PRESENTATION LAYOUT

DEPARTMENT OF ENERGY

Presentation of the Annual Performance Plan, Strategic Plan and Budget Vote 29

Mr Tseliso MaqubelaActing Director General

01 July 2014

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PRESENTATION LAYOUT

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• Introduction

• The Department of Energy – Who we are

• Highlights and challenges of the first five (5) years

• Key focus areas for the 2014/15 financial year

• Branch Presentations

• 2014/15 Budget

• Conclusion

INTRODUCTION

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DOE Senior Management Team:

•Mr T Maqubela – Acting Director General

•Mr O. Aphane – DDG Energy Policy and Planning

•Dr W Barnard – DDG Energy Programmes and Projects

•Mr Z Mbambo – DDG Nuclear

•Mr V Sibiya – Acting DDG Petroleum and Petroleum Products Regulation

•Ms Y Chetty – Chief Financial Officer

•Mr G Mnguni – DDG Corporate Services

•Ms T Zungu – Chief Operating Officer

WHO WE ARE (intro)

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Established in May 2009 – outcome of the split of the Department of Minerals and

Energy into Department of Energy and Department of Mineral Resources

AIM: Formulate energy policies, regulatory frameworks and legislation, and oversee

their implementation to ensure energy security, promotion of environmentally friendly

energy carriers and access to affordable and reliable energy for all South Africans.

MISSION: To regulate and transform the sector for the provision of secure,

sustainable and affordable energy

VISION 2025: Improving our energy mix by having 30% of clean energy by 2025.

WHO WE ARE (CONT)

• The core business of the Department is premised amongst others on the Energy

White Paper of 1998 as well as the National Energy Act, 2008 (Act No. 34 of

2008) which, amongst others mandates the Department to ensure that diverse

energy resources are available, in sustainable quantities and at affordable prices,

to the South African economy in support of economic growth and poverty

alleviation, while taking into account environmental management requirements

and interactions amongst economic sectors.

• In carrying out this mandate, the Department develops legislation; undertakes

programmes and projects; and in some instances, transfer resources to various

implementing agencies and state owned entities (SOEs).

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MACRO ORGANISATIONAL STRUCTURE OF DOE

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MinisterMinister Deputy MinisterDeputy MinisterAssociated InstitutionsAssociated Institutions

Department of EnergyDepartment of Energy

Office of the DGOffice of the DGMinisterial and Parliamentary

ServicesMinisterial and Parliamentary

Services

Directorate Audit ServicesDirectorate Audit Services

BranchEnergy Policy,

Planning and Clean Energy

BranchEnergy Policy,

Planning and Clean Energy

BranchPetroleum

and Petroleum Products

Regulation

BranchPetroleum

and Petroleum Products

Regulation

BranchNuclear Energy

BranchNuclear Energy

BranchEnergy

Programmes and

Projects

BranchEnergy

Programmes and

Projects

BranchCorporate Services

BranchCorporate Services

BranchFinancial

Management Services

BranchFinancial

Management Services

BranchGovernance

and Compliance

BranchGovernance

and Compliance

ORGANISATIONAL STRUCTURE (CONT)

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The approved organisational structure consists of the following seven branches:

Energy Policy, Planning & Clean EnergyPurpose: Ensure evidence- based planning, policy setting and investment decisions in the energy sector to improve energy security, through supply and demand side options, and increase competition through regulation.

Petroleum and Petroleum RegulationsPurpose: Manage the regulation of petroleum and petroleum products to ensure optimum and orderly functioning of the petroleum industry to achieve government’s developmental goals.

Energy Programmes and Projects Purpose: Manage, coordinate and monitor programmes and projects focused on access to energy;

ORGANISATIONAL STRUCTURE (CONT)

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Nuclear EnergyPurpose: Manage the South African nuclear energy industry and control nuclear material in terms of international obligations, nuclear legislation and policies to ensure the safe and peaceful use of nuclear energy.

Corporate ServicesPurpose: To provide corporate support to the DOE.

Governance and CompliancePurpose: To ensure good corporate governance and compliance by the DOE and its SOEs; and

Financial Management ServicesPurpose: To provide financial management, accounting and supply chain management services to the DOE.

UPDATE ON APPROVED, FUNDED AND UNFUNDED POSTS

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• Total No of Posts on DoE’s approved establishment : 814

• Total No of Funded Posts: 569

• Total No of Unfunded Posts: 245

A process is underway with National Treasury to deal with funding issues.

LOCATION OF DOE OFFICES

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• The Department consists of a national office that is situated in Gauteng Province( Matimba House); and

• Nine (9) Regional Offices that are situated in various provinces, namely:-a) Eastern Cape (Port Elizabeth);b) Free State (Welkom);c) KwaZulu-Natal (Durban);d) Limpopo (Polokwane);e) Mpumalanga (Emalahleni); f) Northern Cape (Kimberley);g) Western Cape (Cape Town);h) Gauteng (Pretoria); andi) North West (Klerksdorp).

