have continued to improve on the challenges experienced with the roll-out of Solar Water Heating programme. The biggest beneficiaries of the Solar Water Heating Programme are the women who are relieved of the chores of having to cook and heat water every morning.
We have promulgated the biofuels blending specifications and regulations, and are working within the government system to finalise the outstanding matters, and to facilitate the emergence of this industry with its promising job creation potential.
We set a course towards improving wages of retail and forecourt workers in the liquid fuel sector.
Through our persistence on issues of transformation in the energy sector, we witnessed the achievement of an unencumbered 25% black economic empowerment, BEE, stake in Total SA, through a consortium led by Calulo Investments of Mr Mkhuseli Faku. Calulo's stake in Total South Africa and its leadership within the consortium is an excellent example of the strides that are being made in ownership transformation in the local petroleum industry.
The Electricity Distribution Industry Holdings, the EDIH, has been closed down as per Cabinet's directive. Capacity is created in the Department of Energy to deal with the Approach to Distribution Asset Management, DAM.
The National Radioactive Waste Disposal Institute has been established and will be operationalised during
2013-14. Seed capital to this effect has been secured, and individuals are being recruited to the board of directors.
Honourable Members, you will recall that during the Conference of the Parties, Cop, 17, the development of the energy resources from the mighty Congo River, popularly known as Grand Ilnga, was identified as one of the legacy projects. To fulfill this aspiration, you will also recall that the President of the Republic, President Jacob Zuma, and the President of the Democratic Republic of the Congo, President Kabila, witnessed the signing of a memorandum of understanding that sought to pave the way for the development of this treaty. I am pleased to announce that we have finalised the treaty that will guide the development of this project, and it has paved the way for bringing clean energy to South Africa. [Applause.]
It was Amilcar Cabral who once implored humankind when he said, and I quote:
Hide nothing from the masses of our people. Tell no lies. Expose lies whenever they are told. Mask no difficulties, mistakes, failures and claim no easy victories.
It is therefore important that we admit that there are certain areas where progress has not been achieved as expected. One of these is energy efficiency. As a country, we have not been able to get together and resolve our energy demand side problems. Although we have initiatives such as the Eskom 49M initiative, the Energy Conservation Scheme, the Energy Efficiency Leadership Network, the distribution of compact fluorescent lamps, CFLs, and others, this is not enough, and we need to redouble efforts in this regard.
The Integrated Energy Plan, the IEP, was deferred for completion to 2013-2014, mainly to facilitate alignment to the National Development Plan, the NDP.
We are all aware of the negative developments within the national oil company, PetroSA. I wish to assure South Africa that I have taken these governance and procurement challenges seriously, which is why, late in 2012, upon the alleged transgressions coming to my attention, I instructed the Chairperson of the Central Energy Fund, the CEF, to initiate an investigation immediately, and I want to indicate that that investigation was done with immediate effect.
Hon members, we have received the report and are in the process of taking the investigation forward whilst implementing some of the recommendations made to clean up PetroSA. We need a credible national oil company. There will be no compromise on this particular issue.
Hon members, the report on the audit of refineries has revealed that our refineries are operating below nameplate capacity. This is an indication that investment by the private sector has not taken place to maintain maximum capacity, let alone improve capacity. This information has assisted us in improving the management of the liquid supply situation.
The audit also indicates the need for investment in the refinery sector, which is part of the response to the call by the NDP and the Liquid Fuels Infrastructure Road Map. The road map will be presented to this House in the second quarter of the 2013-14 financial year.
The capacity constraints in the refining sector and the pending tightening of fuel specifications under the Clean Fuels II programme, point to the need for the decisions to be made on the building of the new refinery.
The Liquid Fuels Infrastructure Road Map also indicates the need for additional refining capacity and the expansion of the petroleum products import, transportation and storage facilities. For the 2012-13 financial year, the Department of Energy was appropriated R 6,7 billion and has spent about 98,9% of the allocated budget.
The Integrated Energy Plan, a planning instrument to determine the most appropriate approach to meeting our energy needs up to 2050, is ready to be taken through a robust public stakeholder consultation process. This process will precede the consultation on the constituent parts of the IEP, including the Integrated Resource Plan, the IRP, and Liquid Fuels and Gas Infrastructure Plans.
Our target was to electrify 150 000 households, and we have achieved 175 474 connections, which is 25 474 above the target. [Applause.]
The Multi-Year Price Determination, the MYPD 3 was concluded in March this year, with the National Energy Regulator of South Africa, Nersa, allowing tariff increases of 8% per annum over the next five years. This provides certainty about electricity pricing and facilitates relatively longer term planning for much needed investment by municipalities, Eskom and the industry.
Projects that are indicated in the Integrated Resource Plan are expected to be largely funded from tariff increases. The Eskom Build programme and other Integrated Resource Plan programmes can now proceed to improve our energy security.
In line with the commitments made by President Zuma at Cop 15, our focus last year was on taking forward the clean energy initiatives. The positive outcome of our efforts in this area has been witnessed by more than R70 billion in investments in new generation capacity, with a total of about 2 450 megawatts of renewable energy capacity to come on stream from 2014. This amount megawatt of renewable energy capacity to come on stream from 201 form part of the eight initiatives of the Presidential Infrastructure Co-ordinating Commission, the PICC.
I am proud to say that today, amongst the G20 countries, we are now recognised as the 9th most attractive investment destination for the Green Economy. [Applause.]
Our renewable energy programme was voted by the Global Leadership Infrastructure Programme in New York as the best green energy infrastructure programme in the world for 2012. [Applause.]
In addition to this, we have also received two additional awards from the Africa Investor CEO Infrastructure Investment Summit, which was held recently in Cape Town, namely, the Infrastructure Regulator of the Year and the Power Deal of the Year Awards. I want to say that this actually puts paid to your skepticism about our noncommitment to renewable energy. [Applause.]
Clearly, honourable members, we are contributing to the collective effort to implement the National Climate Change Response Strategy, the Green Economy Accord and the NDP's move to less carbon intensive electricity production through the procurement of renewable energy sources.
Hon Chairperson, we pride ourselves on milestones scored. We acknowledged areas that need improvement. Going forward, allow me to point out some of the key initiatives.
For the 2013-14 financial year, the Department of Energy has been allocated a budget of about R6,5 billion, which is 2% less than last year's allocation. As much as 93% of the budget is earmarked for transfers to municipalities and state-owned entities, while 7% are to be utilised for operational and capital expenses.
Hon members, despite the success of installing over 5,6 million new electricity connections since 1994, Census 2011 shows us the glaring examples of areas with a serious lack of access to energy, such as Mbizana, Matatiele, uMsinga, uMhlabuyalingana, uMkhanyakude and many informal settlements in the Tshwane, Johannesburg and Ekurhuleni Metros, amongst others.
We remain committed to increasing access to modern energy in the fastest possible way. In support of the initiatives under the strategic integrated projects, SIPS, 6 and 8 of the PICC, we intend to publish the National Household Electrification Strategy, incorporating grid and offgrid solutions.
In the medium term, we will roll out a comprehensive energy solution in both informal and new housing developments, incorporating grid electricity, non-grid electricity, solar water heating and LP gas for formal dwellings. For informal settlements, this will involve LP gas for thermal needs, plus a PV-technology solution for lighting and small power requirements.
In the last four years, three integrated energy centres were constructed in Qunu, Mbizana and Ulundi. We have three sites in the pipeline to be completed during the course of 2013-14.
The Integrated National Electrification programme received an allocation of about R3,8 billion. Eskom and municipalities will receive R2,1 billion and R1,6 billion respectively, and we are confident of delivering 220 000 new connections in this budget cycle.
Electrification by political affiliation created islands of darkness in KwaZulu-Natal, and about 15 000 households were left unelectrified. To date 10 200 of these have since been electrified. [Applause.] The Premier of KwaZulu-Natal and the Treasurer-General of the ANC have confirmed that elimination of these so-called islands affirms that, working together, we will be able to improve the lives of all South Africans, irrespective of their political affiliation, because electricity doesn't have a membership card. [Applause.]
The challenges of lack of access to safe forms of energy lead to our communities using unsafe forms of heating, cooking and lighting. We will bring energy safety to the centre stage and enter into collaboration agreements with the Household Energy Safety Association. Members of this association are in the gallery, the LP Gas Safety Association, local government and the Department of Social Development. The CEF will play a leading role in this particular regard.
Hon Chairperson, the Integrated Resource Plan remains the blueprint of our future energy mix and electricity capacity requirements, and forms part of SIPs 8 and 9 of the PICC programmes. Various determinations to implement the technology programmes under the Integrated Resource Plan have been made and these include, amongst others, 2 600 megawatts gas to power, 2 200 megawatts coal and 800 megawatts cogeneration.
The procurement framework for these programmes will be completed this year to coincide with the third window of the Renewable Energy Independent Power Producer, the REIPP, programme.
We, as Team Energy, have decisively demonstrated that we are champions of the Green Economy and implementers of its accord.
Apart from the Renewable Energy Programme, we have more Green Economy programmes in the pipeline. This year we will prioritise the following. We will conclude negotiations with the sugar and timber industries to harness about 800 megawatts of power by capturing the value that is currently lost due to dumping biomass from these industries as waste. This is in line with the determination we made under the Electricity Regulation Act last year. Mpumalanga, Eastern Cape and KwaZulu-Natal, with their sugar cane and timber plantations, have been identified as the hub for this initiative.
We urge these industries to recognise the importance of using this programme to facilitate agrarian reform, and we expect them to empower communities that could form complementary supply chains through sugar cane farming, and ensure BEE partnerships as an integral part of their project companies. Remember, the ANC says we need to use everything available from waste, from cow dung to nuclear, to provide energy for the people of South Africa. [Applause.]
About 350 000 mostly low-pressure systems have to date been installed, with the overwhelming majority of the systems installed being imported in the Solar Water Heating programme. We have made the point that the continued importation of these systems is untenable, particularly if the systems are procured using public funds.
In line with the undertaking made last year, we have intervened to ensure that we create local jobs by enforcing that solar water heaters funded under the fiscal allocation have a minimum of 70% maximum local content.
We are aware of the quality problems afflicting some of the installed systems. We will soon be able to identify all the problematic installations from a central point, which will help to blacklist those service providers who do shoddy work. No one is going to install a solar water heating system in South Africa when he has done shoddy work in the previous job that he has done. [Applause.]
A new implementation model was developed and, is in the process of being implemented. The transition to the new contracting model will happen during 2013 to allow for new factories to be put in place. The verification of local content of the manufactured systems will be in accordance with the standard promulgated by the South African Bureau of Standards.
Financing of solar water heaters has until now been a challenge. In addressing the funding challenges, an additional R4,7 billion has been allocated to complete the installation of one million solar water geysers.
There will also be a larger focus on high pressure systems, since higher energy efficiency gains can be achieved by replacing electric geysers in the high electricity consumption market like that of members of this House. Members of Parliament must also start to lead by example and install solar water heaters at their residences. [Applause.] [Interjections.] We are not saying ANC members, but all Members of Parliament. [Interjections.]
With regard to electricity distribution infrastructure, we will work with Nersa to provide a tight framework for using tariffs for infrastructure rehabilitation or the Approach to Distribution Asset Management, ADAM, and the energy efficiency or standard offer initiatives. the ADAM project has been launched in line with Sips 6 and 10 of the PICC's National Infrastructure Plan. An initial amount of R320 million has been allocated for 2013-14 to pilot the ADAM projects in seven municipalities and two metros.
The roll-out of these pilots will be overseen by a steering committee that will assist the respective local government entities in the planning and implementation of these projects.
We believe this will be a solution to infrastructure maintenance problems, as we have witnessed the successful achievements by the department of the front-loading of municipalities with a severe backlog infrastructure for electrification projects, such as those in Mbizana, Matatiele and Thulamela, to name a few.
In addition, the success of working in a holistic manner as part of the Presidential Revitalisation Intervention within the King Sabata Dalindyebo Local Municipality, which is also an example of how electricity network challenges, will be addressed in the ADAM programme.
It is also envisaged that more local authorities will, in support of SIPS 6, 8 and 9, become involved in renewable energy generation initiatives through Waste to Energy and Rooftop PV systems. Such initiatives are already under consideration in various centres in Gauteng, such as the Johannesburg Metro and Mogale City.
In line with his commitment at Cop 15, President J G Zuma called on us, and I quote,
... to prove to ourselves and the world that renewable energy, especially solar, can be a baseload power generator.
After experiencing setbacks that delayed the solar park feasibility study, I am pleased to indicate that this is back on track. We will complete the feasibility study this year and then define the implementation scheme for the concept. In fact, it is exciting that the solar park corridor concept is taking shape with different areas along the corridor getting ready for implementation, for example, in Prieska in the Northern Cape, and this truly proves that the corridor approach does work.
Hon members, the Integrated Resource Plan also takes into consideration the retiring of the old baseload coal-fired power stations. The retirement of this baseload capacity is inevitable, and therefore its substitution is extremely time-sensitive. It is incorrect to assume that the replacement of this coal baseload source will be triggered by the demand projection alone.
