Government has put forward growth strategies to further develop our infrastructure for the broader benefit of the country.
The electricity supply speaks directly to our initiatives of strengthening the economy.
Electricity supply is the pulse of the nation - business and citizens depend on electricity for trade and their daily personal activities. We want to grow the economy, and we want to create jobs for our people.
A reliable, secure supply of electricity is therefore critical – we saw the impact of electricity shortages on business and the economy as a whole in 2008.
The Department of Public Enterprises (DPE) remains resolute that the country should never go through another period of painful, rotational load-shedding as experienced in the past.
Therefore the prudent use of electricity by all South Africans, including households, industry, government and business, will assist us in this regard.
Eskom will, in turn, continue to improve its generation fleet operational performance, reduce transmission and distribution system losses, improve its internal energy efficiency initiatives, as well as its demand side management programmes, while ensuring that the timeous delivery of the Build Programme is not compromised.
There is a lot of work being done by the Inter-Ministerial Committee on Energy and the task teams set up to oversee this process. We are confident that this work will yield the desired outcomes necessary to ensure that security of electricity supply is maintained.
As a Department we believe that we should be transparent and honest with South Africans.
The reality is that Eskom faces a challenge during the generation maintenance season up until mid-May 2011. There is not enough of a window to do the necessary levels of maintenance required to ensure that the winter peak electricity demand can be sustained.
Furthermore, the system will be even more vulnerable owing to the fact that Koeberg Unit 2 will be out of service for a period of 57 days from mid-March 2011 for refurbishment and refuelling. The failure of the Duvha Power Station unit 4 has also affected the generation maintenance schedule.
Although Eskom has initiatives in place to ensure that there is an adequate reserve margin (such as, imports from the Cahora Bassa, capacity from the Medium Term Power Purchase Programme (MTPPP), municipal generation and accelerated demand side initiatives), the prevailing challenge will be the ability to provide adequate maintenance windows for Eskom’s generation fleet to ensure pro-active assurance of plant performance.
Energy efficiency will therefore play a very critical role in ensuring the security of electricity supply going forward.
Funding for current build programme
As you are aware, government has shown its full support for Eskom in its efforts to ensure that there is adequate capacity to meet electricity demand going forward. Government has provided a subordinated loan of R60 billion, further guarantees to the tune of R350 billion have been provided to ensure that Eskom can secure the necessary funding to complete the approved build programme.
Integrated Resource Plan
Last month Cabinet approved the final version of the Integrated Resource Plan, which is a long term electricity capacity plan which defines the need for new generation capacity for the country. A total of 42 percent of all new electricity generation will be expected to come from renewable energy over the next 20 years. This is a significant increase from the 30 percent of new generation assigned to renewable energy under the draft IRP released for public comment last year.
Under the approved IRP2010, coal is now expected to make up 15 percent of all new energy generation, open cycle gas turbines (OGCT) 9 percent, hydro 6 percent , imported gas 6 percent , while nuclear will make up 23 percent.
Nuclear power
Given that the envisaged nuclear programme is the first nuclear roll-out programme in South Africa since Koeberg in the 1970s, it is important that the necessary groundwork be facilitated timeously and effectively in anticipation of construction of nuclear plants over the IRP2010 period. In this light, Government is currently involved in a process to evaluate, among others, the technology options, funding, governance, regulatory and safety issues associated with the nuclear programme.
Coal
Eskom has made significant progress in implementing the coal supply strategy it has put in place over the past three years and it is looking at options to ensure security of supply for its power stations over the long term. Current coal stockpiles are at an average of more than 40 days and approximately 95% of Eskom’s requirements to 2018 have been contracted or committed. Rail volumes have been increased and quality management practices and contractual provisions have been improved.
49 Million Campaign
Together with Eskom, we have rolled out an “Energy SAVE IT” campaign, which provides information to the public on how best to save energy. The “Save It” campaign was a precursor to a social mobilisation campaign called the “49 Million campaign”, whereby Government and Eskom are appealing to the power of 49 million South Africans to save energy. The “49 Million campaign” is a partnership between Government, Eskom, business and key stakeholders.
But, the most important partner is each South African playing their part to realise the objectives of the campaign.
The “49 million campaign” is a call to action to reduce electricity consumption. It is geared at mobilizing all South Africans to keep the lights on, save money and the environment.
The high levels of inefficient use of electricity in all sectors of the economy can no longer be accepted. Increasing the efficiency of appliances, ventilation, heating and cooling equipment, improving operations and maintenance, energy efficient new buildings and retrofitting are just some of principles employed in energy efficiency.
In industry, notable savings have been achieved through installing more efficient motors and chillers, fans and insulation. Both industry and business are encouraged to intensify their energy efficiency initiatives.
Households can also play a huge role in energy savings and are urged to install solar water geysers, use energy efficient lighting and switch off all appliances not in use - “If you are not using it….switch it off”.
That uncomplicated message to individuals is one of the simplest solutions to complex challenges that face the country regarding electricity.
The Department is leading a programme to brief business, labour, Cabinet and other stakeholders about this challenge to our electricity system, to mobilise them to play a conscious and vigorous part in the campaign.
In this regard, the Department and I, as the Minister, are receiving daily updates – by email and sms – and are hence daily monitoring the situation so that we can make the necessary interventions should the need arise.
I trust we shall heed all the call for efficiency and prudent usage of electricity.
I thank you
Source: Department of Public Enterprises