NB: DoE is still sharing office space with DMR in seven Regional offices except for Cape Town and Gauteng.

LEGISLATION THAT GOVERNS THE ENERGY SECTOR

• National Energy Act, 2008 (Act No. 34 of 2008);• Electricity Regulation Act, 2006 (Act No. 4 of 2006), as amended;• Petroleum Products Act, 1997 (Act No. 120 of 1977);• Central Energy Fund Act, 1977 (Act No. 38 of 1977), as amended;• Nuclear Energy Act, 1999 (Act No. 46 of 1999);• National Nuclear Regulator Act, 1999 (Act No. 47 of 1999);• National Radioactive Waste Disposal Institute Act, 2008 (Act No. 53 of 2008);• Petroleum Pipelines Act, 2003 (Act No. 60 of 2003);• Petroleum Pipelines Levies Act, 2004 (Act No. 28 of 2004);• Gas Act, 2001 (Act No. 48 of 2008);• Gas Regulator Levies Act, 2002 (Act No. 75 of 2002);• National Energy Regulator Act, 2004 (Act No. 40 of 2004); and• Abolition of the National Energy Council Act, 1991 (Act No. 95 of 1991); and• Electricity Act, 1987 (Act No. 41 of 1987), as amended.

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STRATEGIC OUTCOMES

The Department has the following Strategic Outcomes:

•Security of Supply by ensuring that energy supply is secure and demand well managed;

•Infrastructure development by facilitating an efficient, competitive and responsive energy infrastructure

network;

•Regulation and Competition certainty by ensuring that there is improved energy regulation and competition

in the energy sector;

•Universal Access and Transformation by ensuring that there is an efficient and diverse energy mix for

universal access within a transformed energy sector;

•Environmental Assets that are well protected and continually enhanced by cleaner energy technologies.

•Climate Change response by implementing policies that adapt to and mitigate the effects of climate

change.

•Prudent Corporate Governance through implementation of good governance practices for effective and

efficient service delivery.

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ENTITIES REPORTING TO THE MINISTER OF ENERGY

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• National Energy Regulator of South Africa (NERSA)

• National Nuclear Regulator (NNR)

• South African National Energy Development Institute (SANEDI)

• South African Nuclear Energy Corporation, (SOC) Ltd (NECSA)

• Central Energy Fund (SOC) Ltd (“CEF” Group)-

• National Radioactive Waste Disposal Institute (NRWDI) recently established.

HIGHLIGHTS FOR THE FIRST FIVE YEARS

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• Improved access to energy services in rural communities through electrification of

over 1.1 million new connections and construction of Integrated Energy centres.

• Produced the country’s 20 year plan (IRP)for electricity, with a deliberate bias

towards cleaner energy.

• Introduction of the independent power producers

• The Department has gone a long way in creating regulatory certainty, which is

bearing fruit through significant investments in energy infrastructure.

CHALLENGES

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• Inadequate generation capacity;

• Distribution Infrastructure;

• Cost of energy;

• Access to electricity;

• Energy efficiency; and

• Economic transformation.

KEY FOCUS AREAS FOR THE 2014/15 (FY)

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• Increase access to electricity with an additional 265 000 grid connections and 15

000 non-grid installations;

• Increase momentum on the installation of solar water heating units;

• Finalise the Integrated Energy Plan (IEP) with more detailed infrastructure plans;

• Address maintenance and refurbishment backlogs in the electricity distribution

industry;

• Strengthen the liquid fuels industry; and

• Facilitate the process leading to the implementation of decisions taken on the

nuclear programme.

PROGRAMME 2

ENERGY POLICY, PLANNING AND CLEAN ENERGY BRANCH

PRESENTED BY Ompi Aphane

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Policy Planning and Clean Energy Strategic objectives

Strategic Outcome Strategic Objective Branch Functions

Outcome 4 – Decent employment through inclusive economic growth

Improve energy security by:

Regulating demand and introducing a diverse mix of energy generation and energy efficiency technologies on an ongoing basis,Increasing competition in the energy sector by introducing Eskom and non-Eskom generators

Policy Analysis and ResearchDevelops key indicators and monitors the impact of energy sector policies, planning and interventions; analyses all energy policies and their impact on access to energy and on energy security;Conducts research and analyses policies in relation to other countries.

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Strategic objectivesStrategic Outcome Strategic Objective Branch Functions

Outcome 6 – An efficient, competitive, responsive economic infrastructurenetwork.

Outcome 8 – Sustainable human settlements and improved quality of household life

Planning interventions to expand energy infrastructure through the development of a policy framework for the Integrated Energy Plan, the Integrated Resource Plan, the Liquid Fuels Infrastructure Roadmap, the Gas Utilisation Master Plan, the Transmission Development Plan, Major Distribution Infrastructure

Publishing an Annual Energy Statistics Report to facilitate information- based decision making.