Irrespective of the demand, it is anticipated that the supply of power through these old coal plants will fall away around 2023, and replacements are critical if we are to ensure our energy security.
Nuclear power carries tremendous benefits for South Africa in terms of the following, by being the lowest clean baseload levelised cost; broadening the energy mix; aligning with our beneficiation strategy; contributing to industrialisation and localisation; being central to the mitigation of carbon dioxide emissions; and, most importantly, leapfrogging South Africa into the knowledge economy as well as massive industrial development.
We also believe that the Youth Accord will be given expression through massive skills development and career opportunities in this programme.
The National Nuclear Energy Executive Co-ordination Committee, the NNEECC, was established, we all know, in line with the Nuclear Energy Policy of 2008, as the executive structure to lead, monitor and ensure oversight of the implementation of the policy.
The NNEECC approved a phased decision-making approach for implementing the nuclear programme and it has designated Eskom as the owner and operator of nuclear plants in South Africa in line with the nuclear policy.
We have set an international example after doing our own country assessment by conducting the International Atomic Energy International Nuclear Infrastructure Review, the IAEINIR, and we are the first country with operating nuclear power plants and reactors to conduct such a readiness assessment, because we believe in transparency.
The department has been allocated R710 million, including South African Nuclear Energy Corporation, Necsa, and the National Nuclear Regulator, the NNR, and its nuclear State Owned Companies to conduct amongst others, research and development; safety regulation; control of source and special material in terms of international obligations, and the development of nuclear policies and legislation to ensure the peaceful use of nuclear energy.
Over and above this, there is a stakeholder engagement process which we have already started in terms of ANC directives on transparency and openness, and the public's right to know. Our approach is informed by the need to demystify nuclear energy.
The department will continue working towards the roll-out of the nuclear programme, including reaching a final investment decision towards the procurement of nuclear power plants.
The Department of Energy participated, like you all know, in the Brazil, Russia, India, China and South Africa, Brics, Summit held in South Africa in March 2013. The summit noted the importance of energy co-operation and mandated the South African government, through the Department of Energy, to explore the possibility of forming an energy co-operation forum of the Brics member countries.
The co-operation will benefit from the complementary nature of the Brics member countries reflected in the characteristics of the energy sector and the resource potential of each country. It is our intention to meet with the Brics' Energy Ministers during this financial year to establish the terms of reference for the Energy Co-operation Forum to be considered at the next Brics Summit in Brazil, in 2014.
Our dialogue with partners will continue on the continent to help Africa to strategise on how best to raise, mobilise and administer funding to deliver energy access to those in need. The UN Secretary General's Sustainable Energy for All, SE4ALL, initiative demands of us to address the serious challenges of energy poverty.
We will continue to engage with our counterparts in the Southern African Developing Countries, SADC, to strengthen the Southern African Power Pool, SAPP. We will also continue to play a leading role in the organisations and on platforms such as the Clean Energy Ministerial, CEM, the International Renewable Energy Agency, the IREA, and the International Energy Forum, the IEF, the International Atomic Energy Agency, the IAEA, and the International Energy Agency, the IEA, as well as the Conference of Energy Ministers of Africa, Cema.
Hon Chairperson, the legislative programme this year involves the introduction of the Gas Amendment Bill, the Electricity Regulation Amendment Bill and the National Energy Regulator Amendment Bill.
Hon Chairperson, in conclusion, as the Department of Energy, we have managed to maintain exceptional financial standing, and achieved unqualified audits since our establishment for the past two years and plans are well under way to improve and achieve a clean audit. I Thank you. [Time Expired.] [Applause.].
Mr S J NJIKELANA
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 42
"Old Assembly Main",Unrevised Hansard,21 May 2013,"Take 42 [Old Assembly Main].doc"
"Old Assembly Main",Unrevised Hansard,14 May 2013,"[Take-42] [Old Assembly Main][90P-4-082A][mm].doc"
The MINISTER OF ENERGY
IsiXhosa
Mnu S J NJIKELANA: Sihlalo, hayi obekekileyo kuphela, kodwa nendimthandayo, Malungu ePalamente, Mphathiswa weSebe lezaMandla, neSekela lakhe nabo bonke abanye abaPhathiswa abakhoyo ...
English
...directors-general, the executive management of the Department of Energy, the state-owned entities and Team Energy as a whole...
IsiXhosa
...nditsho kuzo zonke iindwendwe zethu, ingakumbi kubafundi abasuka kwisikolo samabanga aphakamileyo iVista...
English:
I understand I have some guests from Vista High School. It is good to have the young ones learning how we handle things here in Parliament...
IsiXhosa:
... nani nonke baseMzantsi Afrika, ndihlanganisa oosomashishini, abasebenzi nabahlali, ndinibulisa ngezona zishushu xa ndinika inkxaso kwiVoti yoHlahlo-lwabiwo-mali yama-29 yeSebe lezaMandla.
English:
In my third budget speech in this august House, I wish to salute the celebrations of the 50th anniversary of the Organisation of African Unity, OAU, not only our government, but also the whole of Africa. However, we celebrate this 50th anniversary at a time when the spotlight is, amongst a host of global challenges, the risk of inadequacy of supply of energy to ever-increasing needs as well as the cost of appropriate technology.
The globalisation of energy demand, as Daniel Yergin claims, reflects the interesting patterns of consumption whereby, in the developed world, the average is 14 barrels per person and in the developing world it is only 3 barrels per person, a glaring disparity that warrants fundamental change not only in the socio-economic sphere, but also in the political system that creates the framework for energy industries.
Coming to the Southern African Development Community, SADC, region, we can confidently assert that our regional power pooling arrangement is currently the only formalised one in Africa. This is an attribute which reflects a high level of organisation that indicates great prospects for progressive development as well as a firm base for a formidable supply of energy in future, especially when taking into account the drive for regional integration on trade and industrialisation.
The department continues to participate in the Council for Energy Ministers of Africa, Cema, within the African Union and regional structures such as the power pooling system. The All Africa Energy Week in Addis Ababa last year noted that as Africa's increasingly strong economic performance continues, the continent needs to generate enough energy to power that development.
The Department of Energy has and is still expected to participate in various continental and global bodies such as Cema, as I have indicated, African Petroleum Producers' Association, APPA; India, Brazil, South Africa, IBSA; Council of Energy Ministers, CEM; the international energy body, the Atomic Energy Agency. Furthermore partnerships with countries such as Norway as well as participating in Brazil, Russia, India, China, South Africa, Brics, presents stronger prospects of tapping from those partners, particularly through their formidable resources.
Given the country's predicament of finding alternative sources of oil due to the unilateral imposition of sanctions against Iran, the department did a sterling job to ensure that such interruption is minimised.
IsiXhosa:
Masibaqhwabele izandla bantu bakuthi. [Kwaqhwatywa.] Ayilulanga laa nto bebeyenza aba bantu bakuthi. [Let us applaud them. [Applause.] What they did was not an easy job.]
English:
This a lesson worth remembering and preparing for in future, especially when there are claims that trade between Iran and USA in other areas is growing, whereas there is this artificial and unwarranted sanctions regarding oil.
In any case, Admiral Rickover once asserted that "high energy consumption has always been a prerequisite of political power." With regard to the impact of global politics on the oil trade, may I share what Elliot Abraham asserted. He said: "No other commodity has influenced global affairs as much as oil has. Till this day, oil still remains a major influence in international politics." He further stressed that "oil has influenced many countries' foreign relations in major ways".
How will our department benefit from the global energy trade, whilst at the same time contributing to it? Nevertheless, we need to acknowledge that the ANC-led government has steadfastly ensured resonance of, and compatibility between the energy trade and its foreign policy throughout. The government has ultimately expressed its position on the new Nuclear Build Programme and we are now clear about what the way forward is. The Minister has already articulated that.
We need to take note of the government's recognition of the growing demand for energy, or electricity supply in particular, and the commitment to address environmental challenges. The government is not only expected to roll out this programme, but also strongly to integrate the industrialisation and localisation strategy, appropriate information-sharing as well as the requisite training and skills development.
When the manufacture of heavy components in nuclear energy is integrated with the manufacture of light and medium-size components, a deeper level of localisation can be achieved, as we see articulated in the Industrial Policy Action Plan, Ipap. The development and measures that support the nuclear industry designation development, which will be followed by strategy and plan on localisation to support local industry development, has to be on the cards if not already developed.
The ANC definitely takes note of the department's commitment to establish the National Radioactive Waste Disposal Institute in the near future. This strengthens the confidence in ensuring responsible management of nuclear waste. The ANC is aware of a lot of differing views on the programme, but equally concerned about the dissension among individuals who are part of the collective, that is, government institutions whose positions are publicly known. Whilst we always have the right to dissent and differ, this should be exercised with the prudence it deserves. Furthermore the debate on costs as well as consideration of baseload power through nuclear energy is very much encouraged with our rider, in any case, of ensuring that such a discourse is based on facts and not propaganda.
At this stage, we await from the department, the energy efficiency strategy with great expectation given the vitality of energy efficiency against the growing demand of power, which at this stage is a challenge to meet. The few initiatives, such as the industrial energy efficiency project, driven by the National Cleaner Production Centre of South Africa, NCPC-SA, the Energy Efficiency Leadership Network, EELN, are examples of platforms of a formidable public awareness campaign to make energy efficiency an integral part of domestic, commercial and industrial activity whilst being mindful that working together is the only way we can achieve the much needed gains from energy efficiency.
Last year, we conducted studies and undertaken oversight tours and such tours were on energy efficiency and they focused on security of energy supply and quality assurance. At the Aurecon office building in N1 City, companies such as Saint Gobain, Creda Communications, Nampak, Hose Manufacturers, Kuyasa CDM project, the Traffic Centre, and the PetroSA Synthetic Fuels Research Centre at the University of the Western Cape, were visited here in Cape Town.
What we learnt during these visits about the importance of energy efficiency in our journey towards sustainable provision of energy was highly valuable and instructive. I must also express my highest gratitude to the Council for Scientific and Industrial Research, CSIR, for the role it played during these visits.
Every aspect of this good work, which only resonates with this call, are the directives from the Polokwane Resolutions of the 52nd conference of the ANC to ensure energy efficiency improvements in industry, in households and by setting vehicle efficiency standards as well.
However, it is also anticipated that the department would be allocating, as the very conference directed, significant additional resources for research and development of innovative, clean and low carbon technologies, including retrofitting of existing technologies.
In spite of such challenges, the ANC expresses its admiration of the efforts in promoting and advancing energy efficiency and the undying hope that the overall 12% target that was set in 2005 will be met or at least our performance will be quite close to that.
Let me also share the outcomes of public hearings we held on energy efficiency last year. I will just mention a few. It was considered that energy efficiency programmes have the potential to create jobs as well as playing a catalytic role for economic growth through local manufacture of energy efficient products, although that presents some challenges. Some municipalities incorporated energy efficiency into the normal institutional arrangements, a call which I make to the rest of the municipalities in our country.
The Department of Public Works is incorporating energy efficient techniques into all the new and renovated buildings, albeit slowly. I wish Comrade Thulas was around; he is not, so that he knows. [Laughter.] The EELN is the leading network in driving continuous improvement in energy efficiency, with members taking the lead by showing the best practice.
The Green Building Council was promoting energy efficiency as an easy and low-cost opportunity to save on energy consumption. We need to note that this council has offered to actively support our Parliament in its greening campaign. It is appropriate that we examine the extent to which the government's efforts have fulfilled the commitments related to energy, in so far as the 2009 manifesto is concerned, to ensure our consistency.
I'll just pick one example, that by 2009 the electrification programme had covered 80% of the country's households. We now stand, as the Minister has said, at more than 84%. Out of the current 18 strategic integrated projects, the Minister of Energy chairs one of them, the Integrated Municipal Infrastructure Project, cochairs two of them, one on green energy and electricity transmission and distribution, participates in 10 projects and has observer status in five projects.
Without any doubt, this expresses the daunting task and enormous load on the department's shoulders and this is a journey that also challenges this committee to monitor fairly closely such enormous work in the short, medium and long term. Recently this committee adopted the Independent Systems and Market Operator, ISMO Bill for consideration by the National Assembly. The core purpose of this Bill is wholesale electricity trading, including buying of power from independent power producers.
Further, it has to ensure systems are operating and contributing to planning of the new generation capacity. However, let us take a few steps back. In 2007 a master plan was worked out and this master plan took forward an energy White Paper whose aim was to ensure security of supply as one of the critical considerations of government. The master plan proposed interventions necessary to achieve adequacy, given projections about demand growth. Part of the master plan addresses the independent power producers as a matter that has a direct bearing on why the Independent Systems and Market Operator Bill was introduced.
