ENERGY STRATEGIC PLAN

1
ENERGY STRATEGIC PLAN 2006/7 MTEF AND DME
SKILLS DEVELOPMENT PROGRAMME
2
TEAM

Adv S Nogxina Director General Mr H Gumede
Chief Director Hydrocarbons Mr T Maqubela
Chief Director Nuclear Mr G Mnguni Chief
Director Management Services Mr T Nell
Director Office of the Director General Ms N
Maphokga- Moripe Director Gender Empowerment
Ms S Makhoba Chairperson of DME Gender Desk Mr
A Otto Director Renewable Energy Mr J Raphela
Chief Director Office of the Director
General Ms T Zungu Chief Compliance Officer
3
THE ENERGY BRANCH

HYDROCARBONS AND ENERGY PLANNING Purpose
Promotion of sustainable use of energy resources
through IEP Key focus areas IEP Introduction
of other forms of energy phasing out of
paraffin Implementation of policies security
of supply of liquid fuels Strategic stock
policy Increase in renewable energy
4
THE ENERGY BRANCH

ELECTRICITY AND NUCLEAR Purpose Development,
monitoring and implementation of policies and
legislation governing the electricity and nuclear
sectors. Key focus areas Security and
diversity of supply Effective electricity
distribution Universal access to
electricity Implementation of radioactive waste
management Development of nuclear energy policy
5
Hydrocarbons 5 Year Plan
Hydrocarbons 5 Year Programmes
To govern the energy sector to be cleaner, safer
and healthier
Redressing Past Imbalances
To contribute to sustainable development through
energy interventions
Operational Energy Information and Petroleum
Licensing Systems
Implementation of Energy economic policies and
legislation

• INTERNATIONALLY COMPETITIVE ENERGY PRICES
  REGULATION
• Petroleum Prod Act
• Gas Act
• Petroleum Pipelines Act
• Energy Bill
• National Energy Regulator Act

Regulation and Enforcement of Certain Elements of
Security of Supply

• Low Smoke Domestic Fuels
• Vehicle Fuels
• LPG

• TRANSFORMATION
• Licensing framework
• Procurement

Alignment of SOEs to Government Policy

• Petroleum Licensing Business System

• Coal Reserves and Resources
• Security of energy supply
• Strategic Oil stocks
• Energy White Paper review
• Gas infrastructure
• Gas Trade Agreements

6
WHITE PAPER ON RENEWABLE ENERGY

White Paper on Renewable Energy (approved by
Cabinet in Nov 2003) spells out Governments
commitment to Creating an enabling environment
for a renewable energy industry in SA (both on
and off-grid) Develop a biofuels industry in
SA Supporting the implementation of specific
technologies Ensuring uptake through the
adoption of a target for renewable energy.
7
RENEWABLE ENERGY TARGET

10 000 GWh (0.8 Mtoe) renewable energy
contribution to final energy consumption by 2013,
to be produced mainly from biomass, wind, solar
and small-scale hydro. The renewable energy is to
be utilised for power generation and non-electric
technologies such as solar water heating and
bio-fuels. This is equivalent to replacing two
(2x 660 MW) units of Eskoms combined coal fired
power stations. OR 1100 million litres of diesel
(14) replaced with biodiesel. This is in
addition to the estimated existing 8-9 renewable
energy contribution mainly from feulwood and
waste. More efficient and sustainable use of
fuelwood and conversion of waste for power
generation will add to the target.
8
RENEWABLE ENERGY STRATEGY MANDATE

White Paper on Renewable Energy (Nov 2003) Way
forward A strategy on Renewable Energy will
be developed, which will translate the goals,
objectives and deliverables set out herein into a
practical implementation plan
9
ANTICIPATED BENEFITS OF MEETING THE RE STRATEGY