Energy PlanningDevelops and maintains

various energy modelling tools to estimate future energy demand and explore alternative energy supply options; identifies energy supply constraints and addresses them through the Integrated Energy Plan

• Manages the collection and maintenance of energy data and dissemination of quality energy statistics and information.

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Outcome 6 – An efficient, competitive and responsive economic infrastructurenetwork.


• Improve the regulation and transformation of the sector

•Hydrocarbon PolicyEnsures a secure energy supply, well managed demand, enhanced access to hydrocarbons, a transformed energy sector and ensures that energy regulation and competition is improved

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Outcome 6 – An efficient, competitive and responsive economic infrastructurenetwork.


Outcome 10 –Environmental assets and natural resources that are well protected and continually enhanced

• Establish appropriate mechanisms to prefund capital and create a smooth price path over a longer-term for Eskom

Electricity, Energy Efficiency and Environmental PolicyEnsures secure electricity supply, well managed demand and a transformed sector with appropriate regulation.

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• Climate change and Environment…

Manage climate change and environmental matters by developing and implementing Climate Change policies and the green economy

• Energy EfficiencyImproves Energy Efficiency

(EE) by planning and co-ordinating initiatives and interventions focused on developing and improving the EE market and ensures integration and co-ordination of EE initiatives

• Renewable EnergyEnsures the integration of

renewable energy into South Africa’s mainstream energy supply by planning and co-ordinating initiatives, interventions focused on the development and improvement of the renewable energy market and integration and co-ordination

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• Climate change and Environment…

Manage climate change and environmental matters by developing and implementing Climate Change policies and the green economy

• Climate Change and Designated National Authority

Ensures that climate change and environment response measures, in terms of mitigation and adaptation are implemented within the energy sector.

Ensures the fulfilment of international energy commitments and obligations under the United Nations Framework Convention on Climate Change pertaining to the Kyoto Protocol.

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Annual Performance Plan (Targets 2014/15)

Actions from MTSF Gap Analysis (in SONA but not in

APP)

Proposed Action

Introduce the Electricity Regulation Amendment Bill, National Energy Regulator Amendment Bill for consideration and support their promulgation if approved by Cabinet and parliament

Amend the National Energy Regulator Act and the Electricity Regulation Act

Aligned None

Manage the Implementation of the IRP and Agreements in respect of IPP programmes that have reached financial close.

Develop a Private Sector Participation Framework (PSP) in the energy sector in baseload and renewable electricity generation, liquid fuels and gas.

The long-term electricity tariff path and the funding model for the build programme will determine the extent to which Eskom/private sector will be able to roll out the capital programme

Promulgate the long term price path after completing the IRP Update

Annual Performance Plan

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Actions from MTSF Gap Analysis Proposed Action

Finalised IEP submitted to Cabinet for approval.

Develop the Integrated Energy Plan (IEP)

Aligned. Reference in SONA to Energy Master Plan

IEP public consultation has been completed. IEP to be consulted within the interdepartmental process prior to Cabinet submission

Improve liquid fuels energy security by developing and implementing the Liquid Fuels 20-Year Infrastructure Plan over the medium term. Promulgate the Gas Utilization Master Plan if approved by Cabinet Launch a gas fired IPP programme based on LNG or piped gas in line with the IRP

Develop/implement a Gas Infrastructure Master Plan;explore potential for substituting coal with gasdevelop West Coast gas resources and invest in LNG infrastructuredevelop West-Coast off-shore gas for powersecure feedstock for gas-to-liquid Mossgas plantconduct exploratory drilling to establish economically recoverable shale gas reserves, investigate environmental impacts and mitigation


Public consultation on GUMP after Cabinet approval. Liquid Fuels Master Plan to follow after GUMP approval


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Promulgate the updated IRP (IRP2014) incorporating the nuclear programme Integrate the Transmission Development Plan including Interconnections into neighbouring countries Integrate the Major Distribution Infrastructure for the Metro Municipalities

Refine, update and implement the Integrated Resource Plan (IRP)


IRP Update public consultation has been completed; to be consulted within the interdepartmental process prior to Cabinet submission

Introduce the Independent Market and Systems Operator Bill for consideration and support its promulgation if approved by Cabinet and parliament

Establish an independent system operator

Not yet aligned. Further time requested for consultation

Introduce bidding rounds for solar, wind, biomass, hydro, cogeneration, coal, gas programmes in accordance with the IRP determinations made by the Minister

Reform of the electricity supply industry to introduce IPPs in support of electricity security of supply

Aligned. Window 4 of the REIPPP on track. Cogeneration and coal programmes to be launched this year.


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Launch a hydro power programme based on Inga and/or Mozambique hydro resources

Develop Southern Africa’s hydro-electric resources and enhance inter-regional electricity trade

Aligned. Reference in SONA to proceed with Inga Hydropower project

Treaty is in the process of being submitted to parliament for ratification.

