Thank you Programme Director,
Minister in the Presidency responsible for National Planning, Minister Manuels,
Minister of Water and Environmental Affairs, Minister Molewa,
Chairperson of the Parliamentary Portfolio Committee of Energy and members of the committee,
Chairperson of the Select Committee on Economic development and members of the committee,
Representatives from Labour and Business Constituencies,
Our international speakers and guests,
Director-General of the Department of Energy,
Chairpersons of State Owned Entities and Government Agencies,
Chief Executive Officers of State Owned Entities and Government Agencies,
Officials from Government Departments,
Ladies and gentlemen.
We have gathered today, during an important month i n our country’s history where we celebrate human rights. South Africa’s Human Rights Day, 21 March – declared International Day for the Elimination of Racial Discrimination by the UN – is synonymous with a historic township, Sharpeville.
For many South Africans, the day will always remain Sharpeville Day, a commemoration of the 21 March 1960 Sharpeville massacre, where the police of the apartheid regime brutally exterminated 69 unarmed people and injured 180 others who refused to carry the hated ‘dompas’ identity document that was meant only for indigenous Africans. During this month, we do not only celebrate but we remind ourselves of the continued struggle to ensure that every citizen’s human rights arerespected and protected regardless of their race, gender or creed. It is an ideal that this government is committed to.
Ladies and gentlemen, let me remind you that in recognition of the importance ofenergy to sustainable development, the General Assembly of the United Nations declared 2012 as "the international year of sustainable energy for all". The UN made this declaration in recognition of the fact that access to affordable modern energy services is essential for overall sustainable global development, and for the achievement of the Millennium Development Goals.
The General Assembly’s Resolution 65/151 called on the Secretary-General to organise and co-ordinate activities to be undertaken during the year 2012 in order to "increase awareness of the importance of addressing energy issues, including modern energy services for all, access to affordable energy, energy efficiency, and the sustainability of energy sources and use at a local, national, regional andinternational level." In recognition of this declaration we declared the month of March as "Energy Month" and launched this initiative at the beginning of the month in Cape Town. Since the launch, we also embarked on various activities and events with different stakeholders throughout the country.
During "Energy Month" our objective was to engage role players and stakeholders withi n the energy sector to collecti vely work towards the goal of achieving sustai nable energy for all, and to achieve the three (3) defi ned objectives by 2030. These objectives are as follows:
- To ensure uni versal access to modern energy services;
- Reduce global energy i ntensity by 40 percent; and
- Increase renewable energy use globally to 30 percent.
What these objectives imply, ladies and gentlemen, is that at a global level, over the next twenty (20) years we need to double the rate of improvement in energy efficiency. It also means that we need to double the share of renewable energy in the global energy mi x over the same period. However, at a global level this figure does not mean much and we need to understand improvements in energy intensity that can be made within individual demand sectors within specific countries.
Programme Director; ladies and gentlemen, South Africa is making its contributions to the United Nations’ (UN) call to increase access to modern energy services through various initiatives, such as:
- The Solar Water-heating programme
- The roll-out of Integrated Energy Centres together with our partners
- Promoting the use of LPG for cooking and space heating in households by regulating the maximum price and
- Development of the solar park project i n the Northern Cape.
While our efforts to eradicate poverty are applauded, let me remind you that about1.3 billion people around the world are without access to electricity, some 85% of which are living in rural areas and about 2.7 billion without clean cooking facilities.
In Sub-Saharan Africa the electrification rate is around 31% and the number of people relying on the traditional use of biomass is 80% - this is where the greatest challenge lies. Ladies and gentlemen, we must realise that if energy poverty continues, health advances will stall if clinics cannot refrigerate vaccines and medicines. Education cannot flourish in its core purpose if studying at home in the evening is impractical for a majority of our young people, nor can it achieve itsbroader objectives if computers and televisions remain the stuff of dreams.
In all this, women continue to bear the burden of energy poverty. For example, hours of valuable time are lost to the task of wood fuel collection, whilst smoke from the cooking process endangers health. This also undermines environmental goals of minimising deforestation. This primitive cooking method directly confronts the Millennium Declaration’s vision of women’s equality and empowerment.
Programme Director, the number of people relying on the traditional use of biomass is projected to rise from 2.7 billion today to 2.8 billion in 2030. Furthermore, the World Health Organisation estimates, household air pollution from use of biomass would lead to over 1.5 million premature deaths per year, over 4000 per day, i n 2030; and this is greater than estimates for premature deaths from malaria, tuberculosis or HIV/A IDS.
Ladies and gentlemen, addressing these inequalities depends upon all of us recognising that the projected situation is intolerable, a commitment to effect the necessary change, and set targets and indicators to monitor progress.
