The Department of Energy (DoE) will work towards finalising an Integrated Energy Plan (IEP) for South Africa during the current financial year, Energy Minister Dipuo Peters said on Tuesday.

Speaking at a media briefing prior to her Budget Vote speech for the 2013/14 financial year, the Minister noted that the IEP would set out the provision of all energy sources, and not only electricity, in the country up to 2050.

DoE director-general Nelisiwe Magubane added that the IEP would incorporate the DoE’s new Liquid Fuels Master Plan, the Gas Infrastructure Plan and the Integrated Resource Plan for 2010 (IRP 2010), besides others.

Responding to criticism that the IRP 2010 was outdated, Peters asserted that the plan was developed as a 20-year plan and that the DoE had created it deliberately with “loops for review”.

She noted that the IRP 2010 was a subset of the IEP and that it was, therefore, important for the DoE to finalise the IEP first, rather than focus solely on reviewing the IRP 2010.

Magubane agreed, stating that work to review of the IRP 2010 would be done in parallel with the IEP.

She, too, stressed the importance of finalising the IEP first, explaining that the only reason the IRP 2010 was finalised before the IEP was because South Africa had to urgently deal with its electricity supply shortages following the power blackouts in 2008.

Further, she stated that even if electricity demand was currently lower than estimated in the IRP 2010, the country could not scale back its electricity infrastructure expansion plans.

Magubane noted that South Africa’s coal-fired power stations were, on average, 35 years old and that the plants would have to be retired at some point in the future, not only owing to their age, but also as a result of new air quality standards.

Nuclear Energy
Meanwhile, Peters asserted that nuclear energy offered “tremendous benefits” for South Africa. These benefits would include industrialisation and localisation opportunities and would “leapfrog” the country into the knowledge economy.

“We also believe that the Youth Accord will be given expression through massive skills development in this programme,” she stated.

South Africa’s nuclear build plan was aimed at adding 9 600 MW of nuclear electricity generation capacity to the national grid by 2013.

The Minister noted that the National Nuclear Energy Executive Coordination Committee, which was responsible for monitoring and ensuring oversight of the implementation of the country’s nuclear new build strategy, was now in place.

Further, the National Nuclear Regulator and the South African Nuclear Energy Corporation, or Necsa, would continue to work with the DoE on preparatory work for the nuclear expansion programme.

In addition, the National Radioactive Waste Disposal Institute has been established and would be operation in the 2013/14 financial year.

Peters highlighted that South Africa had, in February, participated in an International Atomic Energy Agency-led International Nuclear Infrastructure Review (INIR), adding that South Africa was the first country with an operating nuclear power plant and reactors to voluntarily conduct such a readiness assessment.

Magubane noted that, before the results of the INIR could be made public, the DoE would have to receive recommendations on any gaps in South Africa’s nuclear plans.

Once these recommendations were received, government would first “ponder” any gaps before it is released to the public.

Peters, however, assured stakeholders that the DoE would continue working towards reaching a final investment decision towards the procurement of nuclear power plants.

PetroSA
Commenting on recent developments at PetroSA, Peters asserted that it was important for South Africa to have a credible national oil company (NOC).

In April, the Central Energy Fund (CEF) announced that PetroSA chairperson Dr Benny Mokaba had vacated his post, following an investigation into alleged irregular spending and other governance issues.

The Hawks were also investigating the matter.

When asked whether more heads were likely to roll following the investigations by the DoE and the CEF, Peters said it was important to first identify “the right heads”.

“Heads will roll within correct legislative parameters,” she added.

Further, she assured that the identified governance issues would not impact on the NOC’s projects.

“PetroSA’s projects are still on track this year. For example, the project to support and extend the gas-to-liquid refinery will be on stream. The technical studies for the liquefied natural gas import projects are expected to reach completion. And, we expect to see advancements in the feasibility and front-end engineering and design studies for the Mthombo project.”

Meanwhile, other priority projects for the DoE for the 2013/14 financial year would include working with the National Energy Regulator of South Africa to provide a framework, the Approach to Distribution Asset Management (Adam), for using tariffs for infrastructure rehabilitation.

Peters noted that the deterioration of the country’s electricity distribution infrastructure was adversely affecting service delivery and that the Adam project would work towards mitigating this.

The department would also work to promote the use of liquefied petroleum gas (LPGas) in homes, as well as by businesses and industry.

Further, the department would also publish the universal access strategy, which would incorporate grid and off-grid energy solutions, during the financial year.

“In the interim we will roll out a comprehensive energy solution in both informal and new housing developments.

“This will incorporate grid electricity, solar water heating and LPGas for formal dwellings, while informal settlements will be directed towards LPGas for thermal needs, as well as a [solar photovoltaic] technology solution for lighting and [low] power [use].”

The DoE was allocated a R6.5-billion budget for the 2013/14 financial year, with 93% of the funds to be transferred to municipalities and State-owned entities and the balance to be used for the DoE’s operational and capital expenses.