Address current and envisaged energy supply and distribution constraints by developing the planned Approach to Distribution Asset Management (ADAM) for the rehabilitation of critical municipal electricity distribution infrastructure

Ring-fence the electricity-distribution businesses of the 12 largest municipalities and resolve their maintenance and refurbishment backlogs

Not yet aligned. Regulatory interventions by the Department need to be complemented by municipal buy-in (in line with their Constitutional mandate)

Engagement of SALGA , Department of Cooperative Governance and Local Government.

Develop a transmission and major distribution infrastructure plan as part of the IRP Develop a funding model to implement the major distribution infrastructure plan

Review bulk electrical infrastructure required for universal access to electricity, prepare an implementation plan, and implement

Aligned.


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Annual Performance Plan (Targets 2014/15 Actions from MTSF Gap Analysis Proposed Action

Promulgated standard offer incentive scheme for:- solar water heaters and- reducing energy in the building envelope2.5 TWh of energy savings realized and verified from energy efficiency and demand side management projects. Developed energy consumption baselines for additional 30 municipalities Promulgation of National Energy Efficiency strategy document (once approved by Cabinet) 204 000 solar water heating units installed in residential and commercial sectors. Develop a revised contracting model to increase the local content in the SWH programme

Improve demand-side management, including through smarter management of electricity grids

Not yet aligned. The regulatory account for Energy Efficiency is still under Eskom auspices, whereas government policy has determined that a new institutional arrangement for EE needs to be created outside Eskom.

Finalize the energy efficiency institutional arrangement outside Eskom.


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Annual Performance Plan (Targets 2014/15


Introduce bidding rounds for solar, wind, biomass, hydro, cogeneration programmes in accordance with the IRP determinations made by the Minister

Commission at least 7000 MW of renewable energy by 2020

None.

Take a decision on expanding oil refining capacity by 2016

Aligned. To be informed by the conclusion of the Liquid Fuels Infrastructure Plan

Finalize cost recovery mechanism for cleaner fuels

Develop a funding mechanism for upgrading of existing refineries to ensure they meet new fuel-quality standards

Aligned.

Develop a pricing mechanism to accommodate imports and the development of storage infrastructure

Increase LP Gas usage in the domestic and industrial sectors

Aligned.To be informed by the conclusion of the GUMP

Introduce biofuels into the liquid fuels industry through mandatory blending

Aligned.Pricing mechanism has been developed


PROGRAMME 3

PETROLEUM & PETROLEUM PRODUCTS REGULATIONS BRANCH

PRESENTED BYVICTOR SIBIYA

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PURPOSE OF THE BRANCH

To manage the regulation of petroleum products to ensure optimum and orderly functioning of the petroleum industry to achieve government's developmental goals.

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BRANCH’ SUB-PROGRAMME

PETROLEUM PRODUCTS

REGULATIONS BRANCH

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SUB-PROGRAMME 1: PETROLEUM COMPLIANCE MONITORING AND

ENFORCEMENTSTRATEGIC OUTCOME STRATEGIC OBJECTIVE FUNCTIONSOutcome 6: An efficient, competitive and responsive economic infrastructure network.

Outcome 10: Environmental assets and natural resources that are well protected and continually enhanced.

Ensure development and transformation of the Liquid Fuels industry and security of supply of petroleum products in the South African economy through monitoring and enforcing technical and economic compliance to legislation, specifications, standards and licence conditions in each year of the medium term

• This sub-programme monitors compliance with the Liquid Fuels Charter and technical, legal and commercial licensing conditions.

• The sub-programme also processes arbitration requests as well as promotion of access to information requests on behalf of the Controller of Petroleum Products.

• It also assist in finalising appeals sent to the Minister on the decisions of the Controller.

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SUB-PROGRAMME 2: PETROLEUM LICENSING & FUEL SUPPLY

STRATEGIC OUTCOME STRATEGIC OBJECTIVE FUNCTIONSOutcome 4: Decent employment through inclusive economic growth.

Outcome 6: An efficient, competitive and responsive economic infrastructure network.

To facilitate participation of Historically Disadvantaged Individuals (HDIs) in the petroleum sector by enforcing compliance by wholesalers, manufactures and retailers with the empowerment legislation in the adjudication of licences on an ongoing basis.

• This sub-programme manages the adjudication of petroleum licence applications; regulates the permitting of export and import of petroleum products.

• Monitors fuel stock levels, and co-ordinates corrective actions to avoid fuel shortages.

• This entails conducting licensing analysis, and ensuring permit and compliance to empowerment legislation and hydrocarbons supply.

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SUB-PROGRAMME 3: FUEL PRICING REGULATIONSTRATEGIC OUTCOME STRATEGIC OBJECTIVE FUNCTIONS

Outcome 4: Decent employment through inclusive economic growth.

Outcome 6: An efficient, competitive and responsive economic infrastructure network.

