2010 – 11 mtef strategic plan(91p)

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  • 1. 2010 – 11 MTEF STRATEGIC PLAN PRESENTATION TO THE SELECT COMMITTEE ON ECONOMIC DEVELOPMENT Presentation by : Ms N Magubane Director General 13 APRIL 2010 1
  • 2. DOE TEAM AND PRESENTATION OUTLINE • Team Presentation • What informed out strategic plan • Programme 1 - Administration • Update on the split of the DME • Programme 2 – Hydrocarbons and Energy Planning • Programme 3 – Electricity, Nuclear and Clean Energy • Budget allocation • Conclusion 2
  • 3. WHAT INFORMS OUR STRATEGIC PLAN? • Government priorities • State of the Nation Address • National Budget Speech • Budget Vote Speech • 2010 Cabinet Lekgotla’s Resolution • Sector specific challenges 3
  • 4. WHAT INFORMS OUR STRATEGIC PLAN? (CONT.) • Government priorities: – Creation of decent work and sustainable livelihoods – Education – Health – Rural development, food security and land reform – The fight against crime and corruption 4
  • 5. WHAT INFORMS OUR STRATEGIC PLAN? (CONT.) • State of the Nation Address – Over the next 3 years Govt. will spend R846 billion on public investment. – Establishment of the Inter-Ministerial Committee on Energy, to develop a 20 year Integrated Resource plan – Participation of Independent Power Producers and protecting the poor from rising electricity prices. – Establishment of the Independent System Operator, separate from Eskom 5
  • 6. WHAT INFORMS OUR STRATEGIC PLAN? (CONT.) • National Budget Vote Speech – Climate change and global energy supply – Protection of the poor from rising cost of electricity – Public sector investments 6
  • 7. DoE BUDGET SPEECH - 2009 • Review of the national strategic fuel stocks policy (31 March 2010) • Development of an Integrated Energy Plan – (31 March 2010) • Review of the fuel standards and specifications – ( June 2010) • Establish South African National Energy Development Institute ( 31 March 2010) • Review of the Liquid Fuels Charter (31 March 2010) 7
  • 8. DoE BUDGET SPEECH - 2009 • Establish the National Radioactive Waste Disposal Institute (31 March 2010) • Conversion of the SAFARI reactor from using Highly Enriched Uranium to Low Enriched Uranium by NECSA (30 September 2009) • Promotion of the energy mix - Independent Power Producers (30 August 2009) • Roll-out of one million solar water heaters in households and commercial buildings over a period of five years. 8
  • 9. DoE BUDGET SPEECH - 2009 • Formalise engagement with the Clinton Foundation, to facilitate the development of an Industrial Energy Park concept, focussing on concentrated solar power (31 March 2010) • Establishment of the National Radioactive Waste Disposal Institute ( 31 march 2010) • Commissioning of the 400 MW of wind power through the independent power producers, over the next three years (31 March 2012) • Gazetting and/or publishing of the integrated resource plan or country. 9
  • 10. DoE BUDGET SPEECH - 2009 • Displacement of 2% of crude oil based fuels with bio-fuels. • Develop an appropriate pricing policy framework to structure our tariff regime such that the indigent sections of our communities are insulated from increasing electricity tariffs. • Launching of the rural electrification projects, Engcobo, Inxuba Yethemba &, Umhlonhlo that will ensure R 170 million investment in the infrastructure development of Chris Hani and Alfred Nzo District municipalities (30 September 2009) 10
  • 11. JANUARY CABINET LEKGOTLA RESOLUTIONS 2010 • Integrated infrastructure plan • Implementation of the industrial policy • 2010 FIFA World Cup – progress, challenges and interventions required • Inter - cluster activities 11
  • 12. OBJECTIVES OF ENERGY SECTOR • Increasing access to affordable energy services • Improving energy governance • Stimulating economic development • Managing energy – related environmental and health impacts • Securing supply through diversity 12
  • 13. PRESSURES FACED BY THE SECTOR Energy International security cooperation Access to energy Climate change (Clean energy) Poor economic Skills and regulation Energy sector capacity Demand Diversity of management supply Upward Safety pressure on cost of energy 13