The Independent Systems and Market Operator Bill was drafted in consultation with affected government departments and it was subjected to public participation by both the department and the committee. During these public consultation processes, the issue of independence of the transmission grid, amongst others, was raised. The response of the committee was to refer this matter for further scrutiny given its significance. Even now, I am making a plea to those sceptics to allow the government to explore various options of addressing the future of the transmission assets, through facts and not propaganda.
Furthermore, the committee is going to recommend to the Minister, through the National Assembly, the overall restructuring of the electricity sector as a whole, including addressing the dilemma of the transmission grid. This re-enforces the Cabinet decision to restructure the electricity industry as far back as April 2001. The introduction of this Bill signifies the need for intensifying operational efficiency in the electricity sector.
Let me thank the Department of Energy, the support of the committee and all those who have worked with the committee throughout the past financial year. The ANC supports Budget Vote No 29. [Time expired.] [Applause.]
Mr J F SMALLE / LN/Checked by Nobuntu/ END OF TAKE
"Old Assembly Main",Unrevised Hansard,18 May 2013,"Take 43 [Old Assembly Main].doc"
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 43
"Old Assembly Main",Unrevised Hansard,14 May 2013,"[Take-43] [Old Assembly Main][90P-4-082A][mm].doc"
Mr S J NJIKELANA
Mr J F SMALLE: Hon Chair, hon Minister, Deputy Minister, ladies and gentlemen, before I get into the technicalities of my speech, I would like to state, for the record, that the single most important challenge South Africa faces is energy security. Without sustained energy supply all the goals encapsulated in the National Development Plan will fail. Without energy security, we can forget about quality health services, education, economic growth and job creation.
At the post-Cabinet briefing on 2 May 2013, South Africans were assured that there would be no load shedding taking place across the country this winter. South Africans were left in the dark on exactly how this would be avoided. Just two weeks ago, parts of the West Rand experienced electricity blackouts. This does not inspire confidence.
Eskom claimed that it wouldn't be able to keep the lights on should it not be able to secure a 16% year-on-year electricity tariff increase from the National Energy Regulator of South Africa, Nersa. It is here that I would like to commend the DA for its submissions to Nersa which ultimately resulted in approval of only 8%. Once again it is the DA that placed the poor first.
The Medupi project is severely delayed. The only reason for this continuous and disastrous delay is the inability of Hitachi South Africa, of which the ANC, through its investment arm Chancellor House, is a major shareholder. It delays delivering on its contractual obligations.
But it is becoming increasingly obvious that the Department of Energy and its entities are more concerned with the laundering of taxpayers' money through vanity projects. We would not be surprised if the money intended to ensure energy security ends up in the coffers of the ANC and its interconnected patronage network of loyal and money-hungry cadres.
Hon Minister, the reason why I am making such accusations is entirely your fault. I have asked you many parliamentary questions about projects that PetroSA are pursuing. Your replies were just returning the obfuscating answers that this information is commercially sensitive. I have written to you on two occasions requesting a meeting to discuss these issues. You completely ignored these requests. Is it then a surprise that we read in the media of the billions of rands wasted through corrupt PetroSA activities?
In one instance, we are aware that PetroSA purchased crude oil for Eskom from India. We know that the tanker transporting this crude drifted off our coast for three months before offloading, incurring an additional daily fee of $25 000 per day. That is $2,250 000 of wasted taxpayers' money. But your reply was that this information is commercially sensitive. It is extremely embarrassing that PetroSA can waste money like this. How can information on the expenditure of taxpayers' money in a severely regulated and government-created and supported energy monopoly be commercially sensitive?
The DA welcomes the investigation into PetroSA by the Hawks and the
Public Protector. The Department of Energy and its entities have for too long evaded accountability. The lame excuse that Mr Kaizer Nyatsumba, the head of corporate affairs and shared services, gave following the Oilgate 2 scandal was:
In this business swift decision-making is required in order to prevent the loss of profitable opportunities.
I have two questions: Profitable opportunities for whom and when last did PetroSA secure a profitable opportunity for South Africa?
It is vital that we review South Africa's 20-year energy plan. The DA does not believe that South Africa needs a nuclear build to complement its energy mix. In fact, the programme could cost the taxpayers up to R1 trillion. A project of this magnitude is completely unaffordable. We are certain that corruption through the nuclear build would dwarf that of the arms deal.
Anton Eberhard of The National Planning Commission, NPC, argued against the Nuclear Build programme, only for the Deputy Director- General of the Department of Energy to come out strongly here in Parliament, stating that the Nuclear Build programme is non-negotiable.
Instead of pursuing a nuclear build programme, what we should do in order to secure energy security in South Africa is to increase our gas footprint. We must increase our capacity to import liquefied natural gas, LNG. We need an LNG import terminal that would cater for the offload and storage of gas. We must be more proactive in negotiating access to gas deposits in Mozambique and Tanzania.
The total gas reserves, as audited in March 2012, stood at about 770 billion standard cubic feet. The total contingent gas resources are at 1 020 billion standard cubic feet. These gas basins are on our own doorstep. Block 9 of the Bredasdorp and the Mozambique basins are estimated at 50 trillion cubic feet, not to mention that Namibia has an estimated crude oil reserve of 11 billion barrels. Where is PetroSA in accessing these deposits? Instead, PetroSa is wasting billions in places like Egypt, Equatorial Guinea, Ghana and Nigeria.
We have, however, made great progress in building up our emerging renewable energy sector. It is encouraging to see the Pew Charitable Trust recognising us as a world leader within the green energy sector. We still have a long way to go, though, Minister. If this programme is to be financially sustainable in the long term, we have to draw on the commitments of developed countries to help finance the costs of renewable energy in line with their international climate change commitments.
In this regard, the DA is alarmed that the department has still not made any progress on implementing the South Asia Regional Initiative, Sari, despite signing the memorandum of understanding, MOU, to great fanfare at Cop 17. We need to urgently access the billions of rands set aside by those progressive European countries otherwise they will simply be shifted to countries that show a greater willingness to utilise these funds effectively.
The role of the state should be to create an environment that will allow the private sector to play a greater role within the energy sector. Government cannot be the referee and the player at the same time. On the one hand, government controls the application of licenses and the regulation of the sector, and on the other it wants to compete within the same sector. Do you at present have the expertise to manage such a portfolio?
We cannot even think of building the state refinery, Mtombo, when other refineries are running at capacities of around 70%. South Africa uses 500 000 barrels per day of crude oil and 195 000 barrels per day of coal to liquid synthetic fuel. As long as South Africa is importing refined product, the marginal cost of liquid fuels will be set by what it costs to import it. We must create a situation where local demand is greater than the refining capacity or create new markets outside the borders of South Africa.
PetroSA's inability of being transparent before the portfolio committee on their downstream attentions in trying to acquire Engen's downstream portfolio raises questions on their intentions and the functions of government and its capacities.
There is a need to commission and license all 39 tanks at Milnerton to come online and once again become economically viable. We have to operate our storage capacities to its full potential as well as reposition small form factor for the next three decades. Free up the tanks that store the strategic stock at Saldanha Bay and transfer the function of storing to Milnerton to increase the balance of SFF. Start hedging our strategic stockpiles with strategic partners of course, with certain guarantees in place. By doing so, we will increase the economic viability of SFF. Diversify the Milnerton tanks to hold not only crude oil, but also refined products. Change some of the volume tanks to store bitumen.
Hon Minister, with specific attention to bitumen, you said in a parliamentary reply that bitumen does not fall within your mandate. But bitumen is a direct product from this industry. We will, once again, face a shortfall of bitumen of 20%. South African refineries produce nearly 79 million kg of bitumen annually. With a 20% shortfall, we need to import bitumen and this carries a R1 500 per ton premium on imported bitumen placing an additional burden on the state and companies by inflating construction costs unnecessarily. Bitumen storage is a problem and, hon Minister, it is your problem. [Laughter.] [Interjections.]
In conclusion, hon Minister, your department and the entities that you are politically responsible for do not inspire confidence. Within your department and its entities there is widespread corruption, there is no transparency and accountability, and wasteful expenditure is rampant.
Hon Minister, you have no idea how to manage your portfolio, not to mention that you do not understand, or refuse to understand, how the energy sector works. I thank you. [Interjections.] [Applause.]
Ms S R BEREND / /Arnold / GC / END OF TAKE
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 44
Mr J F SMALLE
The TEMPORARY CHAIRPERSON (Mr G T Snell): I now call on hon Berend. I would like to bring to the Committee's attention that it is the hon member's maiden speech. [Applause.]
Ms S R BEREND: Chairperson, hon Minister, Deputy Minister, members and guests in the gallery, this is my maiden speech in this House today. I speak on behalf of hon Ferguson, who is unfortunately not well due to the 'flu.
Minister, with the signing off of the preferred bidders for the independent power producers, I want to thank you for speaking out so passionately about the inclusion of women. It was heartening to note that your report states "not on my watch". It is an exciting project for economic growth and certainly job creation; yet, it would be remiss of me not to mention that R3,9 billion is appropriated to the Integrated National Electrification Programme management and, as such, the security of energy supply. The expansion of this electrification programme is being implemented by Eskom and local government.
If the department is allocating this much money it needs to clearly articulate how it will support local government. How will it expect accountability and, ultimately, the delivery? We cannot shy away from the notion that the service delivery protests across the country are precisely the result of the inefficiency of local government in performing its tasks. Cope would like to have a breakdown of the R11,1 billion spent on infrastructure to electrify 475 157 households between 2009 and 2010 and the 2012-13 financial years. Were these newly built homes or existing homes? Are the informal settlements included in this total? If the answer is yes on the electrification of informal settlements, then why is the community of Kliptown up in arms and risking their lives by stealing electricity?
Afrikaans:
Hoekom hang die elektrifisering van hierdie gemeenskap af van die beskikbaarheid van fondse terwyl die departement wel fondse toegeken het vir elektrifisering? Kliptown is nie 'n nuwe – en nog minder 'n onbekende – gebied nie. Of is dit dat die ewig stygende elektrisiteitstariewe al vinniger onbekostigbaar word vir miljoene arm huisgesinne regoor Suid-Afrika? Dieselfde vrae moet oor die 2013-14 ... [Tussenwerpsels.]
English:
The TEMPORARY CHAIRPERSON (Mr G T Snell): Hon member, please hold on. Hon members, please give the member the respect that she deserves for her maiden speech. Thank you. [Interjections.]
Afrikaans:
Me S R BEREND: Dieselfde vrae moet oor die 2013 toekenning van R3,5 miljard om 200 000 huishoudings te elektrifiseer beantwoord word. Wat is ingesluit as R17 500 spandeer word om een huishouding te elektrifiseer?
English:
Chairperson, according to Census 2011, 85% of households use electricity for lighting. Yet, every year, the main reasons behind fires in informal settlements are the direct result of not electricity, but of the use of paraffin and open fires for cooking food and heating of dwellings. Every year lives, livelihoods and belongings are lost to runaway fires. These are communities that were promised a better life.
Just over the past weekend, there were six incidents of fires in informal settlements in this city alone. One man was reported dead, and many more families were displaced. Minister, is this not a contradiction? We cannot continue in this vein. We need people who are better qualified to lead and deliver on all our projects for our people.
Afrikaans:
Ons voel gelukkig en is dankbaar oor die windplaas in Prieska in die Noord-Kaap, waar beide die Minister en die uwe vandaankom. Die mense van die Noord-Kaap wens dat mense van alle partye in die Noord-Kaap by die werkskeppingsgeleentheid sal baatvind.
English:
The department must provide its five-year plan for all the departments that fall under it as well as the entities it supports, its goals and how and where the department sees the identified entities in five years.
In his state of the nation address, President Zuma promised the people that his administration would work smarter, faster and better to alleviate poverty. [Interjections.] In 2008, Eskom's lack of capacity led to load shedding, which had huge repercussions for the country's economy. The subsequent stoppages affected the mining sector and pushed gross domestic product growth below 4% in the same year. This was one of the reasons that there was very little job creation or growth. Again, in 2013, the country's gloomy economic growth and job creation will be hit by the rumoured load shedding. How will this alleviate or contribute to the status of job creation or poverty?
Minister, whilst the Department of Energy says it will promote energy efficiency and conservation through the expansion of the Solar Water Heating programme, surely, we should be looking at solar energy as a whole and not confining ourselves to solar water geysers. Cope asks that for the creation of sustainable jobs, we should learn from the United States, where more people are employed as solar workers than as coal miners. Solar energy has contributed to huge job growth. In South Africa, coal has become the number one priority to produce 90% of electricity for domestic use. This is not good news. Doing anything more with coal would put the country on a collision course with its Copenhagen Accord climate change pledges. [Interjections.] Minister, we should be looking more holistically at solar energy.
Furthermore, lack of capacity has also cost South Africa millions of rands and tens of thousands of jobs in the biofuels industry. Seven years after a government feasibility study showed that biofuels have the potential to create tens of thousands of new jobs, the paperwork needed to establish it remains outstanding. Incentives have proven not to be sufficient to lure investments to the biofuels sector. The department has doubled its spending on consultants to R61,2 million just for research on nuclear build. This happens against the backdrop of sending 60 employees to France for training, only to come back and be retrenched. Was this not deemed wasteful? It does not make economic sense to reduce spending on noncore goods and services and to misuse millions on consultants who have no structure to hand over the functions to after they have completed the research.