Strengthen the regulatory framework in the liquid fuels petroleum industry by implementing the Regulatory Accounting System (RAS) to have a transparent fuel pricing mechanism that will reward investors in the liquid fuels sector throughout the value chain by 2013/14.

• This sub-programme regulates the pricing of petroleum products in accordance with the legislative framework.

• This entails the determination, review, update and maintenance of fuel levies and margins and the process of paying fuel levies.

• Administering fuel pricing by developing, evaluating and monitoring price models, and updating elements of the Basic Fuel Price (BFP).

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Annual Performance Plans - Annual Target

2014/15

Actions from the MTSFOutcomes 4, 6, 7, 8, 9 & 10

Gap Analysis Proposed Action

Enforcement notices issued in 85% of cases where non-compliance is identified during routine compliance inspections.

(i) To facilitate an efficient, competitive and responsive energy infrastructure network.

(ii) Promote energy security

Cumbersome process of imposing penalties for non-compliance.

Amend Legislation to ensure that the process of imposing penalties is not laborious

Enforcement notices issued in 95% of cases where non-compliance is identified during routine fuel samples testing.

(i) To facilitate an efficient, competitive and responsive energy infrastructure network. (ii) Promote energy security

Cumbersome process of imposing penalties for non-compliance.

Amend Legislation to ensure that the process of imposing penalties is not laborious

30% of licence applications approved with at least 50% BEE ownership



Slow empowerment of certain historical disadvantaged groups .Access to funding by certain historical disadvantaged groups remains a challenge

Implement the revised BBBEE code.

ANNUAL PEFORMANCE PLAN

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Annual Performance Plans - Annual Target 2014/15



100% of arbitration requests finalised within the prescribed timeframes.



Limited understanding of the arbitration process resulting in limited utilization of this process.

Enhance stakeholder awareness.

Implementation of the BFP / MDZ review study recommendations.

i) To ensure that there is improved energy regulation and competition.

ii) To provide regulatory certainty to investors

Negative impact on the economy due to high fuel prices.

Review the BFP elements and implement the MDZ review study recommendations.

Conduct the service stations survey to determine the Benchmark Service Station asset base

i) To ensure that there is improved energy regulation and competition.ii) To provide regulatory certainty to investors

Ensure fair return on investment in the retail sector

Implement the outcome of the Benchmark Service Station asset base


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Gazette the Bio-fuels pricing Framework.

i) To ensure that there is improved energy regulation and competition.

ii) To provide regulatory certainty to investors

Pricing framework that encourages investment in Bio-fuels

Finalise and Gazette the Biofuels pricing Framework.


PROGRAMME 4

ELECTRIFICATION AND ENERGY PROGRAMME AND PROJECT MANAGEMENT BRANCH

PRESENTED BYDr Wolsey (Vusi) Barnard

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PROGRAMME 4: ENERGY PROGRAMMES AND PROJECTS

Programme outline

Consist of five sections, all dealing with different aspects implementation of

energy policies, programmes and projects and the promoting of such

energy initiatives.

Purpose

Manage, co-ordinate and monitor programmes and projects focused on

access to energy

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STRATEGIC OBJECTIVESSTRATEGIC OBJECTIVE FUNCTIONSDefinition

Integrated National Electrification Programme (INEP)

Units / sub-programme functions

To manage, coordinate, monitor and report on programmes and projects to promote/enhance universal access to energy.

Energy Regional Offices

To assist with obtaining information relevant to the identification, planning and implementation of projects, do physical inspections on the execution of projects and liaise between beneficiaries/potential beneficiaries of projects, service providers and the Department.

Programmes and Projects Management Office

To provide specialised assistance to the programme/project managers and management in general to apply project management principles, coordinate project information and report on projects of the Department.

Energy Infrastructure/ Industry Transformation

To implement, coordinate, monitor, administer and report on programmes and projects focused on the development/improvement/transformation of the energy generation/ refinement, transmission and distribution industry and infrastructure.

Community Upliftment Programmes and Projects

• To develop strategies and guidelines to mainstream gender, youth development, persons with disabilities, HIV&Aids and promoting youth to pursue Science Technology Engineering and Maths (STEM) to increase the necessary scarce skills in the sector;

• To identify, implement, manage and coordinate programmes/projects aimed at poverty alleviation, rural development, mainstreaming, and/upliftment/ empowerment of disadvantaged/vulnerable groups and communities; and

• To promote public awareness on energy issues.41

BRANCH ONTRIBUTION TO 12 GOVERNMENT OUTCOMES AND PICC

INEP contributes directly or indirectly to the following Outcomes Based Planning Approach:

Outcome 4 – Employment: Decent employment through inclusive economic growth;

Outcome 6 – Economic Infrastructure: An efficient, competitive and responsive economic infrastructure network Outcome 7 – Rural Development: Vibrant, equitable and sustainable rural communities with food security for allOutcome 8 – Integrated Human Settlements: Sustainable human settlement and improved quality of household life Outcome 9 – Local Government: A responsive, accountable, effective and efficient local government system.Outcome 10 – Environment: Protect and enhance our environmental assets and natural resources.