  • 14. DEPARTMENT OF ENERGY STRATEGIC PLAN 2010/11 14
  • 15. TABLE OF CONTENTS • Introduction • Strategic Overview and Objectives • Organizational environment • Policy Development • Key Focus Areas • Resource plan • Conclusion 15
  • 16. MANDATE & MISSION The revised mandate, mission and vision of the DoE: MANDATE – Ensure secure and sustainable provision of energy for socio-economic development MISSION – To regulate and transform the sector for the provision of secure, sustainable and affordable energy 16
  • 17. VISION In line with government’s planning for both medium and long term, we developed visions for both horizons VISION 2014 – A transformed and sustainable energy sector with universal access to modern energy carriers for all by 2010 VISION 2025 – Improving our energy mix by having 30% of clean energy by 2025 17
  • 18. DoE STRATEGIC OBJECTIVES Our strategic plan seeks to deliver results along the following eight strategic objectives: • Ensure energy security. • Achieve universal access and transform the energy sector. • Regulate the energy sector. • Effective and efficient service delivery. • Optimal utilisation of energy resources. • Ensure sustainable development. • Enhance DoE culture, systems and people. • Promote corporate governance. 18
  • 19. ORGANISATIONAL ENVIRONMENT • Budget split – 30/70 between DoE and DMR for support services – although functions have been duplicated. • Impact of lesser budget – an interim ‘establishing’ structure that ensures all critical positions to establish a new department are filled immediately. • Co-operation of SOEs – assistance with setting up of the new department. • First phase of capacitating DoE completed – i.e matching and placement of DME personnel. 19
  • 20. ORGANISATIONAL ENVIRONMENT • Second phase – advertising and filling of vacant posts has started, plans to complete by end of the first quarter. • Additional capacity to be obtained with the mid- term adjustments later in the year. • Line function has maintained the two branches of Hydrocarbon and Energy Planning and Electricity, Nuclear and Clean Energy. • Plans for gradual increase of the line function capacity to realise the full structure of the new DoE by end of the MTEF. 20
  • 21. POLICY DEVELOPMENT Legislative focus for this year: • The Seventeenth Constitutional Amendment Bill. • The REDs establishment Bill – establish efficient regional electricity distributors. • The Electricity Regulation Amendment Bill – appropriation of land for electricity infrastructure, provision for the establishment of ISMO. • New Generation/IPP Regulation – provision of regulatory intervention to level the playing field in the electricity generation sector. 21
  • 22. POLICY DEVELOPMENT Legislative focus for this year: • The Petroleum Products Amendment Act, 2003 – address non-compliance in the liquid fuels sector. • The National Energy Act, 2008 – empowers the Minister of Energy to execute certain initiatives to achieve security of supply, develop regulations for the provision of energy data, etc. • Review of the fuel specification regulation – to advance to higher and cleaner fuels. 22
  • 23. CONCLUSION PROGRAMME SPECIFIC PRESENTATIONS TO FOLLOW THANK YOU 23
  • 24. 2010/11 MTEF STRATEGIC PLAN PROGRAMME 1 ADMINISTRATION PROGRAMME 4 STATE OWNED ENTITIES Mrs. T.N Zungu 24
  • 25. PROGRAMME FOCUS AREAS SUPPORT SERVICES (Programme 1) • Main focus is on the establishment of the new department – operational structures, capacity and provision of skills. • Setting up of governance structures – internal audit functions, audit committee, risk management and fraud prevention, procurement and finance committees, etc. • Review of the international agreements – aligning them to government’s objectives. 25
  • 26. PROGRAMME FOCUS AREAS SUPPORT SERVICES (Programme 1)cont • Communication strategy – profiling the department as the custodian of the country’s energy security. • Strengthening our SOE oversight function – improving processes, alignments and capacity. • Finance – complying with financial legislation from day 1. 26