A Macro-economic analysis of the RE target
concluded that The target is economically
viable with government financial support and
green funding (e.g CDM, green
premium) Achieving the target could add about
1667 MW new renewable energy capacity with, in
comparison with coal-fired power stations, a net
impact of GDP as high as R1 071m per year,
additional government revenue of R299m,
additional income that would flow to low-income
households as much as R128m, just over 20 000 new
jobs would be created and water savings of 16.5m
kilolitres which translates into R26.6m saving.
10
CURRENT STATUS OF FISCAL SUPPORT OF RE

• Once off capital grants to commercial projects
  (all renewable energy, including biofuels)
• R14.2 m over financial years 2005/6 to 2007/8
• Tax incentive for biodiesel
• Currently 40 concession on general fuel levy
• Accelerated depreciation on assets from 4 to 3
  years
• Environmental fiscal reform policy
• Under review by National Treasury but does not
  yet contain direct support for renewable energies
  (lost opportunity?)

11
RENEWABLE ENERGY STRATEGY DEVELOPMENT

Two distinct strategies have been identified as
key to the implementation of renewable energy -
Large Grid-connected Renewable Energy Strategy -
Biofuels Strategy Development.
12
LARGE GRID-CONNECTED RE TECHNOLOGY UPTAKE

Strategy to support uptake of key grid-connected
technologies such as - sugarcane bagasse
cogeneration - Small-scale hydro - Landfill gas
power production - Solar water heating (energy
efficiency) Strategy proposes introduction of
top-up feed-in tariff to bridge cost gap -
Involves levy on electricity consumption (0.2
0.3 c/kWh) - Phased out scheme that supports
critical mass development of technology and
skills
13
LARGE GRID-CONNECTED RE TECHNOLOGY UPTAKE (cont)

Strategy addresses market rules required to
ensure free and equitable access to the national
grid - pilot project underway to study potential
of voluntary market for renewable energy.
14
BIOFUELS STRATEGY DEVELOPMENT

Cabinet approved in December 2005 the
establishment of a task team to develop biofuels
strategy - Task team convened by the Minister of
Minerals and Energy - Representation from key
departments involved in biofuels - Working
Groups established to provide key input to
strategy development led by relevant
department - CEF (PTY) Ltd and IDC tasked to
investigate investment in commercial projects
that support strategy development Strategy
focuses on two major aspects - Job creation in
the second economy - Development of an immediate
market for biofuels in the formal economy
15
BIOFUELS STRATEGY DEVELOPMENT (cont)

Timelines - Compilation of relevant literature
and pricing model development June 2006 -
Presentation to Cabinet Lekgotla in July 2006 -
Submission to Cabinet in October 2006.
16
OBJECTS OF THE NATIONAL ENERGY BILL

Draft Energy Bill (2006) makes provision for -
establishment of the National Energy Advisory
Committee - establishment of the National Energy
Data Base and Information System - integrated
energy planning function - renewable energy and
energy efficiency matters - energy safety,
health and environmental matters - energy access
by households - international energy
obligations - energy research
17
ENERGY BILL STATUS

Draft Bill was circulated as per Cabinet request
to key stakeholders for comment in 2004 -
substantive comments received - Bill Revised
accordingly Resubmit Bill to Cabinet in
June/July 2006 - request approval to go out for
public comment
18
NUCLEAR FRAMEWORK ISSUES

Continue training of personnel - Internship
Programme at DME and Associated Institutions -
Monitor enrolment in universities - Host
training programmes by the IAEA including WITS RP
course for the African region.
19
NUCLEAR POLICY ISSUES

Development of a Nuclear Energy Policy - Address
position on Nuclear Fuel Cycle - Conduct
feasibility studies on potential uranium
beneficiation projects Address issues on future
Nuclear Build Review the Governance Framework
20
INTERNATIONAL CO-OPERATION

Key for any Development of Nuclear
Infrastructure and Security of Nuclear Supply.
Agreements under negotiation - Argentina -
Turkey - United States - South Korea -
Peoples Republic of China
21
PBMR