INEP is also reporting at this stage into SIP 1, 4, 6, 8, 9 and 10 of the PICC.

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PICC AND STRATEGIC INTEGRATED

PROJECTS (SIPs)

• SIP1: Unblocking the Northern Mineral Belt with the Waterberg as the catalyst

• SIP 4: Unlocking the economic opportunities in North West Province

• SIP 6: Integrated Municipal Infrastructure

• SIP 8: Green Energy in Support of the South African Economy

• SIP 9: Electricity generation to support socio-economic development

• SIP10: Electricity Transmission and Distribution for All.

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Actions from the MTSF Outcomes 4, 6, 7, 8, 9 & 10


4.1: INTEGRATED NATIONAL ELECTRIFICATION PROGRAMME (INEP)Plan, facilitate the transfer of funding and monitor the electrification of households in line with the allocated budget (265 000 Grid connection)

Roll out of electrification on both off and on grid.

Budget allocation will only produce 1 452 000 by 2019. Resources constraints with regards to electrification programme and electricity sector to be addressed in order to achieve the universal access by 2025

Plan for increased delivery to be developed this year in line with National Household Electrification Strategy approved in June 2013.

Plan, facilitate the transfer of funding and monitor the electrification of households in line with the allocated budget (15 000 Off-Grid connection)

Roll out of electrification on both off and on grid.

Budget allocation will only produce 105 000 by 2019. Resources constraints with regards to electrification programme and electricity sector to be addressed in order to achieve the universal access by 2025

Plan for increased delivery to be developed this year in line with National Household Electrification Strategy approved in June 2013.

Plan, facilitate the transfer of funding and monitor building/upgrading of electrification infrastructure projects per year.

Review bulk electrical infrastructure required for universal access to electricity, prepare an implementation plan, and implement

Resources constrain wrt electricity sector to be addressed in order to achieve the universal access by 2025.

Obtained ringfenced infrastructure allocation to ensure electrification programme can achieve targets

National electrification Masterplan In-house resources to develop appropriate plan and maintain such a plan

Obtain funding for implementation of Master Plan to achieve universal access by 2025.

ANNUAL PERFORMANCE PLAN

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4.2: ENERGY REGIONAL OFFICES

Physical inspections on the execution of to Energy projects and liaison between beneficiaries of projects, service providers and the Department

Resource constrains of Regional structure

Additional resources to be obtained and re-training of current staff

4.3: PROGRAMME AND PROJECTS MANAGEMENT OFFICE Progress reports and dashboard submitted per project within the Department (PMU)

Improved monitoring of DoE related projects and programmes

Complete project management (PM) platform for improve PM monitoring and reporting

Solar Water Heater (SWH) implementation and monitoring – 204 000

Improve demand-side management, including through smarter management of electricity grids and Energy Efficient measures such as SWH .

Challenges wrt current installed SWH systems, roll-out of new Contacting model and high local content implementation

New contacting model of 70% local content and training of youth and women installers, closers co-operation between DOE and municipalities, as well as improved monitoring.

Renewable Energy (RE) and Energy Efficiency (EE) implementation programmes

Implement IRP wrt renewable energy and energy efficiency

Resource constrains of DOE and acceptance by industry

Implementation of Sustainable Energy For All (SE4All) of the UN

ANNUAL PERFORMANCE PLAN (cont.)

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4.4: Electricity Infrastructure / Industry TransformationImplementation and Monitor of IPP projects – ensure that 1000 MW of Green power is supplied into the grid

Reform of the electricity supply industry to introduce IPPs in support of electricity security of supply.

Improve the implementation agreements of IPPs and monitoring processes

• Improve feedback loop in PM of IPP monitoring activities

• More job creation and Economic transformation

Implementation and Monitoring of the Social Economic Development (SED) programmes of the IPPs – Improve participation of SMME’s

Reform of the electricity supply industry to introduce IPPs in support of electricity security of supply

Improve the implementation agreements wrt SED of IPPs and monitoring processes

Improve feedback loop in SED monitoring of IPP and utilized more sustainable SED models

Monitoring refurbishment of key electrical networks in municipalities (mini-ADAM) – completion of all 7 municipal. And 2 metro electrical infrastructure projects

Ring-fence the electricity-distribution businesses of the 12 largest municipalities and resolve their maintenance and refurbishment backlogs.

• Constitutional clarification on EDI.

• Munics and Eskom not investing appropriate funds for maintenance and upgradings

• Funding model

Engagement of SALGA, MISA, Department of Cooperative Governance and Local Government.