In 2011, the Minister announced that a nuclear tender proposal was submitted to Cabinet in September of that year. Are there problems facing the department in delaying the advertisement of the tender, or are there issues that we might not know of?
In conclusion, I would like to thank the chairperson of the portfolio committee for being consistent. [Interjections.] [Time expired.]
Mr J H VAN DER MERWE
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Takes: 44 & 45
Ms S BEREND
Mr J H VAN DER MERWE: Chairperson, we have listened to a maiden speech, and I want to point out to the hon member that it is customary to congratulate a member on a maiden speech. May I also point out that it is customary to, when you make a maiden speech, not make controversial remarks, like you have done. [Applause.] I think ... [Interjections.]
Mr D A KGANARE: Chairperson, on a point of order ...
The TEMPORARY CHAIRPERSON (Mr G T Snell): What is your point of order, hon member? Excuse me?
Mr D A KGANARE: Chair, from the beginning, hon Berend made it clear that she was reading a speech on behalf of hon Ferguson. It was not really her speech.
The TEMPORARY CHAIRPERSON (Mr G T Snell): Hon member, that is not a point of order. Thank you. Continue, hon Van der Merwe.
The ACTING DEPUTY CHIEF WHIP OF THE MAJORITY PARTY: Chairperson, on a point of order. Just to highlight therefore ... [Interjections.]
The TEMPORARY CHAIRPERSON (Mr G T Snell): Hon members, please, I cannot hear the hon member speaking.
The ACTING DEPUTY CHIEF WHIP OF THE MAJORITY PARTY: Chair, I think what we need from the member is to correct herself, because she has misled the House, and the Rules are very clear. If she was reading someone else's speech, it is incorrect for her to say to the House that it is a maiden speech, because it is not her speech.
The TEMPORARY CHAIRPERSON (Mr G T Snell): Hon members, it was her maiden speech. If she wanted to deliver it on somebody else's behalf, that is her loss. Continue, hon Van der Merwe.
Mr J H VAN DER MERWE: Chairperson, I wish to pay tribute to my colleague Mr Eric Lucas, who has resigned from Parliament but who served in this committee for a long time. I thank him for his ... I hear the Minister saying she misses him. [Applause.] We also miss him.
I wish to address the very serious electricity challenge that consumers face because some municipalities do not pay Eskom. This leads to threats from Eskom to cut the electricity supply to municipalities, as happened recently in Klerksdorp, when Eskom threatened to cut the town's electricity. Why? It is because the Klerksdorp Municipality was in arrears with Eskom by approximately R100 million, which was intended for Eskom but which the municipality had used. The urgent question I therefore wish to address is why municipalities use the money paid to them by consumers, whilst part of the money should go to Eskom.
As an example, consider a consumer who gets an account from the municipality for R1 000 for electricity usage. Part of that R1 000 should be paid by the municipality to Eskom, but they don't. The point I wish to emphasise is that it is in the interest of all electricity consumers in our country – all of us here – that municipalities should not be allowed to use the money which is earmarked for payment to Eskom.
Let me quote another example. If a client approaches an attorney to handle a case for him, the attorney will phone an advocate and get some quotes and say it might cost the client R100 000. The attorney's fee will be R30 000, but R70 000 must be kept in trust to pay the advocate. Now, what is important is that the attorney is not allowed to use the R70 000 which is in trust for the advocate. I suggest that the same should apply in respect of payment to Eskom. When consumers pay their electricity bill, Eskom's portion should be put in trust for payment to Eskom. The municipality should not use the money for other purposes, because it is held in trust for Eskom. This practice should protect consumers against being without electricity because municipalities had used Eskom's money for other purposes.
In addition, still on the same subject, I should like from the hon Minister to know how many municipalities are currently in arrears with payment to Eskom. Secondly, how much are these arrears? Eskom obviously has this information, and I submit that it is in the public interest for the public to know that. I should also like to know why Eskom does not take early steps to recover arrears from municipalities. Why are matters allowed to develop to an advanced stage where threats are then made to cut the electricity? Why not sue the municipalities at an early stage?
In conclusion, I wish the department and the Ministry well for the coming year. The IFP supports the budget. I thank you. [Applause.]
The HOUSE CHAIRPERSON (Mr M B Skosana) /Mia END OF TAKE
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 45
"Old Assembly Main",Unrevised Hansard,18 May 2013,"Take 45 [Old Assembly Main].doc"
"Old Assembly Main",Unrevised Hansard,14 May 2013,"[Take-45] [Old Assembly Main][90P-4-082A][mm].doc"
Mr J H VAN DER MERWE
Mr G J SELAU: Hon Chairperson, hon Minister, hon Deputy Minister, hon members both from the left and the right, distinguished guests, ladies and gentlemen, I dedicate this speech to all our comrades throughout South Africa and beyond. If time allows, I will come back to the opposition. [Laughter.] It is once more a great moment for me to address this House, before you, Chairperson, on the developmental issues of energy in our country - South Africa - including how and why we relate to other countries on our continent.
Allow me to start by saying that the ANC supports Budget Vote 29 of the Department of Energy 2013-14. [Applause.] Let me also take this opportunity to congratulate the Department of Energy on a job well done in the area of the electrification of South Africa. According to Statistics SA's Census 2011 report - which everybody in South Africa is supposed to have, particularly Members of Parliament - 85% of households had access to electricity for lighting. The President of the Republic of South Africa, His Excellency honourable J G Zuma, in his state of the nation address 2013, also alluded to this. What a remarkable achievement. [Applause.]
With your permission, hon Chairperson, in the beginning let me focus on clean energy. Last year, I used this opportunity to define climate change and describe its negative impact on society as a whole if not addressed. This year, if time allows me, I wish to give the constituency of South Africa some information about what the ANC-led government did in this regard.
Through the Department of Energy, government took major steps to formulate and implement measures to adjust to and mitigate climate change. The country is committed to reducing the baseline emissions to below 34% by the year 2020 and to 42% by 2025. This commitment requires the design of a more sustainable development path, thus the national climate change response White Paper was published in 2011. Its aim is to, firstly, effectively manage the inevitable climate change impact through interventions that build and sustain South Africa's social, economic and environmental resilience as well as emergency response capacity.
Secondly, it aims to make a fair contribution to the global effort to stabilise the greenhouse gas concentration in the atmosphere at a level that avoids dangerous human-induced interference with the climate system within the timeframe that enables economic, social and environmental development to proceed in a sustainable manner.
The Department of Energy, in pursuit of a low carbon development path and in response to the White Paper, has embarked on the following projects, which the Minister has alluded to, namely the solar water heaters roll-out; the renewable energy independent power producers procurement programme; and the solar park in the Northern Cape. But I want to talk about that a little.
There are two questions that come to mind. The first one is, what is a solar park? The second one is, what is its significance? The solar park is a concentrated zone of solar plants that are built in a cluster, sharing common transmission infrastructure. This multibillion rand park, earmarked for the Northern Cape, will be built over thousands of hectares and provide over 5 000 megawatts - or five gigawatts - of electricity, which will be fed into the national grid. It will be built in stages over a period of nine years and it has benefits such as massive job creation; lucrative private sector investments; local industry development; and cleaner and more secure power supply among other benefits of a large-scale park like this. The project is a partnership between government, the state-owned utility Eskom and the Clinton climate change initiative.
However, the success of government's management and sustainability of energy security of supply cannot be seen with the eye on electricity only. Petroleum and gas supply management need attention too, therefore there is a need for energy planning in an integrated manner. This says that I must talk about the integrated energy plan which the Minister referred to.
An integrated energy plan is not a precise blueprint for the energy sector, but a framework within which specific energy development decisions can be taken. The Department of Energy is about to table a draft report, the integrated energy plan, to Cabinet and thereafter release it to the public, and later refer it back to Cabinet for adoption prior to being referred to Parliament. This process is unfolding.
Linked to that plan there is the integrated resource plan, which the Minister also spoke about. While the Minister was speaking, there was a moment where I asked myself, what is it that I will say during my turn as the Minister has said all I would say. [Laughter.]
Listen, the integrated resource plan, which is the electricity section of the integrated energy plan, was promulgated in May 2012 and outlines the required generation capacity for the period up to 2030. We think in the long term. This is work in progress and must be supported.
In order to succeed with this plan and with development around clean energy, you need research and development. One of the most important scientific institutes is now attached to the Department of Energy's state-owned enterprises, SOE, the Central Energy Fund. The South African National Energy Development Institute is a research and development organisation meant to take the Department of Energy to great heights. It is currently involved in a technology development project, working together with the Council for Scientific and Industrial Research, CSIR, the University of Pretoria and other relevant players. It also conducts research in the carbon capture and storage projects, working together with the South African Centre for Carbon Capture and Storage and various other responsible parties, including Sasol, the Norwegian Embassy and Eskom. The working for Energy project is another area on which the South African National Energy Development Institute, Sanedi, focuses and it includes energy efficient building materials, low-income housing renewable energy, etc. Have you ever heard about them? These are areas that are being researched and are still to come in our lives.
Other Sanedi research and development projects include smart grid, green transport, renewable energy and energy efficiency. Working together with the relevant departments and stakeholders, they are looking forward to succeeding.
However, hon Smalle, we are fully appreciative of the challenges PetroSA faces, but we refuse to accept that they constitute a crisis [Interjections.] We support the Minister in her endeavours to resolve these challenges and wish her every success. In my view these issues were supposed to have been left to them to handle before we come in.
Regarding the participation of PetroSA in international activities, it is very surprising to me that this matter only comes as a concern now. [Interjections.] Listen carefully, this company has been active in international activities for a very long time. To remind those who have forgotten, the 1994 elections meant that we are fully part of the universe and we should therefore participate in continental and world economic activities.
In conclusion, I want to quote the chairperson of the Portfolio Committee on Energy when he responded to an article by a certain Mr Donwald Pressly in Business Report on 2 May... [Time expired.] [Applause.]
Mr L W GREYLING
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 45
Mr G J SELAU
Mr L W GREYLING: Hon Minister, in the short time available to me I will concentrate on just two issues, namely, resolving our short-term energy crisis and ensuring that our long-term planning represents the best mix of investments for our country.
It is clear that this government has failed woefully in its primary duty of ensuring energy security. The delays in bringing online Medupi and Kusile Power Stations and the massive cost overruns on both these projects have pointed to the need for the government to finally break the monopoly stranglehold that Eskom enjoys over energy generation. [Applause.]
We now need to involve all South Africans in finding solutions to what is essentially a government-induced crisis. [Interjections.]
The HOUSE CHAIRPERSON (Mr A Mlangeni): Order, please. Hon members on my right, please allow the member to finish his speech. Both sides of the House, stop hackling. I won't allow it. Please, go ahead.
Mr L W GREYLING: Thank you. I hope you'll give me extra time. I know that my words do create this kind of ... [Laughter.] [Interjections.]
We must develop a comprehensive household energy strategy that can incentivise households to reduce their peak demand usage. This would entail the roll-out of smart meters that incorporate time-of-use tariffs; rigid enforcement of the regulation regarding solar water heaters; and financing schemes to reduce their upfront capital cost.
A proper gas strategy that can see households migrating from electric and paraffin stoves to gas-fired ones also needs to be implemented.
We must also ensure that all spare generating capacity is utilised and companies that are able to build cogeneration plants must be properly incentivised to do so. Keeping the lights on is going to be a difficult task. But as the ID and the DA, we are prepared to assist as much as possible and we have already implemented what measures we can in the Western Cape and the municipalities that we control to achieve this aim.
In terms of long-term planning though, it is patently obvious to everyone except this department that our 20-year energy plan needs to be urgently reviewed and revised. The department and, it seems, Cabinet has preposterously already deemed the 9 600 megawatt nuclear programme to be non-negotiable.
Minister, this is what should be deemed non-negotiable. Firstly, in line with the National Development Plan, a proper study into the economic feasibility of this programme needs to be undertaken in a transparent manner. The public needs to be made aware of what a programme like this will cost, and the impact that it will have on future energy prices. Already Eskom has conservatively stated that it would need increases of 20% year-on-year to pay for such a programme. Secondly, the outdated assumptions in the integrated resource plan, IRP, need to be reviewed - this year - and a new plan needs to be modelled on these revised assumptions before any major investment decisions are entered into.
The ID will not allow this government to lock South Africa into a costly nuclear programme without first ascertaining whether we can truly afford it and whether the long-term demand projections actually require it. Minister, the fight has just begun. I thank you. [Applause.]