Governance of the PBMR is through the Department
of Public Enterprises Success of the PBMR is key
to ensuring security of Nuclear Energy
Supply The NNR is awaiting the Safety Analysis
Report due January 2007 The PBMR Company still
confident of Construction in 2007.
22
NUCLEAR NON-PROLIFERATION

Strengthening of the Nuclear Non Proliferation
Regime. - Regulatory Framework is adequate -
Improve enforcement - Enhance coordination with
other stakeholders Law enforcement agencies and
the Customs and Border Control Commodity
identification training to be provided - Acquire
new analytical tools.
23
SKILLS DEVELOPMENT

A number of initiatives are underway -
WITS-International Atomic Energy Agency (IAEA)
Radiation Protection Course currently running Feb
to July - MSc Programmes in Nuclear Engineering
and Nuclear Technology at North West
University - Around 60 students enrolled for
Nuclear Sector pipeline in universities.
24
THE ELECTRICITY SCENE

Blackouts and brownouts - Used to be mainly
with municipalities - Now also Eskom
transmission (Western Cape) Recovery plan in
place for Western Cape winter of 2006 - Koeberg
contingency plan in place - Rotor installed and
loaded (Eskom) - Other Eskom initiatives involve
LP Gas distribution to shift load Improve
regulatory environment - Electricity Regulation
Act operational from July 2006 - New licensing
framework - Quality of supply norms and
standards - Penalty provisions in the event of
breach of licence conditions
25
THE ELECTRICITY SCENE (cont)

Legislation still outstanding - EDI
Restructuring Bill still has to go to Cabinet for
approval will provide a framework for RED
formation still a voluntary process
Constitution - Dual regulation in terms of the
Electricity Regulation Second Amendment Bill,
dealing with Sec 75 issues - Completes the
regulatory and structural form of the
distribution industry.
26
REDS FORMATION PROCESS

Considers two options relating to formation of
National RED as per Cabinet decision of September
2006 Option 1 anchor using Eskom Distribution
in 3 phased approach Option 2 new entity which
is then populated by business transfers . -
Factors in comments from stakeholders - Keeps
restructuring objectives in check - Provides for
Cabinet Memo with recommendations Resolution of
policy/parking lot issue Mandate for
implementation
27
REDS FORMATION PROCESS (cont)

Information dissemination After Cabinet
decision is finalised. - Provincial energy
forums - NEDLAC - Directly with municipalities
as requested - Communication strategy
28
ELECTRIFICATION

Challenges - Universal access - Funding need
extra R1 billion per annum - Skills capacity
related to accelerated program for 2012 - Also
opportunity for job creation Expanded Public
Works
29
NEW GENERATION CAPACITY

Recall that Cabinet decision requires - Eskom
to do 70 of new generation - Independent Power
Producers (IPP) will do 30 Progress regarding
IPP project - Five companies pre-qualified to
bid - Tender issued in March 2006 - Tender
closes September 2006 - Commissioning expected
before winter 2009. New generation will be
rolled out on basis of investment plan below
between Eskom and IPPs.
30
Installed Capacity Plan


  Base Load (MW) Base Load (MW) Base Load (MW)     Peaking (MW)  
               
Year Camden Grootvlei Grootvlei Komati New Coal Arnot Braamhoek OCGT Total Cumulative
2005 400               400 400
2006 400         60     460 460
2007 600 200 200     90   1027 1,917 1,917
2008 200 400 400 125   60     785 785
2009   600 600 250   60   1000 1,910 1,910
2010       325 630 30     985 985
2011       300 630       930 930
2012         630   1332   1,962 1,962
1,600 1,200 1,200 1,000 1,890 300 1,332 2,027 9,349
               