We are and will continue to work tirelessly with business and industry in informing the long term policy objectives and implementation which will bear testimony to our commitment to eradicate energy poverty and move to the green economy path.
The publishing of the Integrated Resource Plan 2010 and its subsequent implementation; the development of an Integrated Energy Plan and Energy Efficiency Regulations; as well as the review of the Renewable Energy policy are just but some of our attempts to ensure that our energy policies will go a long way in changing our country’s future energy landscape.
Ladies and gentlemen, we acknowledge that throughout our history, South Africa’s energy resources have laid the foundation for our Nation’s economic security and prosperity, powering our factories and mines. Since the ANC government took power in 1994, lighting our classrooms, and increasing energy access to our clinics and homes have been accelerated. However, there are stillchallenges that require bold and decisive action from all the stakeholders i n the energy sector.
This is the reason that the ruling party made a resolution on Energy Security: which states that we must "ensure security of supply of energy resources, and pursue an energy mix that includes clean and renewable sources to meet the demands of our fast growing economy without compromising our commitment to sustainable development".
Programme Director, today we stand at a critical juncture. As global demand forenergy recovers, South Africa must take bold and decisive actions to create a more secure energy future, accelerate access to energy, reduce greenhouse gas emissions and build a competitive 21st century clean energy economy while contributing towards employment creation. (Minister Molewa, you and I share many common challenges as your role is to drive the country towards minimising factors that have a negative on the environment as well as climate change. It is also to ensure that we use our scarce water resources responsibly. As your Department has stated, the energy sector currently contributes approximately 80% towards total emissions).
The global energy sector is still facing significant uncertainties that are being fostered by the threat of default in some countries within the Eurozone as well as the impending sanctions on Iran.
Ladies and gentlemen, the challenges that confront the energy sector have escalated the importance and urgency of Integrated Energy Planning. In 2009, President Zuma in recognition of the importance of national planning established the National Planning Commission headed by Minister Manuel. (Ladies and Gentlemen, you heard Comrade Manuel talk about the importance of national planning and the role that National Development Plan pays i n paving our country’s future landscape). Integrated planning is important at both the national level as well as at the economic sector level.
Programme Director, Alan Lake in the author of "How to get control of your time and your life" once said that "Planning is bringing the future into the present so that you can do something about it now". This quote captures the essence of what the Integrated Energy Plan or the IEP, as it is commonly referred to, seeks toachieve. The last IEP was developed and published in 2003 and we have already begun putting together a framework for the development of the IEP 2012.
The development of the Integrated Energy Plan should happen within thebroader national framework that has been defined in the National Development Plan; and it must also take into account the targets and constraints that are presented by the macroeconomic and global environment.
The Integrated Energy Plan will provide a roadmap of the future energy landscape for South Africa and guides future energy infrastructure investments and policy development. It must take into account all viable energy supply options; and guide the selection of the most appropriate energy carriers and technologies to meet various energy services. This means that we must ask ourselves questionssuch as " whether using electric stoves for cooking and electric heaters for warming our rooms are the best and most efficient application of energy or whether using gas stoves and heaters are more appropriate and efficient applications.
The IEP must also bring together and integrate the outputs from the Integrated Resource Plan and work which is currently being done on the Liquid Fuel Roadmap. Key gaps and areas of alignment between these two plans must be addressed in the IEP and one particular gap that comes to mind is the role that gas can play not only in the generation of electricity, but also as an alternate fuel in meeting household and industrial energy needs.
Ladies and gentlemen, the development of the Integrated Energy Plan must be done in such a way that it takes into consideration a balanced view of the social, environmental and economic development issues that we need to deal with in our beloved country. We acknowledge that achieving these three objectives simultaneously is no easy task as it entails juggling competing and oftentimes conflicting objectives. The recommendations of the IEP must put forward policy options which attain the underpinning objective of ensuring energy security. However, i n so doing other objectives also need to be considered.
The IEP must therefore propose combinations of electricity generating and oil refining technologies and primary energy sources that emit low levels of greenhouse gases and thereby minimising environmental impacts. Natural gas,both conventional and unconventional forms, need to be seriously considered as they are characterised by lower emissions than both coal and crude oil. The shale gas potential i n South Africa cannot be ignored as it has the potential to contribute significantly to economic development through primary and secondary job creation. It can also play an important role i n contributing towards the production of energy within the constraints of proposed emissions caps and thereby helping us in effectively moving towards a low carbon economy. We are cognisant of the controversies associated with shale gas extraction processes such as ground water and soil contamination, however with technology development one can hope that these obstacles will i n the not so far future come to pass.