Adv A de W ALBERTS
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 46
"Old Assembly Main",Unrevised Hansard,20 Jul 2013,"Take 46 [Old Assembly Main].doc"
"Old Assembly Main",Unrevised Hansard,14 May 2013,"[Take-46] [Old Assembly Main][90P-4-082A][mm].doc"
Mr L W GREYLING
Afrikaans:
Adv A D ALBERTS: Voorsitter, verlede jaar het die VF Plus onder die Minister se aandag gebring dat Suid-Afrika 'n energiekrisis in die gesig staar. Vandag is dit nog steeds die geval met, onder andere, Eskom wat gereeld vir die gebruiker vra om asseblief nie so baie krag te gebruik nie. Dit maak vir Eskom seker een van die enigste maatskappye in die wêreld wat vir hul kliente vra om minder van hul eie produkte te koop.
Eskom kan natuurlik argumenteer dat dit nie 'n gewone kommersiële firma is nie. Natuurlik sou die argument korrek wees, want Eskom is inderdaad 'n nutsmaatskappy. Dit los ons egter met meer vrae as antwoorde, want Eskom is dit eens dat hy wel winste mag maak en hom gedra soos 'n gewone maatskappy.
Dit is egter in die openbare belang dat agb Minister Peters met die Minister van Openbare Ondernemings skakel om te verseker dat Eskom nie vir sy eie sak optree nie, maar wel in die openbare belang van Suid-Afrika se inwoners.
English:
We also need to look at the Integrated Resource Plan, IRP, 2010. Much has changed since its inception. It is of great concern that its proposed nuclear build programme, as part of the 20-year energy plan, is being questioned by the National Planning Commission, NPC. I am sure that the Minister has read the University of Cape Town's Energy Research Centre's study commissioned by the NPC, which explains that a nuclear build programme is not necessary for the next 15 to 25 years. The study indicates that the IRP 2010 makes incorrect future demand projections and is underestimating the costs of the nuclear build project. Once again one gets the impression that the government wishes to embark on a public expenditure programme for the pure sake of it to ensure access to state funds, as was the case with the redundant e-toll system in Gauteng.
Therefore, we wish to know whether the Minister is going to engage with the NPC regarding the necessity of the nuclear build programme. Will the Minister ensure that the IRP 2010 is renewed before any decisions are made on nuclear energy?
Afrikaans:
Sover dit die koste van die kernkragprogram aangaan, is sommige kommentators bekommerd dat die uitgawe die Tesourie kan knak. Gegewe ander eise op die staat, soos die R85 miljard pensioenaris-eis teen Transnet ... [Interjections.]
The HOUSE CHAIRPERSON (Mr M B Skosana): Order please! Hon member, I will not allow you to heckle. If you do it once more, we will drive you out of this House! [Interjections.] [Applause.] [Laughter.]
Afrikaans:
Adv A D ALBERTS: ... kan die staat in die toekoms wel groot moeilikheid te wagte wees en moet openbare besteding versigtig, en net as werklik noodsaaklik, gedoen word.
English:
We again need to interrogate the matter of fracking. Of concern is that government seems to be approaching fracking on a trial-by-error basis. The problem is of course that once an environmental mistake has taken place, it cannot readily, if ever, be turned around. Let's learn from other examples and stay away from this energy source and invest more in alternative energy, which, given Eskom's pricing and successful mileposts achieved by government in this regard, has now become more affordable. In essence, let's review the IRP 2010 and bring it in line with today's realities. Thank you.
The DEPUTY MINISTER OF ENERGY
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 47
"Old Assembly Main",Unrevised Hansard,29 May 2013,"Take 47 [Old Assembly Main].doc"
"Old Assembly Main",Unrevised Hansard,14 May 2013,"[Take-47] [Old Assembly Main][90P-4-082A][mm].doc"
Adv A de W ALBERTS
The DEPUTY MINISTER OF ENERGY: Sihlalo, Chairperson, hon Minister Ms Dipuo Peters, hon Chairperson of the Energy Portfolio Committee, Mr Njikelana, hon Ministers and Deputy Ministers present, Members of Parliament present, leadership of municipalities, our Director-General, Ms Nelisiwe Magubane, and all directors-general present, representatives of state-owned entities, invited guests, stakeholders, ladies and gentlemen, and last but not least, Team Energy ...
IsiZulu:
... umhlonishwa u-Greyling usuke akhulume kabi la ngoba ukhuluma ephakathi esiswini se-DA, i-DA isiyamngwinya. [Ubuwelewele.] Nakuba kunjalo-ke kodwa, umhlonishwa Greyling nabangane bakhe kumele bakhumbule uma bemi la ukuthi sikule nyakanyaka engaka nje- inyakanyaka efana namathumbu enkonyane - yingoba bona, ogogo babo kanye nomkhulu babo abazange bazinakekele izindawo zasemakhaya. [Ihlombe.] Yingakho namhlanje siphuma singena, sibona amahlazo. Abantu abakhulile abacishe bafike eminyakeni engama-80 noma ama-90 bengenawo ugesi wokukhanyisa. Lokhu kungenxa yokuthi ogogo nomkhulu bakhe babezicabangela bona bodwa. [Ihlombe.] Bengabacabangeli abantu abahlala emakhaya. Empeleni kufanele ngabe ninamahloni okukhuluma kodwa ngoba niyathanda ukuvulela ngaphansi kwekhala, niyama la nivulele, nikhohlise abantu bakithi nenze sengathi nina nenza ngcono kanti anizange nenze lutho olungcono.
Ugesi ubalulekile ezimpilweni zabantu abaphilayo ezweni elithuthukayo. Ngaphandle kukagesi konke kungacishe kufinyelele kwangqingetshe. Amandla kagesi awumgogodla wawo wonke umnotho oqinile.
English:
We are very proud of the fact that over 84% of our people have access to modern energy today. [Applause.] This is a far cry from the terrible situation in 1994, when approximately only 36% of the population had access to electricity.
IsiZulu:
Icala-ke liqulwa ngofakazi. Naba ofakazi, izimeya zemikhandlu yethu, zingasukuma la zifakaze ukuthi ngempela lokhu engikushoyo kuyiqiniso, asikhulumi nje into engekho.
English:
There will be those who will try and deny our achievements, of course, but the facts speak for themselves. Let me add that we are also coming to the 15% who do not yet have electricity. These will also include the infills that the Minister spoke about.
IsiZulu:
Ngaphansi kobuholi bukaNqgonqgoshe wezaMandla, uNkosikazi u-mam Peters, asiyi lapho kukhanya khona, kodwa siya ezindaweni ezingenawo ugesi. Sifike sizame ukuthuthukisa lezo zindawo, mhlawumbe yingakho laba bengasiboni nje, yingoba asiyi vele khona. [Ihlombe.] Sikwenzile lokhu entombini endala, singaqali kuyona kuphela. Le ntombi ecishe ibe neminyaka efinyelela ama-80 ngobudala sikwazile ukuyishiya imamatheka ngoba ngokokuqala ngqa empilweni yayo, isiyakwazi ukuphakamisa umunwe ichafaze inkinobho kagesi. Yona ikwenza manje lokhu, ogogo nomkhulu balaba kade bakwenza lokhu. [Uhleko.]
Umbuzo uyohlala umile uthe mpo! Nanoma ningenzani noma ningama ngamakhanda izinyawo zibheke phezulu. Umbuzo uyohlala umile uthi: nina njengoba naniphethe, ugesi naniwuyisa kuphi? Iyavela-ke impendulo ukuthi nina nanifakela idlanzana labantu. Thina yingakho sinezinselela; yingoba sifinyelela kubantu abangaphezulu kwalabo nina enanibanakekela.
Njengoba ngishilo ukuthi asikhulumi nje emoyeni, icala liqulwa ngofakazi. Sinomasipala engicabanga ukuthi abaholi babo bakhona khona la, ngikhuluma ngoMasipala baseDanawozi, wena ungakubiza ngokuthi yi-Dannhauser. [Uhleko.] Labo masipala bakwazile ukufinyelela kolokhu okuthiwa ...
English:
...universal access. For the first time in history [Applause.]
IsiZulu:
...bakwazile ukuthi ngemizamo yomnyango kanye nohulumeni bakwazi ukwenza ukuthi bonke abantu endaweni yaseDanawozi bakwazi ukukhanyisa ugesi. Akukaze kwenzeke lokho ngaphambili.
English:
Last year, we hosted the Electricity Indaba, where shortcomings were identified in the current Integrated National Electrification Programme. In addressing these challenges, we have introduced the Household Electrification Strategy.
The key focus areas of this strategy include the electrification master plan based on the least-cost approach that combines grid and high-quality nongrid solutions to support high-backlog, low-delivering municipalities.
IsiZulu:
Ngiyethemba-ke ukuthi abaholi bomasipala abakhona la bazolalelisisa kahle ukuze bangasidonsi ngamabhantshi uma sihamba besifuna ugesi. Sifuna balalele kahle ukuthi kuzokwenzeka kanjani. Lolu hlelo engikhuluma ngalo akulona uhlelo esizoluqala phansi, kodwa sithuthukisa uhlelo oluvele lukhona.
English:
The Department of Energy together with the Development Bank of Southern Africa, DBSA, will continue with implementing the agreement to accelerate the electrification programme in our country. The so-called front-end loading applies to municipalities with large electrification backlogs, which in turn will apply to the DBSA for funding. The bank will conduct bank credit assessments and we will only support bank-approved applications that are within the Integrated National Electrification Programme.
IsiZulu:
Kuzobalulela-ke ukuthi imikhandlu yethu iqinisekise ukuthi amabhuku ayo kanye nokwenza kwabo izinto kumi ngomumo ukuze bakwazi ukuhlomula kulo hlelo lwethu.
English:
We must also acknowledge the support of our international partners in supporting our programme. Assistance has been received from the International Finance Corporation, which is part of the World Bank group in the development of the new household electrification strategy.
IsiZulu:
Nizokhumbula nalapho ukuthi thina sisodwa njengohulumeni ngeke sikwazi ukumelana nemisebenzi esilele emuva ebese ngiyibalile. Yingakho sidinga abantu abafana no-DBSA kanye neBhange Lomhlaba ukuthi basilekelele lapho thina singakwazi ukufinyelela khona.
English:
As we enter the winter period, we have to be more vigilant about the risk posed by the increasing electricity demand to an extent beyond our supply capability.
IsiZulu:
Kuzodingeka ukuthi sikuqaphele lokho. Akuyona into okufuneka ukuthi sime la njengo-Greyling, sisine ngayo njengoba besina nje. Basinela ukuthi kungenzeka ukuthi kube mnyama. Lokho kuyabajabulisa bona. Engingakutholi kahle ukuthi uma ugesi ungahle ucime, angithi nabo ... [Ubuwelewele.]
English:
The HOUSE CHAIRPERSON (Mr M B Skosana): Hon member, please take your seat. What is your point of order, hon mrmber?
Mr B M BHANGA: The point of order is that the hon Deputy Minister is referring to an hon member in person. The Rules of the House dictate that we must refer to members as hon members, unless the hon ANC members do not understand the Rules. [Interjections.]
The HOUSE CHAIRPERSON (Mr M B Skosana): I am afraid this is not a point of order. Please proceed, Deputy Minister.
IsiZulu:
IPHINI LIKANGQONGQOSHE WEZAMANDLA: Musa ukuchitha isikhathi wena siyasebenza la. [Uhleko.] Uzocisithela isikhathi la. [Ihlombe.]
English:
We have to revert back to the mechanisms that we relied upon in 2008, including non-Eskom generation, fuel switching through LP gas, LPG, and other appropriate customer behaviour changes.
IsiZulu:
Kubalulekile ukuthi imikhandlu – ewu!, uyangiphazamisa, awukahle kancane – kubalulekile ukuthi imikhandlu ibe nezinhlelo ezizokwazi ukuthi bakwazi ukonga ugesi. Kungabi ukuthi yonke imikhandlu ifuna ugesi. Yibani nezinhlelo zokukwazi ukuwonga lo gesi esiwufunayo.
English:
These are the things that we can do together in the spirit espoused by the ANC of achieving more by working together. [Applause.] We have initiated a campaign urging communities to ensure that their cylinders are filled up. The LPG suppliers have assured the department that they will produce adequate LPG and import the shortfall where needed.
IsiZulu:
Uyashweba-ke umhlonisha u-Greyling ngoba abakhiqizi be-LPG bayasithembisa ukuthi bazosilekelela. Ngeke kube njengoba yena ecabanga.
English:
We have kept the lights on for the past seven years without any major disruptions and we remain committed to keeping the lights on. Ngiyabonga. [Thank you.] [Time expired.] [Applause.]
IsiZulu:
Ngiyabonga.
The HOUSE CHAIRPERSON (Mr A Mlangeni): I just want to remind members, please let us respect one another. [Applause.] Order! Order, please! Let us respect one another. Let's respect everybody here. The Rule is that when you refer to a person, please do not forget to say "honourable". Thank you.