4
31
NEW GENERATION CAPACITY
32
DME SKILLS DEVELOPMENT PLAN

SKILLS DEVELOPMENT INTERVENTIONS
33
SKILLS DEVELOPMENT INTERVENTIONS

• HRD Master Plan for the Minerals and Human Energy
  Sectors
• Malaysian Scholarship
• Internship Programme
• The Presidential Strategic Leadership and
  Development Programme
• Bursaries, Mentorship and Coaching Programmes
• Petrad (Norway) Liquid Fuels Training Programme
• Electricity Regulatory Initiative
• Masters in International Technology and
  Innovation
• DaVINCI Project Management Development Programme
  2004
• Women in Nuclear Training
• Learnership Development Programme (Inspectors
  Project Management for other Staff Members)
• Various Training Programmes in Line with the
  Workplace Skills Plan
• Sasol Sponsorship Programme
• Anglo Gold Ashanti MDP

34
HRD MASTER PLAN FOR THE MINERALS AND ENERGY
SECTORS

• HRD MASTER PLAN DEVELOPED AND FINALISED DURING
  2005.
• THIS IS A DEPARTMENTAL STRATEGY THAT AIMS AT
  ADDRESSING THE SHORTAGE OF THE MUCH NEEDED SKILLS
  WITHIN THE MINERALS AND ENERGY SECTORS.
• THE PLAN WAS DEVELOPED BY A TEAM OF PARTICIPANTS
  FROM THE DME,SETAS AND ASSOCIATED INSTITUTIONS.
• THIS A LEAVING DOCUMENT THAT WILL CONTINUOUSLY BE
  SUBJECTED TO CHANGES AS DETERMINED BY OUR NEEDS
• THE PLAN WILL BE LAUNCHED IN JULY 2006.

35
MALAYSIAN SCHORLASHIP PROGRAMME

• THE PROGRAMME COMMENCED IN 1999 AS A JOINT
  VENTURE BETWEEN DME AND THE MALAYSIAN GOVERNMENT.
• THE TARGET GROUP IS MATRICULANTS WHO INTEND TO
  STUDY ENGINEERING AND IT/IS FIELDS.
• THERE ARE TEN STUDENTS PER INTAKE EVERY YEAR .
• THESE STUDENTS ARE REGISTERED WITH UNIVERSITY
  TEKNOLOGY PETRONAS IN MALAYSIA.

36
MALAYSIAN SCHORLASHIP PROGRAMME Cont

• IN TOTAL SEVEN-TEEN HAVE GRADUATED FORM THE
  PROGRAMME AND ARE ALL EMPLOYED
• PETROSA HAS EMPLOYED TEN DME ONE,ESKOM
  ONEPUBLIC WORKS ONEMURRAY AND ROBERTS ONE AND
  THREE ARE SELF EMPLOYED
• CURRENTLY THERE ARE THIRTY-SEVEN STUDENTS
  REGISTERED AT THE UNIVERSITY AND TEN OF THEM ARE
  FEMALES

37
PROVINCIAL STUDENT DISTRIBUTTION ON THE PROGRAMME

PROVINCE TOTAL S MALE FEMALE FIELD OF STUDY
GAUTENG 7 6 1 6 Engineering and 1Info System
MPUMALANGA 1 1 - 1 Electrical Engineering
LIMPOPO 9 5 4 7 Engineering and 1Information Technology and 1 Information System
NATAL 8 7 1 5Electrical Engineering 3Chemical Engineering
N. CAPE 1 - 1 1 Information System
E. CAPE 2 1 1 2 Engineering
FREE STATE 5 4 1 3 Chemical Engineering 1Mechenical Engineering 1Electrical Engineering
W. CAPE 1 1 - 1 Information Technology

38
INTERNSHIP PROGRAMME

• Status
  Number
• Total Interns
  222 (Since
  inception )
• Interns absorbed permanently by DME
  34
• Interns absorbed on contract at DME
  23
• Interns offered employment elsewhere
  36
• Interns in the system as at 30 March 2005
  158