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4.4: Energy Infrastructure / Industry Transformation (cont.)PICC and Strategic Integrated Projects (SIP) support

Infrastructure improvement, job creation and economic transformation

• Resource constrains of DOE

• Communication loop• Co-ordination

between government departments and SOEs

• Better alignment of all Energy related programmes and projects with relevant SIPs

• Improved communication with PICC structures

4.5: COMMUNITY UPLIFTMENT PROGRAMMES AND PROJECTS Establishment of 2 new, operational Integrated Energy Centres (IECs) and assistance to existent IeCs

Integrated EnergyCentres (IECs) establishment in rural areas to give access to petroleum and other energy carries.

Support from local municipalities and the sustainable management of IECs

7 more IeC established by March 2019 in addition to current 10 already been established

Community upliftment Programmes for developed of Energy Sector (Youth, Gender, Disability, HIV & AIDS) and Public energy awareness campaigns

Youth, Gender as well as people from disadvantage communities owned companies not effectively represented in energy projects.

• SWH training, installation and maintenance programme earmarked for youth and women owned companies.

• Enforced more SMME’s to be involved in the REIPP build programme

• Pooling of public and private sector resources and

• Re-training of staff.


PROGRAMME: 5 NUCLEAR ENERGY

Programme outlineThis programme consist of three sub-programmes namely:Chief Directorate Nuclear Safety and TechnologyChief Directorate Nuclear Non-Proliferation and Radiation SecurityChief Directorate Nuclear PolicyResponsible for the implementation of nuclear policy

PurposeManage the South African Nuclear Energy Industry and control nuclear material in

terms of international obligations, relevant legislation and policies to ensure the safe and peaceful use of nuclear energy

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PROGRAMME 5

NUCLEAR ENERGY BRANCH

PRESENTED BYMr Zizamele Mbambo

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sub-programme: Nuclear Non-proliferation and Radiation SecurityStrategic Outcomes STRATEGIC OBJECTIVE FUNCTIONS

Outcome 10- Environmental assets and natural resources that are well protected and continually enhanced

Nuclear Security: To regulate the security of nuclear material, related material, equipment and facilities through appropriate statutory framework.

Accounting and control of nuclear material: To account for and control of the nuclear materials & related material and equipment by enforcing relevant statutory framework.

Manages and implements all matters related to nuclear non-proliferation and radiation security as required by legislation and international agreements.

It is responsible for accounting and control of nuclear material through authorisations, ensuring compliance by conducting inspections and audits

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Sub-programme: Nuclear Safety and Technology

Strategic Outcomes STRATEGIC OBJECTIVE FUNCTIONS

Outcome 4- Decent employment through inclusive economic growth

Outcome 6- An efficient, competitive and responsive economic infrastructure network

Nuclear Energy Expansion Programme: To contribute towards ensuring the security of supply by leading, developing and overseeing the implementation of nuclear expansion programme guided by Nuclear Energy Policy and National Nuclear Energy Executive Coordination Committee (NNEECC) in accordance with IRP 2010-2030

Manages and implements all matters related to nuclear safety and technology as required by legislation and international agreements. Implements Nuclear Energy Policy that was approved in 2008 as national nuclear programme line with the Integrated Resource Plan (IRP2010-2030)Administer all matters related to nuclear safety, liability and emergency management to improve the governance of the nuclear sector in relation to nuclear safety and technology

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Strategic Outcome STRATEGIC OBJECTIVE FUNCTIONS


Radioactive Waste Management: To ensure safe, secure and sustainable management and disposal of radioactive waste by facilitating the full operation of National Radioactive Waste Disposal Institute (NRWDI).

Exercise oversight on the management of radioactive waste nationally.

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Strategic Outcome STRATEGIC OBJECTIVE FUNCTIONSOutcome 10- Environmental assets and natural resources that are well protected and continually enhanced

Nuclear Emergency Management: To ensure the readiness of all relevant stakeholders for the management of any nuclear emergency as part of the national disaster plan on an ongoing basis.

Decommissioning and Decontamination of Nuclear Facilities: To regulate the decommissioning and decontamination of nuclear installations through the appropriate statutory framework

Ensure implementation of the National Nuclear Disaster Management Plan

Service Minister’s obligations in terms of the Nuclear Energy Act dealing with decommissioning and decontamination of past strategic nuclear facilities.

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Sub-programme: Nuclear Policy

Strategic Outcome STRATEGIC OBJECTIVE FUNCTIONS


Nuclear Compliance: To ensure compliance with international obligations by developing, maintaining and implementing appropriate statutory framework for Nuclear Energy Policy by 2016

Develops and reviews policies as required by international agreements and governance of the nuclear sector. Undertakes research, development and reviews and monitors nuclear safety, technology and radiation security policies.

