AUW 2012: We've got the power?

FREEZING

Yesterday, my colleague Penny Goodwin and I had the pleasure, amid the chattering of teeth and beset by a constant need to reflect on weather conditions... the second day of African Utility Week at the Nasrec exhibition centre, south of Johannesburg. 

The freezing wind and total absence of heating inside the Opening Ceremony hall (which opened a half hour late) aside, we at last had the opportunity to hear from the horse's appointed spokesperson's mouth in what direction the Department of Energy (DoE) is headed in terms of SA's 'sustainable' energy mix.

MINISTER MISSING IN ACTION

With Dipuo Peters waylaid in Parliament with President Zuma amid slightly better Cape Town weather yesterday, DoE COO, Thandeka Zungu, read the Minister's speech - to her credit, with a lot of eye contact and personal anecdotes thrown in for good measure.

Coincidentally, in Parliament yesterday morning, the Minister committed to address copper theft (worth R100 million p.a.) by drawing in the SAPS through ensuring an amendment to Second-Hand Goods Act towards tougher disciplinary measures against buyers of this cable.

NUCLEAR CERTAINTY

 Surprisingly, she started her speech talking NUCLEAR - specifically to confirm that the DoE is going ahead with its plans to ramp up nuclear power capacity to 9.6GW (the equivalent of two Medupi coal power stations) by 2030 as planned – disregarding the 11.4GW figure recently quoted by her Department.The international service providers-in-waiting for the tender announcement in November best keep their pocket calculators handy!  This in accordance with SA's Integrated Resource Plan, approved just six days after the Fukushima disaster in March 2011.  

Ms Zungu said the ill-named National Nuclear Energy Executive Co-ordination Committee (NNEECC), headed up by our very own Deputy President, would oversee the nuclear programme - at this stage, it is unclear whether they have to answer to Parliament on their decisions...It is thus what role division exists between NNNEECC and NECSA the SA Nuclear Energy Corporation), which just received a further R50 million in the budget vote to be in charge of developing viable nuclear fuel cycle operations for our beloved country.

UNDER-SERVICED COMMUNITIES

She also spoke about the Integrated National Electrification Programme (INEP) – the backbone for supplying under-serviced communities, rural areas, new formal / informal urban settlements with power. 

Eskom, working with municipalities (hampered by a lack of technical and managerial skills to handle this), had nevertheless completed 220 000 connections as at January 2012.  Eskom had 42 infrastructure projects funded, mainly in KwaZulu-Natal and the Eastern Cape, while the municipalities had 45 projects funded. 

Eskom had been allocated R1.8 billion while the municipalities received R1.1 billion for 2012/13 - according to their web page. Ms Zungu's total was a R3.2 billion allocation for the coming year - but I guess R300 million is not too large an accounting err?

The worst INEP electrification backlogs exist in KZN, the Eastern Cape and Limpopo - which is being addressed by the commissioning of an additional 450,000 home solar system installations by independent service providers (mainly geysers) - 250,000 have been installed to date and the 2014 target is 1 million geysers. 

They're running into the problem, though, of recipients believing that they are receiving inferior power solutions by their malevolent government. Government is also not happy with the fact that most of these low-pressure geysers have been imported, and they'd like to see local production, which Ms Zungu said would attract Government-funded subsidies.

Further down the electrification road map, Ms Zungu reported on the recent National Electrification Indaba in Durban during March, held in line with the United Nations “Access to energy” campaign. Here, all stakeholders discussed the dilemma of having 90% of the country electrified (pun excused), as planned, by 2014. She did not mention any solutions... a 75% backlog exists in rural areas. 

There's also been an outcry from municipalities on the inequitable funding of electrification projects because Eskom got funding for the connections but municipalities did not. 

Compounding this, municipalities have to adhere to conflicting legislation. Funding is only effectively available from 1 July, meaning that they effectively have nine months to do the work unless they can get bridging finance, which in any case would put them in non-compliance with the applicable legislation. 

Obviously, the Municipal Finance Management Act 2003 procurement process needs serious review. Something Ms Zungu says is being addressed.

We have yet to ascertain the success of Project ADAM, a pilot with municipalities and Eskom  to ascertain the state of the electricity distribution industry in SA. Some systems are older than 40 years, and ADAM will prioritise which need changing and who is responsible.

She closed by saying that energy efficiency measurement was a top priority in 2012, to enable the DoE to better allocate needs and electricity supply blocks.

My next post will be on yesterday's host speaker: Brian Dames of Eskom.