  • 27. PROGRAMME FOCUS AREAS SUPPORT SERVICES (Programme 1)cont • Communication strategy – profiling the department as the custodian of the country’s energy security. • Strengthening our SOE oversight function – improving processes, alignments and capacity. • Finance – complying with financial legislation from day 1. 27
  • 28. SOEs REPORTING TO THE ENERGY MINISTER • Research and Development – CEF (PTY) Ltd – CEF group of companies made up of entities with commercial, strategic, licensing and developmental roles. Has 5 operating subsidies. Involved in the search for appropriate energy needs of SA, SADEC and Sub-Saharan Africa region. – NECSA – promotes research and development in the field of nuclear energy and radiations science. 28
  • 29. SOEs REPORTING TO THE ENERGY MINISTER Regulators • National Energy Regulator of SA (NERSA) – responsible for the issuing of licenses, setting and/or approving tariffs and prices, monitoring and enforcing compliance with license conditions. • National Nuclear Regulator (NNR) – regulates the diverse activities in the nuclear sector, protect persons, property and environment against nuclear damage. 29
  • 30. SOEs REPORTING TO THE ENERGY MINISTER Other • EDI Holdings – restructuring of the existing electricity distribution entities into 6 financially viable Regional Electricity Distributors (REDs). 30
  • 31. SOEs REPORTING TO THE ENERGY MINISTER • Research and Development – CEF (PTY) Ltd – CEF group of companies made up of entities with commercial, strategic, licensing and developmental roles. Has 5 operating subsidies. Involved in the search for appropriate energy needs of SA, SADEC and Sub-Saharan Africa region. – NECSA – promotes research and development in the field of nuclear energy and radiations science. 31
  • 32. SOEs REPORTING TO THE ENERGY MINISTER Other • EDI Holdings – restructuring of the existing electricity distribution entities into 6 financially viable Regional Electricity Distributors (REDs). 32
  • 33. SOE OVERSIGHT Introduction • SOEs are the extended arm of government and need to advance government priorities. • SOEs are established as instruments of socio- economic advancement. • SOEs should have the means to contribute to the improvement of the standard of living of the citizens of our country – create sustainable economic and social benefits. 33
  • 34. DOE OVERSIGHT ROLE • Alignment of strategies and plans - • Ensure the balance between government priorities and commercial priorities of these entities. • Shareholder board appointments • Board participation by departmental representatives • Monitoring and evaluation of entities’ performance • Oversight on the electrification programme – as defined in the Division of Revenue Act. Applies to both Eskom (schedule 7) and the Municipalities (schedule 6) 34
  • 35. TRANSFERS TO SOEs 2010/11 Transfers: ENTITY AMOUNT PROGRAMME 1. NECSA R574,1m Capex R10,7m Operational budget R554m 2. NNR R20m Operational budget 3. EDIH R61,6m Operational budget 4. INEP R2,808bn Electrification programme TOTAL R3,463bn 35
  • 36. CONCLUSION In conclusion, we want to invest in building a formidable TEAM ENERGY that is able to effectively discharge our responsibilities, serve the masses of our people and make a difference in their lives. 36
  • 37. THANK YOU 37
  • 38. UPDATE ON THE SPLIT PROCESS Mr G Mnguni 38
  • 39. BACKGROUND/OVERVIEW  May 2009 – President announced the split of DME into two departments; viz Department of Energy and Mineral Resources;  National Macro Organization Steering Committee (NMOS) was established to oversee the process of re-organizing government departments;  Various work-streams were formed to focus on specific functions such as, Organizational Scoping HR audits, Change Management and Communication,; Labour and Legal Services; Infrastructure and Assets; ICT; Finance and Budgets.  An internal steering committee for the split was established and work stream leaders were appointed; and  A consolidated transitional plan was compiled and progress reports by Work streams are being submitted to the Departmental Steering Committee every second week. 39
