IRP not outdated: Peters

Tuesday, May 14, 2013

Pretoria - The Integrated Resource Plan (IRP 2010-30) is not outdated but will be reviewed in line with the Integrated Energy Plan (IEP), Energy Minister Dipuo Peters said on Tuesday.

Responding to a question by media ahead of her department’s Budget Vote later today, Peters said the 20-year plan has been created deliberately so that it has loops for review.

“It was promulgated in May 2011.... This is the year that we are finalising the IEP of which the IRP is a subset. Within that total framework you are going to have a reviewed IRP in this particular financial year,” she said at a media briefing.

The IRP2010 places specific emphasis on broadening electricity supply technologies to include gas, imports, nuclear, biomass, renewables (wind, solar and hydro), in response to both the country's future electricity needs as well as reduce its CO2 emissions.

A study, commissioned by the National Planning Commission (NPC) and compiled by UCT’s Energy Research Centre, reported that the country’s energy blueprint was outdated and  went on to say among other things that the growth in electricity demand had been much lower than had been forecast among others.

“The NPC has got the right to do that [commission a study]. We have the mandate and responsibility to ensure that certainty is given to this country. Our plan is looking at the provision of energy. The National Development Plan (NDP) speaks about low carbon energy pro vision, the IRP speaks to that, and so does the IEP. We are the policy department, they [NPC] would sit and develop the framework for planning, and we would look at how to make it possible. The IRP is not outdated,” explained Peters.

Director General Nelisiwe Magubane said that assumptions that the demand for electricity have gone down were wrong and that the country faces challenges such as some plants having to be shutdown, adding that the fleet was no less than 35 years old.

The department will this year finalise the IEP. “We are going to do the IEP first and we are going to engage that for the next five months and in parallel we will be working on the IPR however the revision of the IRP will be informed by the input from the public on the IEP,” explained the director general. A specific date for the review of the IRP is not yet available.

The rationale for the IRP coming into being before the IEP was as a result of the 2008 energy shortage that was caused by a lack of long term planning. “The IRP was urgent [that it comes into being],” said Magubane.

In March 2012, the department held a consultative conference on the development of the IEP with work on the plan being completed in March 2013.  The completion and implementation of the IEP will enable the department to go ahead with the review of the IRP 2010. “We are now ready to equip the sector on our proposals for energy planning up to 2050,” said the department.

Peters said that the energy environment was a volatile one, while briefing reporters on the progress the department has made.

Developments at PetroSA

The minister touched on recent developments at PetroSA. The wholly owned subsidiary of the Central Energy Fund’s chairperson Dr Benny Mokaba vacated his post with immediate effect last month following the conclusion of an investigation which was ordered by the Minister, to investigate the robustness of the procurement system at the national oil company.

The investigation was part of an initiative by Peters to ensure adherence to good corporate governance principles and transparency at enterprises which report to the Department of Energy. The department said Peters was looking at implementing the structures and systems that have been identified as gaps within PetroSA.

The national oil company had fought to clinch an oil deal in Ghana in its plans to expand in gas and oil business on the continent.

“With regards to the Ghana deal, we are going further looking into the potential for the impact on the oil build. The work that PetroSA is doing with regards to sourcing is not going to be affected by what has been revealed,” said the minister, adding that PetroSA will be strengthened.

“The report points to particular areas and lapses in governance and procurement systems,” she said, adding that heads will roll in the matter.

Department’s successes

Among the successes of the department was  that more than a million households now had access to electricity  translating to over 84% connections and that more than 350 000 solar water heater geysers have been installed. The first window and second window of the Renewable Energy Independent Power Producers Programme (REIPPP) -- that will contribute to the country’s energy mix and job creation -- had reached financial close.

Additionally the Independent Systems and Market Operator (Ismo) Bill which sets out to restructure the electricity supply industry has been adopted by Portfolio Committee is on its way to the National Assembly for Debate.

In the 2012/13 year the department spent 98.9% of its R 6.7 billion budget of which a total 95% was disbursed in transfers for the implementation of the energy programme while the remaining 5% funded departmental operations.

 

Budget 2013/14

The department’s 2013/14 budget is 6.5 billion of which 93% is earmarked for transfers to municipalities and SOEs leaving 7% for operations.

The focus this year will be on finalising and promoting energy security by managing demand and encouraging the use of LPGas for cooking and heating in homes.

Among the challenges faced by the department is the implementation of the Energy Efficiency Strategy aimed at changing behaviours of energy users.

Another is the audit of refineries which has been completed. “It indicates the need for increased investment in them, the facts gained from the audit will serve to inform the liquid fuels infrastructure roadmap due for completion in the current financial year,” the minister said.

The audit put in place last year was so as to determine the real status of their production capacities and capabilities. - SAnews.gov.za