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Actions from the MTSF Outcomes 4, 6, 7,

9&10


100% of authorization applications considered

within the eight week time period

To provide regulatory certainty to investors

Aligned

Eight (8) nuclear safeguards compliance reports

submitted to the relevant decision making structures

Promote energy securityand ensure peaceful

use of nuclear technology

Aligned

Four (4) nuclear safeguards compliance audits submitted

to the relevant decision making structures



Aligned

Two (2) nuclear security compliance reports

submitted to the relevant decision making structures



Aligned

ANNUAL PERFOMANCE PLAN

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Actions from the MTSF Outcomes 4, 6,

7, 9&10


NNR Amendment Bill Consultation with and

presentation to the Forum of South African

Directors General (FOSAD) Cluster

To provide regulatory certainty to investors

Amend the National Nuclear Regulator Act (47 of 1999) to

ensure more efficient regulatory

environment

Finalize consultation and submission of the NNR Amendment Bill to

Chief State Law Advisor and

presentation to FOSAD Cluster


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Actions from the MTSF

Outcomes 4, 6, 7, 9&10


Five (5) public awareness

campaigns and community

outreach event held for the

demystifying of nuclear

To provide regulatory certainty to investors &

ensure public awareness

Aligned Increase public awareness campaigns.


2014/15 BUDGET PRESENTATION

Presented by: Chief Financial Officer

Ms Yvonne Chetty

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PRESENTATION LAYOUT

•Overview - Per Economic Classification

•Overview - Per programme

• Transfers to Entities & Municipalities

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2014 ENE ALLOCATION OVERVIEW – PER ECONOMIC

CLASSIFICATION

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Vote 29: Economic classification

2013/14 2014/15 2015/16 2016/17

Final Appropriation Baseline

%Growth (13/14-14/15)

Baseline%Growth (15/15-15/16)

Baseline %Growth (15/16-16/17)

R'000 R'000 R'000 R'000 R'000 R'000 R'000

Compensation of employees

230,312

291,947 26.76% 307,433 5.30% 328,271 6.78%

Goods and services 199,932

226,387 13.23% 222,566 -1.69% 234,037 5.15%Transfers and subsidies

6,060,826 6,892,110 13.72% 7,453,162 8.14% 7,816,854 4.88%

Payments for capital assets

12,173 5,195 -57.32% 5,430 4.52% 5,722 5.38%

Payments for financial assets 1 - - - - -Total economic classification

6,503,244

7,415,639 14.03%

7,988,591 7.73% 8,384,884 4.96%

2014 ENE ALLOCATION OVERVIEW – PER PROGRAMME

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VOTE 29: PROGRAMMES

2013/14 2014/15 2015/16 2016/17


%Growth (13/14-14/15)



R'000 R'000 R'000 R'000 R'000 R'000 R'000

Administration 233,142 244,122 4.71% 255,597 4.70% 271,973 6.41%Energy Policy and Planning 47,989

52,583 9.57% 50,261 -4.42%

53,635 6.71%

Petroleum and Petroleum Products Regulation 39,865

82,745 107.56% 79,767 -3.60% 83,615 4.82%

Electrification and Energy Programme and Project Management 3,967,700

4,199,212 5.83%

5,890,333 40.27%

6,203,097 5.31%

Nuclear Energy 723,998 850,502 17.47% 682,304 -19.78% 718,675 5.33%Clean Energy 1,490,550 1,986,475 33.27% 1,030,329 -48.13% 1,053,889 2.29%Total 6,503,244 7,415,639 14.03% 7,988,591 7.73% 8,384,884 4.96%

TRANSFER PAYMENT SCHEDULE

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TRANSFER PAYMENTS - DOE

2013/14 2014/15 2015/16 2016/17


%Growth (13/14-14/15)



R'000 R'000 R'000 R'000 R'000 R'000 R'000

Employee social benefits 418 374 5.06% 388 3.74% 409 5.41%INEP Grant - Non-grid 119,224 96,621 -18.96% 101,067 4.60% 106,424 5.30%Eskom -INEP 2,141,027 2,488,037 16.21% 3,680,043 47.91% 3,875,085 5.30%INEP Grant - Munics 1,314,772 1,564,658 19.01% 2,056,090 31.41% 2,165,063 5.30%INEP - ADAM 320,000 - - - NECSA 592,182 760,678 28.45% 590,838 -22.33% 622,152 5.30%National Nuclear Regulator 48,360 33,697 -30.32% 34,887 3.53% 36,736 5.30%International membership fees 40,077 12,055 -11.21% 12,481 3.53% 13,142 5.30%National Radio Active Waste Disposal Institute 19,800

-

-

-

Eskom: Solar Water Geyser Project 1,149,900 1,636,400 42.31% 700,000 -57.22% 737,100 5.30%EEDSM Grant - Munics 180,722 136,905 -24.25% 188,305 37.54% 203,815 8.24%SANEDI 63,344 51,685 -18.41% 54,063 4.60% 56,928 5.30%SANEDI: Carbon capture and storage 69,000 103,000 49.28% 35,000 -66.02%

-

SANEDI: Hydraulic fracturing 2,000 8,000 300.00% - - Total 6,060,826 6,892,110 14.22% 7,453,162 8.14% 7,816,854 4.88%

Thank You!

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