  • 40. UPDATE ON THE SPLIT  Departmental structures have been designed and approved by both Executing Authorities (i.e. Ministers);  Allocation of funding for newly created positions has been obtained, but for critical posts only; and  All new positions in Support Services have been job profiled and evaluated. 40
  • 41. UPDATE ON THE SPLIT  The matching and placement of all employees was finalised on 12/03/2010;  Formal placement of all employees on separate Persal systems was finalised on 15/03/2010 ( DOE & DMR );  Budget systems were posted on 23/3/2010 and the first & successful test salary run was done on the 02/04/2010; and  Reports are continuously generated and any anomalies between BAS and Persal are being attended to prior to the 15/04/2010. 41
  • 42. UPDATE ON THE SPLIT  Recommendations for placement has been considered by both DGs and approval for placements has been given;  Formal placement letters have been issued to all affected employees in Support Services;  Confirmation/acceptance of placements are being done in writing;  In cases where people are not satisfied with the results of the placement, an appeal process will commence; and 42
  • 43. UPDATE ON THE SPLIT  All vacant (funded) positions are being advertised in the National media in line with the Public Service Regulations;  All employees that have been placed in both Dept, are eligible to apply for higher/ lateral transfers; and  Advertising of positions is being done in line with the departmental Recruitment and Selection policy. 43
  • 44. UPDATE ON THE SPLIT  Both Departments have been created on Persal;  Identification and grouping of HR Administration activities for both Departments was finalised by 31 March 2010 and implemented on 1 April 2010 (e.g. Service benefits; leave; Medical Aid Schemes; Subsidies; etc);  A Review of the current DME HR Plan was commenced on 1st April 2010 and will be finalised by end of June 2010; and  A Review of the current HR Policies, practices and delegations will also commence w.e.f 1 April 2010 and finalised by end of May 2010. 44
  • 45. THANK YOU 45
  • 46. 2010/11 MTEF STRATEGIC PLAN PROGRAMME 2 HYDROCARBONS & ENERGY PLANNING Mr. T. B Maqubela 46
  • 47. PROGRAMME FOCUS AREAS Hydrocarbons and Energy Planning • Integrated Energy Planning Strategy – provision of an integrated energy plan that recognises the interdependence of all forms of energy, by the end of the year. • Fuel specifications & standards • LPG price regulation – support greater use of LPG for thermal purposes. • Biofuels pricing framework – development of a framework to guide the implementation of the biofuels strategy to expand the biofuels market. 47
  • 48. POLICY DEVELOPMENT • The Petroleum Products Amendment Act, 2003 – improved governance of the petroleum sector. • Review Charter that is annexed to the Act; provide waivers i.r.o. fuel specifications; etc. • 2010/11: Approval for public consultation • The National Energy Act, 2008 – to enable integrated energy planning and ensure energy security • 2010/11: Will commence with promulgation of Regulations for mandatory provision of data. • Review fuel specification & standards – Roadmap for tightening of specs and standards for cleaner fuels in pursuance of improved SHEQ • Opposition by oil majors 48
  • 49. PROGRAMME FOCUS AREAS • Integrated Energy Plan (IEP) – to develop integrated short-, medium- and long-term plans for the energy sector in South Africa taking into cognisance the convergence of energy carriers, plethora of technologies and that energy exists everywhere • LPG price regulation – support greater use of LPG for thermal purposes. • Biofuels pricing framework – to guide and enable the implementation of the Biofuels Strategy through appropriate pricing and manufacturer assistance mechanisms • Strengthen monitoring and enforcement of compliance 49
