The Presidency
A second integrated resource plan (IRP2) will be promulgated “by the last quarter of 2010”. Deputy President Kgalema Motlanthe announced this during a reply to questions raised in Parliament yesterday.
The plan will identify energy generation technologies required over the next 20 years to ensure that South Africa’s energy mix becomes more diversified and less coal dominated.
According to the deputy president, the process of revising regulations promulgated under Electricity Regulation Act 4 of 2006 is now complete. The draft regulations, licensing framework and provisions for a standard power purchase agreement – together with evaluation criteria for independent power producers (IPPs) – will be issued by the end of November 2010. This will coincide with the conclusion of the integrated resource plan.
Deputy president Motlanthe acknowledged that resolving Eskom’s conflicting roles as generator and buyer is key to ensuring private sector participation in the plan. He stated that the introduction of “an independent system and market operator” should address this.
“The cost recovery mechanism, in terms of which private sector generators are given the assurance that their costs will be recovered from the electricity tariff over the term of the power purchase agreement, has been concluded in consultation with the National Energy Regulator of South Africa (NERSA),” the deputy minister continued.
According to minister of energy, Dipuo Peters, her department will announce the energy mix once cabinet has approved IRP2.
This commitment formed part of a media statement issued on 21 August, when the minister also referred to "new generation capacity" regulations. These will define the institutional arrangements within which power will be procured from IPPs, including those using renewable energy sources.
Not only will the new regulations expedite the procurement process. They will also “ensure that all future electricity plans are streamlined to correspond with the country's position on the eventual primary energy mix, as stipulated in ANC policy”.
The minister said that renewable energy targets set out by IRP2 will be in line those to be included in the revised white paper on renewable energy, which is currently under development.
Sabinet Cape Town Office
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