39
BURSARY SCHEME MENTORSHIP AND COACHING PROGRAMME

• THE DEPARTMENT HAS ALSO DEVELOPED A BURSARY
  POLICY WITHIN THE FRAMEWORK OF THE PUBLIC SERVICE
  BURSARY SCHEME
• THERE ARE CURRENTLY 228 BURSARY HOLDERS WHO ARE
  REGISTERED WITH VARIOUS UNIVERSITIES FOR CAREERS
  THAT ARE RELEVANT TO THEIR AREAS OF WORK
• SIXTY-FOUR EMPLOYEES ARE CURRENTLY PARTICIPATING
  ON THE MENTORSHIP AND COACHING PROGRAMME

40
PRESIDENTIAL STRATEGIC LEADERSHIP AND
DEVELOPMENT PROGRAMME

• THIS IS A HIGH LEVEL AND ACCREDITED PROGRAMME
  THAT WAS INITALLY DEVELOPED FOR
  DIRECTORS-GENERAL
• DUE TO TIME CONSTRAINTS ON THE PART OF DGs FOR
  THE ATTENDANCE OF THE PROGRAMME A DECISION WAS
  TAKEN TO ALLOW OTHER SENIOR MANGERS TO ATTEND
• THE PROGRAMME IS MODULAR-BASED AND IN LINE WITH
  THE KEY MANEGERIAL COMPETENCIES WITIN THE PUBLIC
  SERVICE AND
• SEVENTEEN SENIOR MANAGERS AT CHIEF DIRECTOR AND
  DIRECTOR LEVELS HAVE ALREADY GRADUATED AT THE
  UNIVERSITY OF POTCHEFSTROOM.

41
LIQUID FUELS TRAINING PROGRAMME AND THE
ELECTRICITY REGULATORY INITIATIVE

• THE LIQUID FUELS TRAINING PROGRAMME IS OFFERED AT
  PETRAD UNIVERSITY IN NORWAY
• TWO OF DME EMPLOYEES HAVE ALREADY COMPLETED THE
  PROGRAMME
• AN INVITATION FOR FURTHER NOMINATIONS FOR THE
  PROGRAMME IS STILL AWAITED .
• THE ELECTRICITY REGULATORY PROGRAMME IS OFFERED
  IN OSLO WITH AN INTAKE OF THREE PARTICIPANTS PER
  ANNUM
• THE PROGAMME IS AIMED AT BUILDING CAPACITY WITHIN
  THE ELECTRICITY SECTOR.

42
MASTERS DEGREE IN INTERNATIONAL TECHNOLOGY AND
INNOVATION

• THE DEGREE IS PROJECT MANAGEMENT ORIENTED WITHIN
  THE PRACTICAL WORK ENVIRONMENT
• IT IS OFFERED THROUGH DaVINCI SCHOOL OF
  MANAGEMENT
• TWO DME EMPLOYEES HAVE REGISTERD FOR THE
  PROGRAMME AND ONLY ONE HAS COMPLETED

43
NUCLEAR TRAINING PROGRAMME

• THERE ARE SIXTY STUDENTS AT VARIOUS TERTIARY
  INSTITUTIONS, IN SOUTH AFRICA AND ABROAD
• STUDIES FOCUSING ON PHYSICS, CHEMISTRY AND
  VARIOUS ENGINEEING FIELDS INCLUDING NUCLEAR
  ENGINEERING.
• WE HAVE 9 MSc GRAUDATES AS INTERNS
• 5 ARE PLACED WITHIN THE DME, AND 4 AT NNR

44
LEARNERSHIP DEVELOPMENT PROGRAMMES

• TWO LEARNERSHIP PROGRAMMES HAVE BEEN DEVELOPED
  WITH A FOCUS ON
• (a) Inspectors of Mines
• Mine Equipment 9 participants
• Mining Engineering 6prticipants
• Occupational Hygiene 4 participants
• Mine Survey 6 participants
• (b) Project Management.
• ONE HUNDRED AND TEN TRAINEES ARE IN THE GRATUATE
  DEVELOPMENT PROGRAMME THAT IS BEING RUN IN
  PARTNERSHIP WITH MQA
• THIRTEEN PARTICIPANTS ARE CURRENTLY ON THE
  PROJECT MANAGEMENT LEARNERSHIP