  • 50. PROGRAMME FOCUS AREAS – (CONT.) • Review of the Liquid Fuels Charter – to usher in a new empowerment dispensation for the Liquid Fuels industry • Revision of Strategic stocks policy - framework for the storage of strategic and commercial fuel stocks. • Current economic environment not conducive • Development of an energy modeling system for South Africa as a tool to develop an IEP • Development of an appropriate pricing mechanism of Regulatory Accounting throughout the liquid fuels value chain to promote the appropriate behaviour i.r.o. investments • Develop integrated energy centres (IeCs) – to contribute to the eradication of energy poverty 50
  • 51. GENERAL CHALLENGES • Budgetary constraints • Inadequate support for line function, particularly ICT systems • Personnel; • Data availability • Understanding of energy issues; and • External factors (e.g. energy availability and /or pricing issues that could shift our focus during the year). 51
  • 52. 2010/11 MTEF STRATEGIC PLAN PROGRAMME 3 ELECTRICITY, NUCLEAR & CLEAN ENERGY Mr. O. Aphane 52
  • 53. ELECTRICITY NUCLEAR & CLEAN ENERGY BRANCH • Electricity • Nuclear Energy • Clean Energy • Integrated National Electrification Programme (INEP) 53
  • 54. ELECTRICITY STRATEGIC OBJECTIVES • To create and maintain a secure balance between electricity supply and demand, • To diversify primary energy mix in the new build program, • To create incentives for energy efficiency and demand side management programs, • To create a sustainable electricity distribution industry. 54
  • 55. ELECTRICITY -PROGRAMMES • Integrated Resource Planning • Private sector participation in electricity generation sector. • Energy Efficiency and Demand Side Management Scheme (Standard Offer) • Distribution Asset Rehabilitation • Establish Regional Electricity Distributors 55
  • 56. ELECTRICITY IRP • Electricity supply-demand matching plan for next 20 years. • Plan to provide for diverse technologies and primary energy sources. • Government policy objective for the sector – Mitigate carbon emissions – Supply adequacy – Diversify generations – Imports from neighbouring countries 56
  • 57. ELECTRICITY – PRIVATE SECTOR PARTICIPATION • Introduce private generators (Independent Power Producers) in both fossil fuel and renewable energy. • Enablers: – Establish Independent System and Market Operator. (short-term is a ring-fenced entity within Eskom) – Long term ISMO – introduce legislation to create ISMO as public entity with BoD. – Power Purchase Arrangement risk allocation – Transmission Access Code 57
  • 58. ELECTRICITY – STANDARD OFFER • Rebate linked to energy (kWh) savings. • Independent of technology deployed to achieve savings. • Residential (SWH), Industrial (PCP) and Commercial (Improved Building Insulation) • Linked to other outcomes – (i.e. sustainable job creation) 58
  • 59. ELECTRICITY – DISTRIBUTION INDUSTRY • Intensive network rehabilitation program. • Introduce regulations to ensure sound asset maintenance going forward. • Funded in part from fiscal and in part from tariff. • One of key outcomes – Improve municipalities technical skills. 59
  • 60. ELECTRICITY – DISTRIBUTION INDUSTRY • 17th Constitutional amendment completed. • Regional Electricity Distribution establishment bill. • Establish REDs (wall-to-wall). 60
  • 61. NUCLEAR ENERGY • To improve governance of the nuclear sector, specifically in relation to nuclear safety, nuclear non-proliferation and nuclear technology. • Nuclear Energy Policy, 2008 • Decision regarding new nuclear power plants • Nuclear Fuel Cycle • Regulatory Framework • Skills and Training • Stakeholder engagement and communication • Industrialization and localization • Funding and procurement process 61
  • 62. NUCLEAR ENERGY… • Radioactive Waste Management Policy,2005 – Establish the Disposal Institute • Develop Business Plan and Budget • Appointment of Board and CEO • Transitional Arrangements with Necsa – National Committee on Radwaste Management • Review of Operator’s radioactive waste management plans as per policy 62
  • 63. NUCLEAR ENERGY (CONT.) • Nuclear Security and Non-Proliferation (Nuclear Energy Act) – Develop the Regulations to introduce the Design Basis Threat (DBT) – Development of Nuclear Security regulations 63