Mr G S RADEBE /JN//ZLU LIM CHECKED//END OF TAKE
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 48
"Old Assembly Main",Unrevised Hansard,29 May 2013,"Take 48 [Old Assembly Main].doc"
"Old Assembly Main",Unrevised Hansard,14 May 2013,"[Take-48] [Old Assembly Main][90P-4-082A][mm].doc"
The DEPUTY MINISTER OF ENERGY
Mr G S RADEBE: Hon Chairperson, hon Minister, hon Deputy Minister and other hon members in the House, distinguished guests, captains of industry, I greet you now. I just want to pass this on, I can see that there's a pastor up there. Mfundisi, please help us, pray for these sinners to change. [Laughter.]
The Department of Energy is the most important department that cuts across all other departments. It is very important that we take note that without this department there will be no life in this country. From the outset, it should be stated unwaveringly and succinctly that it is of the utmost importance that we reaffirm and reconfirm the noble ideals, principles, policies, traditions, norms, values and revolutionary ethics that define our historic existence as the ANC. It is definitely supposed to be noted that there is no other revolutionary organisation.
IsiZulu:
Ayikho inhlangano efana noKhongolose; nguye kuphela okwazi ukunakekela abantu bakithi ikakhulukazi abantu abampofu la ezweni lethu. [Ihlombe.] ... especially the poor people in our country. UMongameli ngokusebenzisa ezinye zezinhlelo zethu...
English:
...through the eye of the needle has managed to appoint the Minister and the Deputy Minister to champion the interests of our people in ensuring that energy becomes the most important issue in our country. The ANC made sure that it has given us the tools of analysis and our strategy and tactics can also be implemented in championing the interests of our people. We are definitely doing that. That is why most of our people have electricity today.
The Department of Energy, since its establishment in 2009, has done tremendous work in responding to the call of the President in filling all the vacant posts. The department has established its own organogram and already 815 posts have been approved by the Treasury. We would like to acknowledge the Minister for the improvement and the...
IsiZulu:
...naleli banga esesilihambile kulesi sikhathi samanje. Sibonga nokunye okwenzile, Ngqongqoshe, ngoba kuyabonakala. Phela izifundazwe zonke bezingenawo amahhovisi ezaMandla kodwa manje siyabona ukuthi ukwazile ukwakha la mahhovisi. Uma bekunemidlalo yama-Olimpiki ngabe senithole izindondo zegolide angazi ukuthi ezingaki. [Ihlombe.]
English:
Since the establishment of this department it has received a clean audit. It shows the commitment of the ANC in ensuring that it provides service delivery to our people. [Applause.] With regard to the transfer of the funds mentioned in the 2012 report, we noted that the arrangements for and requirements of the Integrated National Electrification Programme, INEP, through the Municipal Infrastructure Grant as defined in the framework for the allocation, were not adhered to, as the department the signatories have not been implemented so far in the memorandum of agreement. This has been established because of the challenges as mooted mandated by the municipalities for not being in compliance with all the legal issues that they supposed to do; those in contravention of the Division of the Revenue Act. This must be followed up, Minister. You, together with Salga, find possible solutions to avoid these kinds of audit complaints.
Hon Chairperson, in terms of the unauthorised and irregular expenditure that we witnessed in the department, we noticed that the Minister has taken serious steps to ensure that all those who do not respect the Public Finance Management Act, PFMA, and the Treasury Regulations, are being taken into serious disciplinary processes. We would like to convey appreciation to the Minister with regard to the President's call that we cannot allow corruption. You are also taking very serious steps. This is one of the steps that we must be able to appreciate – that the ANC really delivers.
Hon Chairperson, after the 37 years of the youth revolution, we would like to express appreciation for the Youth Accord that has been signed and also express appreciation for the fact that it has already yielded the positive results of 1 200 graduates since it has been signed in April. This is a sign of a better future for our country. We really need to appreciate this, Minister, because it says that all the departments and the government of the ANC take the issues of young people very seriously. Minister, I am lobbying you in this special Budget Vote debate today to throw your weight behind youth development. With this I am trying to say, please try and ensure that at least about 70% of your budget focuses on youth development. This would play a key, critical role in ensuring that the process, through employment and the renewable projects, is successful because these are the projects that are supposed to yield positive results.
You must ensure that you review your old agreements with the youth organisations, such as SA Youth Council, SAYC, to ensure that the legacy that we want to leave becomes the future of our South Africa. If you can do that, Minister, and leave that legacy, the ANC ancestors will be happy about that, as will all the other freedom fighters.
During the workshop in May 2012 some of the other Setas, came on board to ensure that they proclaim their responsibility to measure key skills ensuring that the scarce critical skills are addressed. We must appreciate the issue of skills development in terms of this Seta, the Construction Education and Training Authority has managed to create a electrical construction operation, which is the certification that is going to address electrical installations, solar water heating installations, other business management projects assessment and moderation. This skills development facilitates mentorships for young people.
In providing funding to address the challenges of the scarce and critical skills in the subsector, the Ceta based its operations on the key principles of compliance with the National skills Development Strategy, NDSD 3, for the sake of redress in respect of the marginalised and vulnerable group, to provide greater access to the subsector and improve quality based on the use of subsector expertise.
It is very important, Minister, that we take note that all these other Sector Education and Training Authorities, Setas, especially the Local Government Sector Education and Training Authority, LGSETA, throws its weight behind addressing the lack of skills because those skills are also based in the energy sector at the local government level. We must also have appreciation for the LGSETA for the responsibility that it has taken to ensure that it facilities all the training regarding sustainability, efficiency and effectiveness in terms of providing basic services in the electrical profession.
We must be able to acknowledge, Minister the role that the LGSETA has played and its responsibility. We saw that some of the other good skills are those utilised by informal settlements. These are illegal connections, where good skills are utilised in the wrong sectors. This collaboration must be seen to go a long way. The allocation of these good skills to this training of our own people is going to address these "izinyokanyoka" people who do illegal connections.
On the capacity development, it is very important that we also take note that the Wholesale and Retail Sector Education and Training Authority, W&RSETA, in the energy sector has managed to put its own energy into the fuel and retail sector. After the announcement of the Minister of Higher Education and Training in November 2010, the W&RSETA has signed a memorandum of understanding with the Manufacturing, Engineering and Related Services Sector Education and Training Authority, Merseta, which arranged the bulk transfer of 3 256 levy-paying companies from the MERSETA to the W&RSETA. The W&RSeta officially took over the fuel retail Seta from the 1 April 2011. It has managed to receive R26,9 million in levies. This comes to a total of 11 915 people who have been trained as wholesale providers.
In painting a picture of the national Chemical Industries Education and Training Authority, Chieta, it has said that of the 13 million workers of the country, 48,5% have no matric, and 30,4% have matric and only 19,9% have postmatric qualifications. South Africa is ranked 50th by the World Competitive Report for 2012. The low education level of the country's human resources and the high unemployment were the main contributors to the poor rating.
We want to appreciate that all these efforts by these Setas, the issue of the level of the energy within our country becomes one of the most important and must be addressed as soon as possible. The department's focus will also be on increasing the modern energy resources implemented by Eskom and municipalities to reach the target of electrifying 645 000 households by 2015-16 in terms of the Annual Performance Plan. One has to acknowledge the skills development that has been contributed by Eskom. Eskom managed to convey skills to about 5 200 learners. The ANC supports the Budget Vote. [Time expired.] [Applause.]
Mrs I C DITSHETELO
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 48
Mr G S RADEBE
Mrs I C DITSHETELO: Chairperson, we commend that the department has an Integrated Resource Plan spanning over 20 years. However, it would be much more helpful if the information on the department's performance in terms of this plan could be easily available in the public domain. A total amount of R47 billion
,,
in investments will hopefully cause significant reforms in attempts to meet the increasing demand for power. Of course, the country is also facing many challenges, unemployment being one of the major ones, so such massive investments should therefore address not just one issue, but also impact on others. It would be interesting to know how many jobs have been created through the projects aimed at addressing power demands and what has been done to address skills shortages in these fields, today and for the future.
We would like to know whether we have capacity to deliver world class renewable energy assets which will in turn attract more investments and jobs. No doubt the cliché saying that within a crisis lies an opportunity rings particularly true in South Africa's context as the energy shortages we are experiencing, are making it even clearer that our current resources are not coping and the need to broaden energy supplies have become imminent and urgent.
However, the disappointment is in the slowness of pace with which the Medupi plant is moving and all the controversy that it is immersed in. We can only hope that in the end it will come through on its deliverables. One thing for sure is that the economy cannot afford to lose the billions it lost in 2008, when power outages became intense.
The high tariff hikes are not making life any easier for ordinary citizens and it baffles many of us why households and ordinary citizenry must be penalised for Eskom's incompetence and failure to foresee that our energy supplies had dwindled and were not coping. We support the move towards building renewable energy plants as they obviously take considerably less time than big plants such as Medupi. The UCDP supports the Budget Vote. [Applause.]
Ms B TINTO / GG//ZLU LIM CHECKED// END OF TAKE
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 49
"Old Assembly Main",Unrevised Hansard,20 Jul 2013,"Take 49 [Old Assembly Main].doc"
Mrs I C DITSHETELO
Mrs B TINTO: Chairperson, hon Minister and Deputy Minister, honourable director-general, Nelisiwe Magubane, Members of Parliament and our guests, I just want to tell the hon Greyling. Ooh, you like him, hey! You like him! [Laughter.]
I was born in Gugulethu. Your forefathers were sitting there and decided that Gugulethu would never be electrified because it was called a "native yard" ... [Interjections.] ... a place where only black people stayed, so they would not need electricity. [Interjections.]
Mrs S P KOPANE: Chairperson ...
Mrs S P KOPANE: Chairperson, on a point of order: The ID was never in power at the time. [Interjections.]
The TEMPORARY CHAIRPERSON (Mr A Mlangeni): Order, order! Order, please. Order! [Interjections.] [Laughter.] What is your point of order? [Laughter.]
Mrs S P KOPANE: The point of order is: The hon member here is misleading the House. [Interjections.] The ID was never in power, so for her to point at and say what she is saying to the hon Mr Greyling is really uncalled for. [Interjections.]
The TEMPORARY CHAIRPERSON (Mr A Mlangeni): That is not a point of order. Please sit down. Carry on, hon member.
Mrs B TINTO: The hon member who is speaking is not a member of the ID. She is a member of the DA. [Interjections.]
The ANC supports Budget Vote No 29 of the Energy Department. The Integrated Energy Centre Programme was introduced in 2002 to contribute to the Integrated Sustainable Rural Development Programme. It is considered an appropriate mechanism to deliver affordable energy to mostly low-income communities in remote areas and to be a one-stop shop offering energy goods. The ANC applauds PetroSA for launching the latest integrated energy centre, IEC, in Mbizana in the Eastern Cape in November 2012.
IsiXhosa:
Umntu xa enze into entle mncome. [Commend a person when he or she has performed very well.]
English:
It will be a source of petrol, diesel, paraffin and LPG gas to the community and it will employ about 15 people, or more. In the words of our Energy Minister, the hon Dipuo Peters:
IECs are not just about the integration of energy services. Rather, they are primarily about integration and co-operation among the three tiers and structures of government for improved delivery of energy services to the poorest of the poor.
Rural development and rural communities are dear to my heart, so it is also heartening when we consider another IEC launched in 2011 by the petrochemicals firm Sasol and the South African government. The R8 million integrated energy centre in the rural Eastern Cape town of Qunu was launched in January 2011 to assist with poverty alleviation and the community's energy needs. In addition, however, the centre also offers services such as a library, information centre and a community room for the suse of the community.
The integrated energy centre also has a village vendor network of people and these are mainly women and youngsters. People can purchase energy products from these vendors, who come to them. You know, when one empowers a woman, one empowers a nation. That is true, because those women make use of those vendors. They do not have to travel long distances because the centres are right in their communities.
We need interventions like this to assist the rural communities we care about. They assist the women and children, who need to be protected in our communities. It assists with giving access to the warmth that they so desperately need in winter and putting that hot meal on the table. We applaud the hon Minister for taking the lead in addressing the needs of the poor rural communities. We applaud the hon Minister for the programmes on youth, women, and people with disabilities. However, we also ask the hon Minister to do more, especially for the people living with disabilities. The programmes that currently are running in her department must address these needs.
Further, there is an accelerated development programme in PetroSa, in which 30 out of 91 employees in the Leadership Development Programme are women. The study assistance and bursary programmes also aim to ensure sufficient female representation. The company numbers on gender equity are in the order of 50%. With regard to people with disabilities, PetroSA has taken the approach of identifying students living with disabilities to participate in programmes and making progress through the ranks.
The SA Nuclear Energy Corporation, Necsa, is also finding ways to bring in young talent by partnering with various institutions. Further, the Nuclear Skills Development Centre aims to train 218 apprentices at its facilities. Members acknowledge and thank the National Energy Regulator of South Africa, Nersa, for the Techno Girl programme and its success in Limpopo. We encourage them to keep up the good work, especially in rural areas.
There is also the SA National Energy Development Institute, Sanedi, with its idea of including e-learning in its smart grid technology. The idea of using tablet computers to control the smart grid and independently making this available to our learners is the kind of effort needed to help to develop communities that are lacking these resources.