Programme Director, others have touted that although the exploitation of shale gas displaces fossil fuels, it also has the potential to slow the development of renewable sources due to its low carbon content and low costs. We should shy away from these narrow interests in particular technologies as we have said many a time and continue to reaffirm that renewable energy and by inference renewable energy technologies will play a very prominent role in the future South Africanenergy mix. However at the same time, we should consider policy options that will ensure that we effectively exploit our indigenous energy resources, especially those which we have i n abundance.
Ladies and gentlemen, the IEP should make recommendations which promote technologies that spare the use of our scarce water resources. The technologies proposed must be accompanied by policy options which will encourage localisation and technology transfer.
In order to start moving towards the UN objectives of reducing the global energy intensity by 40 percent by 2030, we must use innovation and technology to establish mechanisms of performing the same tasks and producing the same output using less energy, put differently this means that we should use innovation to do more with less. I believe that through concerted efforts to make improvements in processes and technologies, this is achievable in all economic sectors, moreespecially in the industrial sector. In measuring whether we have become a more efficient economy, we must bear in mind the structural factors that may disguise real efficiency improvements i n our processes. We therefore should not only monitor energy efficiency improvements at an economy-wide level by comparing energy consumption against GDP, but should also zoom in to specific sectors and industries
Ladies and gentlemen, I must also emphasise that as a developing economy and in support of our objectives of job creating and labour absorption, our energy intensity measures should be accompanied with labour intensity measures so that we do not undermine efforts to increase employment. It will not help us as a nation, to reduce the energy intensity of our economy, while jobs are being lost and less employment being created through initiatives to improve energy efficiency. We should also not discourage future investments i n value-creating industries that still depend on energy intensive technologies if such industries contribute to the other competing objectives of job creation and localisation.
Ladies and gentlemen, it is important that proposed technologies will ensure that our citizens derive maximum benefit and we minimise the overall cost of energy to the economy and to our people.
The Integrated Energy Plan needs to answer critical questions, some of which are as follows:
- Given current policies and legislation, what is the most optimal energy mix that will ensure South Africa achieves security of energy supply at the minimum cost to the economy, while simultaneously minimising emissions and water usage?
- Assuming more people will continue to drive liquid fuelled vehicles as their primary means of transport well into the future, what is the best way of ensuring security of liquid fuel supply i n the country?
- What impact will long-term policies within the energy demand sectors such as the transport, housing and industrial sectors have on future energy demand patterns and how should the energy sector respond?
- By how much and where in the energy value chai n can we introduce efficiencies?
- What impact do environmental constraints (e.g. emission caps and carbon taxes) have on the choices of energy producing technologies we make and what are the cost implications of such choices?
- What impact will long-term transport policies to encourage modal shifts from road to rail and from single transit to mass transit have on future transportation technologies? What impact will this in turn have on future transport demand patterns and how should the energy sector respond?
- To what extent does regulating prices of alternative energy carriers such as Liquefied Petroleum Gas (LPG) impact on electricity consumption patterns and therefore encourage consumers to switch to these alternatives?
However, ladies and gentlemen, I am sure each and every one of you has a burning question that you believe the IEP should address. While all questions are important, it will not be possible for all policy questions to be addressed through the IEP. Let us use the next two days as a platform for constructive dialogue wherein we discuss the most critical questions that should be addressed. We have invited subject matter experts and speakers from industry, academia, government, local and international organisations and agencies to enrich the discussions. This will, however, not be our last engagement as once we have finalised the draft report we will embark on broader nationwide road shows wherein we will consult all the members of the public.
Programme Director, the 2003 IEP highlighted the importance of good qualityenergy data for energy planning, particularly when conducting technical analysis using the model. We hope to have the cooperation of all stakeholders and role players to provide us with the relevant data as requested to inform the IEP 2012. I am pleased to also announce that on the 1st of March we promulgated theRegulations on the Provisions of Energy Data. These Regulations make it mandatory for certain categories of data providers across the energy value chain to submit energy data to the Department when requested. The objective of this is to enable the department to collect essential data about the energy sector, which will enable us to conduct evidence-based analysis for better policy formulation andplanning. It will also enable us to provide more reliable information and statistics to you, our citizens, as well as investors and other key decision-makers locally and internationally alike.
In conclusion, I am encouraging all of you here today to realize the urgency and importance of engaging in a dialogue that can contribute positively to the development of the Integrated Energy Plan for South Africa. As Government, the output of our work is enriched by stakeholder input as it forces us to consider a multitude of factors and weigh out different options before coming up with the final recommendations.
Thank you and I hope that the next two days will see fruitful discussions that willculminate into clear outcomes for the IEP.