  • 64. NUCLEAR ENERGY (CONT.) • Establishment of the African Commission on Nuclear Energy (Africa Nuclear Weapons Free-zone, Pelindaba Treaty, in force July 2009) – AU calling for Conference of State Parties on 15-17 April to address: • Composition of Secretariat • Location of Secretariat – RSA has offered to host • Role and functions of Secretariat • Funding – scale of assessment 64
  • 65. CLEAN ENERGY 65
  • 66. ENERGY EFFICIECNY • Finalization of the Energy Efficiency (2005) – Energy Efficiency Strategy (2005) • A Final Energy Demand Reduction of 12% by 2015, with industrial sector contributing 15% • Review of the Energy Efficiency Accord • Development of the Monitoring and Verification system for Energy Efficiency and Demand Side Management. • Implementation of the – Municipal Energy Efficiency projects – Public Buildings Energy Efficiency Projects • Regulation of criteria for Tax Incentives applicability on energy efficiency to minimize double dipping • Energy Efficiency and Demand Side Management Campaigns to enhance uptake of energy efficiency initiatives. 66
  • 67. RENEWABLE ENERGY • Finalization of the Renewable Energy Policy (2003) – Contribution of 10 000GWh from Renewable Energy sources to RSA energy mix by 2013 • Implementation of the National Solar Water heating Programme to install 1 000 000 by 2014. • Operationalisation of the Working for Energy Programme (WfE) • Implementation of the South African Wind Energy Programme (SAWEP) • Implementation of the Biofuels Strategy • Implementation of Tradable Renewable Energy Certificates (TRECs) • Operationalisation of IRENA engagements 67
  • 68. ENVIRONMENTAL MANAGEMENT AND DNA • Development of the Department’s Environmental Impact Management Plan . • Finalization of the Climate Change Strategy • Support the Commission on Sustainable Development (CSD) led by the DEA • Support the United Nations Framework on Sustainable Development (UNFCCC) led by the DEA • Promotion of DNA to have as many CDM projects registered as possible 68
  • 69. INTEGRATED NATIONAL ELECTRIFICATION PROGRAMME • To manage the electrification planning, funding and implementation process, with the aim of eliminating the electrification backlog so as to reach Universal Access • Our Focus areas – Managing the electrification planning process – Managing the electrification funding allocation process – Managing the electrification implementation process – Monitoring the INEP in line with the Energy White Paper, – the DoRA, PFMA, Electricity Regulation Act, OHS Act etc. 69
  • 70. ELECTRICITY VALUE CHAIN GENERATION Electricity is Generated by burning of fossil fuels (coal, oil, or natural gas), use of 2 TRANSMISSION MUNICIPALITIES nuclear technology SUBSTATIONS and hydro capability 1 TRANSMISSION LINES TRANSMISSION (400/275 kV) 3 POWER STATIONS High Voltage electricity is carried DISTRIBUTION DISTRIBUTION between Generation and required LINES (132/33 kV) Distribution through Transmission networks (or Transmission grids) The distribution networks DISTRIBUTION SUBSTATIONS collect ‘stepped down’ electricity from the transmission networks and deliver it to Redistributors /End Users The voltage levels of electricity are further transformed to meet Distribution requirements SERVICE CONNECTION RETICULATION HV LINE (11 & 22kV) Customer consumption is measured at the point of supply in KWh. This information is 70 RETICULATION LV LINE used to measure and bill consumption (380/220V) levels utilised/sold
  • 71. BACKLOG CLASSIFICATION INFORMAL FORMAL PROVINCE BACKLOG % BACKLOG BACKLOG BACKLOG Eastern Cape 673,694 19.88% 67,369 606,325 Free State 200,633 5.92% 70,222 130,411 Gauteng 715,195 21.11% 572,156 143,039 Kwazulu-Natal 813,315 24.00% 162,663 650,652 Limpopo 340,064 10.04% 51,010 289,054 Mpumalanga 222,755 6.57% 44,551 178,204 North West 192,774 5.69% 48,194 144,581 Northern Cape 49,375 1.46% 17,281 32,094 Western Cape 180,351 5.32% 126,246 54,105 Total 3,388,156 100.00% 1,159,691 2,228,465 71