Moving to public participation for energy-related issues, it is crucial that communities be given a hearing on issues that affect them and, more importantly, have their input considered in the deliberations. In this regard, for example, Nersa's handling of Eskom's Multi-Year Price Determination, where public hearings were held around the country, is commendable. Communities need to be heard, and I am sure Nersa has learned a few lessons and will keep these in mind going forward, but it is commendable. I also attended one in Cape Town, where "abahlali" [communities] were voicing their concerns at the 16% increase in electricity tariffs. Nersa listened to that.
We are also awaiting the department on regulations that will facilitate the formation of consumer forums by municipalities. We are aware that the director-general, Nelisiwe Magubane, instructed her team to ensure that the regulations are finalised, but we are watching Ms Magubane.
Research into alternative energy sources needs to be enhanced. Ethanol gel was one such alternative fuel which is safe for use in rural homes, rather than paraffin. Research into development of such fuels, which could be safer and cleaner than paraffin, needs to continue. Further, the issue of biodigesters is also important, as it is a possible mechanism of converting biomass into energy for use by communities and even in rural schools. Continuous research is needed in these areas to assist rural communities to access alternative energy sources.
The distribution of solar-powered lights to rural schools in Limpopo, KwaZulu-Natal and the Eastern Cape is an excellent example of how the hon Minister and her department are finding solutions to some of the energy problems of our country. Further, the Basa Njengo Magogo project has been rolled out in the Gauteng province. We are waiting for the other provinces. Only last weekend, we lost a life here in Cape Town, in the Strand, because of a shack fire.
The ANC supports Budget Vote No 29. [Applause.]
Mr D C ROSS
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 50
Mrs B TINTO
Mr D C ROSS: Chairperson, what South Africa needs and as soon as possible, hon Minister, is enough power at as low a price as possible. Last week the Minister of Public Enterprises, Mr Gigaba, said: "Cabinet is set on embarking on a nuclear plan with Eskom at the helm." This was also alluded to by hon members in today's debate, and the Minister endorsed that view.
This endorses the Integrated Resource Plan 2010 in terms of the percentage allocation for nuclear in our energy mix. But, Minister, that is on the one hand but the other side of the coin is that the study towards a new power plan commissioned by the National Planning Commission indicates that we should consider delaying the proposed expansion of nuclear power stations. This is a bit of a contradiction. Are we not aligning ourselves to the National Development Plan, then?
The plan indicates that more nuclear power would not be needed before at least 2029, and perhaps not until 2040. South Africa's Integrated Resource Plan 2010 is, therefore, out of date and could lead to the building of unnecessary power stations at great cost and higher electricity prices.
The DA has called repeatedly for an urgent review of the country's 20-year energy plan. A continuation of the current plan will result in South Africa, and I am quoting the hon Greyling, - who comes from a very good background and a very good family - when he said that South Africa would be left with "surplus, stranded, expensive" power plants.
Hon Minister, government has already made an investment into the long overdue Medupi – and everybody knows the concerns with regards to finishing Medupi - and we need to finish it as soon as possible to get security of supply. We also need to finish Kusile and Ingula Power Stations coupled with lower demand for electricity and progress in renewable energy, which endorses the findings of the study by the National Planning Commission.
The IRD is meant to be revised every two years, and is due for revision this month, but the Department of Energy said that it would not be done until the Integrated Energy Plan has been finalised.
Chairperson, acknowledging that the IRP is out of date, we now need clarity with regard to our energy mix, which we really need seriously, and the security of supply, as hon Smalle has indicated, as well as confidence in the Eskom pricing applications.
Now, with regard to the pricing applications, because I think that is very important, in the Multi-Year Price Determination 3, MYPD 3, Eskom has in effect made two applications to the National Energy Regulator of South Africa, Nersa - I hope that Cabinet is aware of this. The first application was a formal application through to 2018 and the completion of the current new Bill. That is the current situation. In that application the tariff rose by 16% from 61c per kWh to 128c per kWh.
We were painfully aware of the negative impact in terms of the economy with regard to that, and the position of consumers and businesses, and we all agree. I think there is general consensus with regard to that, Minister. Our position was that Eskom should only be granted an inflation-related tariff. And I think there was also some consensus, and positive remarks in this regard.
In our presentation to Nersa, the DA took particular issue with two components of the Eskom pricing applications, and the chairperson was present when I made my presentations to Nersa in Cape Town, the return on equity and the return for the shareholder. Government was scaled down, and we are very grateful about that. In terms of the depreciation, that was also scaled down because of the cost of replacement of assets. We acknowledge that Nersa cut them down to size because it was completely inflated.
The DA argued that the consequences of revising the price formula and extending the timeframes should be seriously considered and we, in fact, made three presentations to the regulator.
The regulator pulled no punches in its decision and I think they also endorsed our views. The price then came down from a 16% to an 8% hike a year for five years ... [Interjections.] ... yes, our views, it could be yours too, Minister, if that is your view ... [Laughter.] ... explaining that Eskom could be more efficient. It could no longer pass the cost of electricity buyback programmes on to the consumer; I think that those were all our views. It also did not need a higher credit rating than the government because a state-owned entity is part of government. We really commend Nersa for that decision in this regard.
Now with regard to another problem – which I think that is what we need to discuss today and I hope the time will allow us to do so. The second application of Electricity Supply Commission, Eskom, to Nersa is extremely problematic and is still applicable. It is an Integrated Resource Plan application, which takes into account the expansion of the power sector beyond Multi-Year Price Determination 3, and it includes the building of six nuclear power stations totalling 9 600 megawatts.
Just take note, in this case Eskom will say they need another 20% increase from 2013 to 2017. That is in a second application, which is a reality. But simply that will take us back from a reduction in price from 16% to 8% and then back to 20% and then to 24% and after the MYPD 3, it would then escalate further to a further 9% increase year-on-year.
Chairperson, I ask you, can we afford this? I think this is a serious issue that Cabinet needs to consider. The Electricity Supply Commission argued that the government must take decisions on expansion beyond the current new Bill. If Nersa considers only the formal application, Eskom says it will have to ask for more when those new decisions we are talking about are made.
This will have profoundly negative implications for our struggling economy. It will lead to stagflation - we all know what stagflation is. It is high inflation and very low growth. We are caught in that trap. It was also mentioned by the Governor of the Reserve Bank and it is hugely problematic. Minister, I think those are issues, and I would be glad if you could give me an invitation, and perhaps we ... [Applause.] [Laughter.]
What needs to be done, Madam Minister, is not talk about the budget right now, but to talk about the Eskom price applications. And it needs to be discussed as soon as possible, namely the issue of enough power at the lowest price possible.
The Integrated Resource Plan, Madam Minister, is in time out of date at this point and has caused justified uncertainty regarding the sound management of issues relating to our energy mix and energy pricing. I think, Madam Minister, the energy steam has a long way to go. I think what we need to do is revise the IRP so that we can have clarity in terms of supply, pricing, and also the direction that we need to go. Thank you very much. [Applause.]
Mr K A MOLOTO / MALUTA ///tfm\\\END OF TAKE
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 51
"Old Assembly Main",Unrevised Hansard,20 Jul 2013,"Take 51 [Old Assembly Main].doc"
"Old Assembly Main",Unrevised Hansard,14 May 2013,"[Take-51] [Old Assembly Main][90P-4-082A][mm].doc"
Mr D C ROSS
Mr K A MOLOTO: Hon Chairperson of the House, hon Minister of Energy and Deputy Minister, hon members, officials from the Department of Energy and senior leadership of entities reporting to the Department of Energy, distinguished guests, let me respond to the hon Smalle before I proceed with the rest of my speech.
I advise the hon Smalle to read the National Development Plan, NDP, carefully. With regard to a decision to be taken on whether we need to build a new refinery or not, the NDP makes this critical observation worth noting. It indicates that the change in the global refinery margins might occur if the current surplus in refined product occurs.
It goes on to say that such an occurrence will result in the increase of crude oil import bill, thus increasing significantly our current account deficit and affecting our exchange rate adversely. The NDP also indicates that the timing and the decision around building should take all these factors into consideration as South Africa will be importing more than 200 000 barrels per day of finished petroleum product by 2020. This would certainly send our current account deficit through the roof and lead to a serious weakening of our currency.
Hon Smalle, I find your statement on the shortfall of bitumen a bit contradictory. You cannot talk about the impending shortage in bitumen and in the same breath discourage PetroSA from building Project Mthombo. Bitumen is a by-product of the refinery production process. Therefore, Project Mthombo is critical to the development of the petrochemical industry in South Africa.
We now know that there is a serious closure of uncompetitive refineries in the US and Europe, leading to a partial elimination of the glut in finished petroleum products. In actual fact, there is a gradual recovery in the refining margins as this closure of these refineries contributes to the elimination of the excess.
Hon Smalle and hon Alberts, I had a look at the paper compiled by Prof Anton Eberhard. I will not cast any aspersions on the academic thoroughness and the consultation process in that paper. It is very important, hon members, that we understand the sequencing between the Integrated Energy Plan, IEP, and the Integrated Resource Plan. The Integrated Resource Plan is a subset of the Integrated Energy Plan. The Department of Energy has consistently indicated that by this year they would be approaching Cabinet with an updated IEP. The updated IEP has to inform the Integrated Resource Plan.
It is important to state the following about the assumptions on demand projections, various economic growth scenarios were subjected to a thorough public consultation process by the Department of Energy in developing the IRP. I have indicated that I don't want to cast aspersions on the consultation process of the paper that was compiled by Prof Eberhard. However, we know that there was not sufficient consultation around that paper. Various industry bodies, consumers, mining industries were consulted by the Department of Energy in that process of developing the IRP.
The department has always indicated – let me repeat that it will be reviewing the Integrated Resource Plan every two years. The Integrated Energy Plan is going to be submitted to the Cabinet with the view of ensuring that the re-evaluation of the assumption of the IRP occurs. The IRP will have to be aligned with the updated IEP.
Therefore, it would be incorrect to argue, as Prof Anton Eberhard had done, that we should look at the previous economic growth and demand, and extrapolate that data, and then make a claim that certain technologies are no longer applicable. [Interjections.] I can't hear you. [Interjections.]
The recent media coverage of alleged corporate governance lapses and possible corrupt practices in PetroSA are a source of great concern to all South Africans. It laid bare to all South Africans the procurement practices within our national oil company, PetroSA.
It would be a lack of appreciation and honour to duty on my part if I were to fail to congratulate the Minister of Energy and the board of the Central Energy Fund for the courageous leadership they displayed by initiating a forensic audit into the procurement practices of PetroSA after being alerted to possibly serious transgressions in the procurement practices of our national oil company.
The full might of the law has to be brought to bear on those who might have participated in such corrupt practices. The board of PetroSA has togive a full account of why such practices occurred on their watch, given that the Board Charter of PetroSA is aligned with the new Companies Act and King 111 principles. The critical question they have to answer is whether the board committees are fully functional and acting independently of the executive.
I'm raising this issue because we have given a clear mandate to the national oil company to assist government in ensuring the uninterrupted supply of liquid fuel. PetroSA cannot afford to lose focus and drop the ball at this critical moment, especially when they are required to undertake massive infrastructure projects and secure the much needed feedback for the Mossel Bay refinery.
Last year in my contribution to the Budget Vote debate, I indicated that international oil companies have exited from downstream activities on the rest of the continent. The trends are becoming much clearer now. The international oil companies have sold their stakes in refineries across the continent, with the exception of South Africa. The stakes sold by the international oil companies in downstream activities in Africa were bought by African national oil companies, with the exception of Kenya, Ivory Coast and Senegal. The Kenyan refinery was bought by Essar, an Indian company, the Ivory Coast refinery was bought by Sonagolo and the Senegal refinery was purchased by the Bin Laden Group of Saudi Arabia.
We note with great appreciation the announcement made by BP to invest R2,5 billion for the purpose of upgrading SA Petroleum Refineries, Sapref, in Durban. The Department of Energy has committed itself to support the upgrading of refineries through the adjustment of the basic fuel price without unduly overburdening the consumers. We encourage all the refineries to follow the example of BP.
There are some among us in this House who want to suggest that PetroSA should forego opportunities available in the downstream activities. Such a view is not anchored in reality and true facts. A national oil company cannot continue to play a marginal role in the domestic downstream sector. It has to be fully integrated, and capture value throughout the whole value chain.
The mandate that we give PetroSA is very clear. Get your act together and build a true national oil company worthy of pride of place among our people. The national oil companies in other jurisdictions are integrating to determine their business decisions in the interests of their country and encourage other economic activities linked to the refining of crude oil. We need the development of a significant petrochemical industry in South Africa. The decision made by BP is critical to building the efficiency and competitiveness of our refineries. Our existing refineries are old and not competitive when compared to their peer refineries in South East Asia, Europe and the new generation of up and coming Middle Eastern refineries.
Refineries that enjoy economies of scale and complexity will survive in this highly competitive industry. PetroSA has to focus on ensuring their Project Mthombo has economies of scale, complexity and the necessary funding to ensure the uninterrupted security of supply to South Africa.
