ELECTRICITY REGULATION BILL (Reintroduced)

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ENERGY INTENSIVE USERS GROUP SOUTH AFRICA    

• ELECTRICITY REGULATION BILL (Reintroduced)
• A presentation to the DME
• Parliamentary Portfolio Committee
• 31 October 2005
• by
• Arnot Hepburn
• EIUG Secretariat

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Membership of the EIUG
ELECTRICITY REGULATION BILL PRESENTATION

• Voluntary Association of Large Industrial Energy
  Users termed Contestable Customers.
• Mainly involved in mining, minerals beneficiation
  and heavy industry manufacture.
• Members utilise 40 of electricity sold in South
  Africa.
• Members contribute R1,6 billion per annum to
  electrification and rural supplies through
  tariffs.
• Will provide a large stake in future investment
  to support Governments growth strategy.

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REDs the EIUG Position
ELECTRICITY REGULATION BILL PRESENTATION

• EIUG strongly supports the EDI Blueprint End
  State Model of
• Financially viable and technically competent
  Regional Distributors.
• Distributing to all customers in franchised
  areas.
• Contestable Customers allowed choice of supplier.
• Rationalised and transparent tariffs across the
  country.
• Furthermore
• NERSA need to regulate the entire electricity
  industry.

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Going Forward The EIUG Perspective
ELECTRICITY REGULATION BILL PRESENTATION

• An EDI Restructuring Bill must be passed to
  entrench the Blueprint End State Model.
• The purpose of the Electricity Regulation Bill to
  put in place a framework for
• regulating all electricity suppliers in the
  future.
• for regulating municipal reticulation suppliers
  in the transition period.

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Bill Issues that Require Clarification
ELECTRICITY REGULATION BILL PRESENTATION

• Choice of supplier by Contestable Customers to be
  entrenched for growth and also essential for long
  term business investment decisions.
• Licensing requirements of re-sellers of
  electricity.

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EIUG Observations and Recommendations
ELECTRICITY REGULATION BILL PRESENTATION

• The EIUG believes that
• regulation is required before implementing
  structure.
• the Electricity Regulation Bill and the EDI
  Restructuring Bill are complimentary.
• the successful implementation of the REDs model
  will bring stability to the distribution
  industry, support growth and socio-economic
  development.
• also many municipalities will be strengthened.
• EIUG remains committed to supporting the
  Government in implementing ESI Restructuring.

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Requests for Specific Alterations to The Bill
ELECTRICITY REGULATION BILL PRESENTATION

• Page 4 add a definition for Contestable
  Customer
• Page 4 Line 38 amend to read transmission
  power system means a power system that operates
  at or above 132kV.

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Conclusion
ELECTRICITY REGULATION BILL PRESENTATION

• In conlusion the EIUG considers the following
  three elements to be crucial for the successful
  and sustainable restructuring of the electricity
  supply industry
• Regulatory Legislation is enacted before any
  restructuring.
• Regulatory Legislation enacted ensures the
  desired end state of six independent Regional
  Electricity Distributors.
• NERSA regulates all licenses and approves tariffs
  for all electricity consumers.

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ELECTRICITY REGULATION BILL PRESENTATION

• The EIUG expresses its appreciation for being
  allowed to make an input to Decision Making that
  
• has a direct impact on the whole economy.
• Thank You for Your Attention