  • 72. FUNDING REQUIREMENT FOR UNIVERSAL ACCESS BULK FINANCIAL INFRASTRUCTUR REFURBISHMENT/ YEAR CONNECTIONS E REHABILITATION TOTAL PER YEAR 2009-10 R 4,554,560,933 R 1,066,368,279 R 666,018,943 R 6,286,948,156 2010-11 R 4,625,652,151 R 2,087,695,645 R 759,261,595 R 7,472,609,392 2011-12 R 4,698,165,194 R 2,109,449,558 R 865,558,218 R 7,673,172,971 2012-13 R 4,772,128,498 R 2,131,638,549 R 986,736,368.92 R 7,890,503,417 Totals R 18,650,506,778 R 6,465,571,031 R 6,465,571,031 R 29,323,233,937 72
  • 73. MTEF ALLOCATION VOTED FUNDS MTEF 2009/10 MTEF 20010/11 MTEF 20011/12 R’000 R’000 R’000 MUNICIPALITIES 932 957 1 020 104 1 096 612 ESKOM(NATIONAL) 1 467 365 1 751 780 1 873 367 ESKOM (BACKLOGS) 148 950 0 0 NON - GRID 84 000 88 200 92 693 BASELINE 2 633 272 2 860 084 3 062 672 ALLOCATION 73
  • 74. MUNICIPAL PROGRAMME 2009/10 Monthly report as 28 FEBRUARY 2010 Transfers Expenditure Expenditure Allocated Transferred Expenditure Summary by province as % as % as % (R'000) to date to date allocation allocation transferred Eastern Cape 234,300 219,570 95% 129,162 55% 59% Free State 88,456 66,254 76% 54,934 62% 83% Gauteng 82,580 58,106 78% 54,665 66% 94% KwaZulu Natal 123,303 39,613 33% 28,396 23% 72% Limpopo 139,761 114,745 82% 69,483 50% 61% Mpumalanga 98,436 89,562 95% 33,640 34% 38% Northern Cape 28,675 25,819 98% 12,895 45% 50% North West 59,122 11,662 21% 7,658 13% 66% Western Cape 78,324 77,521 86% 42,204 54% 64% TOTAL 932,957 691,754 76% 433,037 46% 63% 74
  • 75. MUNICIPAL PROGRAMME 2009/10 as at 28 February 2010 Province Name Revised Connections Actual Year to date Connections- Connections February-2010 Eastern Cape 6,904 0 5,323 Free State 2,237 0 4,011 Gauteng 4,474 0 4,043 Kwazulu/Natal 17,091 0 16,832 Limpopo 7,384 718 6,200 Mpumalaga 3,019 0 1,522 North West 2,184 0 1,040 Northern Cape 349 0 353 Western Cape 4,645 282 3,763 Total 48,287 1,000 43,087 75
  • 76. MUNICIPAL PROGRAMME 2008/9 Transfers from Spent by Percentage Percentage spent National municipality transfers Province Eastern Cape 137,266 137,266 100.00% 90.70% Free State 21,791 21,323 100.00% 157.73% Gauteng 128,847 127,069 100.00% 98.62% KwaZulu Natal 94,394 93,521 100.00% 93.65% Limpopo 56,636 56,014 100.00% 36.05% Mpumalanga 47,248 45,663 100.00% 96.66% Northern Cape 3,413 3,413 100.00% 51.13% North West 43,772 38,180 100.00% 87,24% Western Cape 55,772 55,747 100.00% 97.33% Total 589,139 589,139 100.00% 98.90% 76
  • 77. MUNICIPAL PROGRAMME 2008/9 2008-9 Connections as at 28 February 2010 Province Name Revised Connections Year to date Actual Eastern Cape 6904 5,323 Free State 2237 4,011 Gauteng 4474 4,043 Kwazulu/Natal 17091 16,832 Limpopo 7544 6,200 Mpumalanga 3019 1,522 North West 2184 1,040 Northern Cape 349 353 Western Cape 4645 3,763 Total 48447 43,087 77
  • 78. ESKOM PROGRAMME 2009/10 as at 28 February 2010 Province Planned CAPEX Total YTD Actual Percentage CAPEX spend Eastern Cape 331,340,531 271,187,706 82% Free State 49,323,990 38,690,271 78% Gauteng 71,950,766 54,342,727 76% KZN 303,178,808 294,752,619 97% Limpopo 156,701,639 86,250,214 55% Mpumalanga 95,618,928 53,362,752 56% North West 79,349,578 53,377,689 67% Northern Cape 28,809,747 15,709,212 55% Western Cape 53,672,859 30,198,518 56% Grand Total 1,169,946,849 897,871,713 76% 78
  • 79. ESKOM PROGRAMME 2009/10 as at 28 February 2010 Province Planned Total YTD Actual Connections Connections Eastern Cape 29 280 22,364 Free State 5 783 5,540 Gauteng 6 411 3,378 KZN 20 344 13,632 Limpopo 14 612 13,706 Mpumalanga 6 117 5,126 North West 7 565 4,834 Northern Cape 1 645 1,254 Western Cape 6 670 5,052 Grand Total 98 427 74,886 79
  • 80. Schools Connections as at 28 February 2010 Province Planned Total YTD Actual Connections Connections Eastern Cape 214 155 Free State Gauteng KZN 132 81 Limpopo 107 87 Mpumalanga 22 28 North West 6 6 Northern Cape Western Cape Grand Total 481 357 80
  • 81. 2010/11 plan Province MUNICIPAL ESKOM TOTAL ALLOCATION % OF NATIONAL PER PROVINCE ALLOCATION R’000 R’000 Eastern Cape 285 258 551 486 836,744 30.2% Free State 55 063 38 921 93,984 3.4% Gauteng 142 200 107 616 249,816 9.0% KwaZulu- Natal 223 776 409 294 633,070 22.8% Limpopo 130 500 188 268 318,768 11.5% Mpumalanga 57 300 117 657 174,957 6.3% Northern Cape 21 555 47 265 68,820 2.5% North West 40 800 192 883 233,683 8.4% Western Cape 63 652 98 391 162,043 5.8% BASELINE ALLOCATION 1 020 104 1 751 780 2,771,885 81