45
SASOL SPONSORSHIP PROGRAMME

• THE PROGRAMME CAME ABOUT AS A CONTRIBUTION BY
  SASOL TO THE DEPARTMENTAL SKILLS DEVELOPMENT
  INITIATIVE WITHIN THE LIQUID FUELS SECTOR
• THE SPONSORSHIP PROGRAMME ALLOWS FOR FIVE
  PARTICIPANTS AT DIFERRENT LEVELS OF STUDIES
• TWO PARTICIPANTS WILL BE FROM WITHIN THE
  DEPARTMENT WHO WILL BE REGISTERED FOR SENIOR
  DEGREES
• THREE WILL BE SELECTED FROM DESERVING
  MATRICULANTS WHO INTEND REGISTERING FOR JUNIOR
  DEGREES IN THE LIQUID FUELS SECTOR
• THE SPONSORSHIP WILL COMMENCE DURING 2006

46
SASOL SPONSORSHIP AND THE ANGLO ASHANTI
DEVELOPMENT PROGAMMES

• THE PROGRAMME CAME ABOUT AS A CONTRIBUTION BY
  SASOL TO THE DEPARTMENTAL SKILLS DEVELOPMENT
  INITIATIVE WITHIN THE LIQUID FUELS SECTOR
• THE SPONSORSHIP PROGRAMME ALLOWS FOR FIVE
  PARTICIPANTS AT DIFERRENT LEVELS OF STUDIES
• TWO PARTICIPANTS WILL BE FROM WITHIN THE
  DEPARTMENT WHO WILL BE REGISTERED FOR SENIOR
  DEGREES
• THREE WILL BE SELECTED FROM DESERVING
  MATRICULANTS WHO INTEND REGISTERING FOR JUNIOR
  DEGREES IN THE LIQUID FUELS SECTOR
• THE SPONSORSHIP WILL COMMENCE DURING 2006
• FOUR DME EMPLOYEES ARE PARTICIPATING IN A
  MANAGEMENT DEVELOPMENT PROGAMME SPONSORED BY
  ANGLO ASHANTI
• THEY ARE ALL REGISTERED AT THE UNIVERSITY OF
  WESTERN CAPE

47
PROGRAMMES IN LINE WITH THE WORKPLACE SKILLS
PLAN(ONLY FOR INFORMATION)

• Generic Training Courses
• Computer Courses (Ms Word, Ms Excel, Ms
  Powerpoint, Ms Outlook, Ms Project and Ms Access)
• Project Management
• Financial Management
• PFMA and Budgeting
• Service Delivery
• Change Management
• Office Administration
• Effective Writing
• Time Management
• Management and Leadership
• Mentorship and Coaching
• Information and Record Management
• HIV and AIDS Programme
• Records Management

48
PROGRAMMES IN LINE WITH THE WORKPLACE SKILLS
PLAN(ONLY FOR INFORMATION)

• Line Function Training
• Electrical Engineering Mine Seismology
• Economic Analysis Supply Chain Management
• Mechanical Engineering Asset Management
• Environmental management Skills Development
  Facilitation
• Mining and Energy Legislation PERSAL courses
• Energy Economics Contract Law
• Simulation Safe Surface Mines
• Rough Diamond Grading Hygienist Course
• Accident Investigation Ecology Course
• Basic Electricity Database Design
• Land/Quantity Surveyor Environment Finance
• Gas Testing Internal Auditing
• Petroleum Management Risk Management
• Mine Managers Certificate Mine Oversee Course
• Policy Development Evaluation of Mine Pillars

49
THANK YOU