We have stated before in this House that around 2020, South Africa - and we are doing it now - will be importing about 200 000 barrels per day of refined products if we do not succeed with building Project Mthombo. The consequences thereof are just too ghastly to contemplate. Our current account deficit will just shoot through the roof. PetroSA has to keep the eye on the ball. They dare not fail the country. They owe it to all of us.
PetroSA must ensure that they secure the feedstock for the Mossel Bay refinery. Our local gas feedstock will be depleted soon. They must focus on these activities. We have given a mandate to PetroSA to procure at least 30% of crude oil for South Africa by 2020. They need to assist government in diversifying the sources of crude oil for our country. PetroSA is fully aware of the implications of sourcing crude oil predominantly from one region. The Strategic Fuel Fund, SFF, has to work jointly with Transnet to ensure adequate port facilities to secure a consistent supply of crude oil to the inland refineries. There are 39 tanks of 200 000 barrels each in Milnerton for the purpose of crude oil storage that are currently in use. The SFF needs to ensure that the remaining 7 are put to good use.
The National Energy Regulator of SA, Nersa, deserves to be commended for the transparent manner in which they conducted the Multi-Year Price Determination, MYPD 3, application submitted by Eskom. It consulted with various stakeholders. You just have to go through the list of the stakeholders that Nersa consulted in the province and you will come to one conclusion, that it is quite fashionable for political parties to try to attract the glory to themselves, when all of us know that industry, mining, consumers and Cosatu make presentations to Nersa. For the DA to come here and claim that the reduction in the tariff is as a result of their efforts, is mischievous and ingenuous. [Interjections.]
The truth needs to be told when necessary. To just think that you will attract a few votes by stating the untrue, is beyond my comprehension. [Interjections.]
We have to keep the lights on. Nersa has the difficult task of balancing the interests of Eskom and those of the consumers. We have to keep the lights on, but at the same time not hurt the competitiveness of South African industries and protect the poor from high electricity tariffs and the provision of free basic electricity goes a long way in protecting the poor.
However, we need to state that the practice of municipalities of procuring 60% of their funding from electricity distribution is unsustainable. It results in prohibitive electricity tariffs being imposed on industry and consumers within the jurisdiction of municipalities. Funding municipal budget mainly through electricity tariffs will prove problematic in the long run. We need to move towards the standardisation of tariffs in South Africa. It has come to our attention that certain municipalities are adding mark-ups of several hundred percent to Eskom's Megaflex tariffs.
Last year I had an engagement with residents of the Free State on the local radio station. They indicated that the municipal electricity tariff they are made to pay is vastly different from the one consumers who were supplied electricity by Eskom pay.
These are serious matters. We need to be able to pay attention to the financial viability of municipalities because the challenge that the municipalities are facing is that the electricity tariffs serve as a cash-cow and they avoid the painful task of reviewing the tariffs they charge for other services.
Hon Minister, the ANC, the glorious movement of our people, supports this Budget Vote. Thank you. [Applause.]
The MINISTER OF ENERGY / Nb/Checked by Nobuntu / END OF TAKE
UNREVISED HANSARD
EPC – OLD ASSEMBLY CHAMBER
Tuesday, 14 May 2013 Take: 52
"Old Assembly Main",Unrevised Hansard,20 Jul 2013,"Take 52 [Old Assembly Main].doc"
"Old Assembly Main",Unrevised Hansard,14 May 2013,"[Take-52] [Old Assembly Main][90P-4-082A][mm].doc"
Mr K A MOLOTO
The MINISTER OF ENERGY: Hon members, I would like to point out that the path towards sustainable energy resources has been long and sometimes difficult. However, we believe that our journey is not complete until all South Africans have access to reliable, cleaner, safer and more affordable energy. We have committed ourselves to this task, and we will continue to work hard to "enhance the freedom of others and ensure all have lights to read books in the dark".
I realise that, together with the ANC, the UCDP as well as the IFP have indicated that they support the Budget Vote. [Interjections.] The other parties have not indicated whether they supported this Vote, and I would want to know from them whether this is an indication that they don't care about the challenges of our people who don't have access to energy. [Interjections.] We know that during winter in Cape Town, in the Western Cape, many of our people will have their shacks burnt down ... [Interjections.] ... primarily because they are using unsafe forms of energy. [Interjections.] [Applause.]
The R3,8 billion that is in the budget ... [Interjections.] ... is intended to make it possible for our people to have access to energy. Hon members, we know that you don't care, because it's not your people.
The TEMPORARY CHAIRPERSON (Mr G T Snell): Hon Minister, there's a point of order.
Mrs M A A NJOBE: Hon Minister, there is still a ... [Inaudible.]
The TEMPORARY CHAIRPERSON (Mr G T Snell): No, no, hon member, excuse me! Take your seat! Continue, hon Minister.
The MINISTER OF ENERGY: I want to say to hon Njobe that I respect her, her age and her history in the struggle, but I would like to correct her. She is supposed to show, in this House, and in this debate, whether she supports this. She shouldn't wait for the House, where we take the whole scheme of Schedules. [Interjections.]
I want to stay to hon Smalle, there was a song sung by Condry Ziqubu many years ago when we were still young, which says, "uma ukhuluma amanga uyakwaSathane" [When you lie, you will go to hell.] [Laughter.] Today I want to tell him that the people who come here and lie to the nation should realise that they are going to the devil's place, "kwaSathane". [Applause.] [Interjections.] We all know that there has not been any load shedding in South Africa up to now. What we did was to call on our people to use electricity efficiently ... [Interjections.] ... but we also need to realise that the challenge that we are faced with is the fact that some of the plants, including the major supplier, Cahora Bassa in Mozambique, is not operating because of the floods. I indicated that we have challenges because some of our plants have to be shut down for operational purposes. You can't just run a plant without maintaining it. [Interjections.]
The other challenge that you are referring to is not a power generation problem. You know it! It was a challenge relating to a cable. You know it was cable theft, but also a contractor who damaged the cable in the process of working in that particular area. So we shouldn't come here and tell the nation that there has been load shedding. There has not been load shedding. [Applause.] We are saying to the people of South Africa that if we don't use the little that we have efficiently, we will have to go that route. It is up to you and me to make sure that we speak to our constituencies to ensure that they don't abuse the system between 5 and 9.
We are also saying that it is important that people are not bought by using energy efficiently. [Interjections.] We should not tell our people that in order for them to save electricity they must be paid. You are sending out the wrong message, because you are actually talking to people who have lots of money, and who want to see a business opportunity emanate out of the challenges that we have with regard to energy.
I also want to say to hon Moloto that his colleague who comes from the same province as he, had spoken about the issue of bitumen. The Minister of Transport is here and he has listened to what you, and many others, have to say about bitumen. Bitumen is a by-product of crude oil refining and, as we all know, is used in road infrastructure development. We all know that other by-products are ethylene, propylene and other chemicals.
It is therefore important for us to know whether hon Smalle was saying that the function of the chemical sector should also be under my portfolio. Let us learn to think things through. The department was consulted by the Department of Trade and Industry on bitumen and a solution was found. This involved the relaxation of tariffs. I want to say to hon Smalle that it is important that we always tell the truth; and the truth shall set you free. [Interjections.]
The hon Moloto spoke a lot about the issue related to the Petroleum Oil and Gas Corporation of South Africa, PetroSA, and Project Mthombo. Let me say that we are going ahead in making sure that the people of South Africa have a reliable supply. If we have to do it, we will do it through the instrument that is in our hands, and that is PetroSA. It is important that you remember that. [Interjections.] What we do is in the best interests of the people of South Africa, so that we don't have shortages.
You would know that last year we had a serious challenge related to liquefied petroleum gas, LPG. What happened? We had to use PetroSA to make sure that we cover that supply, and PetroSA had to suffer losses because the other refiners see LPG as a waste product which doesn't guarantee returns. If we are going to determine everything on the basis of returns, then it means that South Africa will be in the dark. It is important that we remember that. [Applause.]
Hon Berend should know that when she speaks – and I am sure that their Acting Deputy Chief Whip did indicate that – in a maiden speech, or when she is her master's voice, she should tell us, because she said all sorts of things that are really not true. I would want her to engage with us in a real debate on the issues that she wanted to raise. When I was seated there, I actually realised that ...
Afrikaans:
My arme suster lees nou 'n toespraak wat deur iemand anders geskryf is. [Gelag.] [Tussenwerpsels.] [Applous.]
English:
I want to acknowledge and accept the accolades about women, and to add that we, as the Department of Energy, are working together with the Department of Women, Children and People with Disabilities, and other departments, including Science and Technology, through the efforts of its former Minister, Naledi Pandor, to make it possible that we bring in women, especially in the science, technology, engineering, and math, fields. We have a programme called C3E, which is a clean energy, education and empowerment initiative for women, because we believe that energy will not succeed in this country or even in the world without the participation of women. We believe that women are central. [Applause.] We don't want to come back in 10, 20 or 30 years to talk about transformation then. When the ANC speaks about women you will remember that we are talking about 50-50. The ANC is serious about it. We could have had 50-50 in this House if all parties had made sure that their lists were 50-50, but they did not do that. [Interjections.]
In the clean energy environment, we have an initiative called Empowering Women in Clean Energy, and we want to see it succeeds because we have inculcated it into the Renewable Energy Independent Power Producer, IPP, programme. We want those companies that won the bids to make it possible to contribute to making sure that women don't become "o-sihamba nabo". [followers.] Women must own shares, and must be part of the operations and management in every sector of this initiative. They can do it.
The TEMPORARY CHAIRPERSON (Mr G T Snell): Hon Minister, please conclude your speech.
The MINISTER OF ENERGY: The government has done it ... [Interjections.] ... because here we are. The Department of Energy is actually women-driven. I don't know whether you realise it. [Interjections.] [Applause.] The Minister, the Deputy Minister, the director-general, DG the chief executive officer of the National Energy Regulator of South Africa, Nersa, the chair of Nersa, the CEO of PetroSA and the chair of the Central Energy Fund, which shows that "Wathint'abafazi wathint' imbokodo". [You strike a woman, you strike a rock.]
An HON MEMBER: It doesn't mean that other women must remain silent.
Mr L W GREYLING: Chairperson, on a point of order. According to our watches the time for the Minister has expired, but we will give her another 20 seconds if she tells us whether she will review the Integrated Resource Plan, IRP. [Interjections.]
The TEMPORARY CHAIRPERSON (Mr G T Snell): I am sorry, hon member, but that's your watch. My watch says something different. Hon Minister, please conclude your speech.
The MINISTER OF ENERGY: Hon members, I just wanted to say ... [Interjections.]
Dr D T GEORGE: Chairperson, on a point of order. The Minister overran her time when she introduced her speech and we were informed by the Table that she would have eight minutes left. [Interjections.] She has exceeded that time, and if you are saying that she has not we would want it to be investigated. [Interjections.] We would like you to make a ruling, please. [Interjections.] We would like you to check what the time actually is because according to our records the Minister has already exceeded her available time. Please make a ruling. Thank you.
The TEMPORARY CHAIRPERSON (Mr G T Snell): Hon member ...
The MINISTER OF ENERGY: Chairperson, these people are wasting my time. [Interjections.]
The TEMPORARY CHAIRPERSON (Mr G T Snell): Hon Minister, please. Hon member, I appreciate your timekeeping. The Table d not inform me that the minutes had been reduced, and therefore I have asked the hon Minister to conclude her speech. Thank you.
The MINISTER OF ENERGY: Chairperson, will I get my minutes back? I want to say that it is important that we remember that whatever we are doing here, we are doing it ...
Mr T D HARRIS: Chair, on a point of order. [Interjections.] Quite frankly, this is an abuse. Everyone has to stick to their time allocation. It's only right in any debate. Secondly, the Table did inform you that the time had expired. I saw them do it.
The TEMPORARY CHAIRPERSON (Mr G T Snell): Hon member, please take your seat. I made, with the Whip of the Majority Party ...
The MINISTER OF ENERGY: Chairperson, you know they took my time.
The TEMPORARY CHAIRPERSON (Mr G T Snell): Minister, please hold on. The Whip of the Majority Party asked me to inform the Minister when there was three minutes left. The arrangement I had with the Table staff was that they would indicate to me when the time had expired. That is what I am doing. I appreciate your concern, but that is what I am doing. Hon Minister, I'm giving you one minute to conclude your speech. Thank you. [Interjections.]
The MINISTER OF ENERGY: People who are against transformation will behave like this. [Interjections.]
Finally, no one must doubt the ANC's intention of making it possible that we work together, and even better, to lead the charge in energy planning, modelling, forecasting and development in a bid to safeguard our country's security of supply. We do so, as President Mandela said, "not merely to cast off one's chains, but to live in a way that respects and enhances the freedom of others." [Interjections.] Hon members, I commend to this House the 2013-14 Budget Vote. [Time expired.] [Applause.]
The Committee rose at 16:44.
TH / END OF TAKE
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