  • 82. Service Delivery Performance • The electrification programme is one of the best performing service delivery programme on the overall. • Electrification is the number one priority for most communities although not as basic as water. • The biggest challenge at the moment is the provision of bulk infrastructure in deep rural areas. • Eskom program is satisfactorily delivering in terms of numbers. • Funding of Bulk infrastructure has drastically reduced the connections targets. • Informal settlements poses a big threat in reaching universal access by target date. • Funding is not aligned to the target and pressures on the ground. • The yearly increases only caters for the inflationary implications on the programme. 82
  • 83. SHORT-TERM OBJECTIVES AND OUTCOMES 2010/11 OBJECTIVES OUTCOME 1. Existing homes (formal) that were No formal RDP houses completed without constructed within last 2 years timeframe electricity all electrified. 2. Address all political hotspots with service All hotspots identified and addressed delivery protests due to lack of electricity 3. Breaking New Ground Projects in urban All identified Breaking New Grounds in Metros areas to relieve informal settlements and secondary cities prioritized. prioritized (including bulk projects). 4. All outstanding formal schools prioritized Universal access to schools this financial year 5. Build bulk projects to open up access in Completed bulk projects to open up areas for specific targeted rural areas. electrification 6. Upgrading of bulk projects where Completed upgrade bulk projects. electrifications cannot proceed without the upgrade. 83 21:23 83
  • 84. 2010/11 MTEF STRATEGIC PLAN BUDGET ALLOCATION Mr D Netshivhazwalu 84
  • 85. MTEC Proposal Programme 2009/10 MTEC Final Variance Variance as ENE Proposal Appropriation (Fin App- a % of Proposal) Proposal Administration 75,5 189,5 104,2 (85,3) (45,0) Hydrocarbons 60,5 60,5 1 555,9 1 495,4 2 471,7 and Energy Planning Electricity, 458,0 458,0 408,8 (49,2) (10,7) Nuclear and Clean Energy Associated 3 556,0 3 378,3 3 463,8 85.5 2,5 Services Total 4 150,0 4 086,4 5 535,4 1 449,0 35,5
  • 86. ENE allocated funds 2009/2010 2010/2011 2011/2012 2012/2013 Programmes Revised Medium term expenditure estimates Estimate MTEF Baseline Administration 68,2 104,2 127,7 106,9 Hydrocarbons 54,4 1 555,8 1 564,4 1 571,2 and Energy Planning Electricity, 327,5 408,8 513,7 116,5 Nuclear and Clean Energy Associated 3 290,1 3 463,8 3 553,6 3 744,0 Services Total 3 740,2 5 535,4 5 739,6 5 538,7 86
  • 87. ENE allocations per economic classification 2009/2010 2010/2011 2011/2012 2012/2013 Programmes Revised Medium term expenditure estimates Estimate MTEF Baseline Current 194,5 202,1 235,6 220,7 Payments Transfer and 3 543,1 5 328,7 5 499,1 5 312,8 Subsidies Payments of 2,6 4,6 5,0 5,3 Capital Assets Total 3 740,2 5 535,4 5 739,6 5 538,7 87
  • 88. 2010 MTEF Allocation • Total allocation for DoE for 2010 is R5,535 billion • Major projects funded: – Integrated National Electrification Programme- R2,808 billion – Demand Side Management-R 329 million – Renewable Energy –R36 million – Energy modelling system –R20 million – Transnet pipeline – R1,5 billion 88
  • 89. Costing of the approved structure for DOE Programme Cost of Structure Available Funding Difference Support Services 134,479,632.06 51,452,397.90 ( 83,027,234.16) Policy Development 51,196,330.92 17,042,741.82 ( 34,153,589.10) Nuclear Energy 56,311,575.54 48,757,626.00 (7,553,949.54) Integrated Energy Planning 21,951,150.12 18,064,200.18 (3,886,949.94 ) Nuclear Technology 23,895,717.12 6,917,858.58 ( 16,977,858.54 ) Total 287,834,405.76 142,234,824.48 (145,599,581.28 )
  • 90. Costing of the interim structure for DOE Programme Cost of Structure Support Services R46,8m Hydrocarbons & Energy Planning R50,8m Electricity & Nuclear R35,5m Total R133,1m Note: -Interim structure developed in line with available funding -Line function branches funded according to existing positions (old DME structure) - Support services – funding allocated to key priority positions
  • 91. THANK YOU & ?