South African Energy Sector Policy
Research and Capacity Development
Programme
“RSA3001”
RSA3001 Presentation Outline and Schedule
Item no
Responsible
Duration
Opening remarks and welcome:
Deputy Director General
Hydrocarbons Energy Planning
Mr Tseliso Maqubela
15h00-15h10
Presentation by Programme
Manager
Mr Moeketsi Thobela
15h10-15h20
Sub-programme Presentations
CD: Electricity
15h20-15h30
CD: Hydrocarbons
15h30-15h40
NERSA
15h40-15h50
PASA
15h50-16h00
DNA
16h00-16h10
EDC
16h10-16h20
CD: Energy Planning
16h20-16h30
Remarks by NVE
Mr Kjell Repp
Questions/discussions
2
RSA3001Presentation Outline and Schedule
Item no
Speech by the Ambassador
for Norway in South Africa
Speech by Director
General-Department of
Energy
Closing Remarks
Snacks and Drinks
Responsible
H.E Tor Christian Hildan
Duration
16h30-16h45
Ms Nelisiwe Magubane
16h45-17h00
Mr Muzi Mkhize
17h00-17h05
17h05/17h30-
3
Purpose of the Presentation
• To provide an overview of the RSA3001 Programme
• To highlight the key outcomes and achievements of the
Programme
4
RSA3001 Programme Overview
• Programme Goal : To have legislative and regulatory
frameworks in place and implemented, in support of the
DOE’s overall energy goals
• Programme Purpose: The implementation of concrete
interventions towards the establishment of enabling
frameworks for effective governance and regulation,
equitable market liberalisation and sustainable economic
growth
• Duration: 2006-2010
5
RSA3001 Programme Structure - Overview
• Signatories to the Programme Business Plan: Department of Energy (DoE)
and Royal Norwegian Embassy (RNE)
• Implementing Agencies:
– DoE Chief Directorates: Clean Energy, Electricity, Energy Planning and
Hydrocarbons
– National Energy Regulator of South Africa (NERSA)
– Energy Development Corporation (EDC)
– Petroleum Agency South Africa (PASA)
• Norwegian Technical Partners:
– Norwegian Water Resources and Energy Directorate (NVE)
– Norwegian Petroleum Directorate (NPD)
• Programme Themes:
– Regulation/Energy Planning/Climate Change
6
Assessment framework
Efficiency
• Extent to
which
objectives
are met
Effectiveness
• Value of
outputs
compared to
costs
Sustainability
• Effect on
target area/
stakeholders
• Will effect
outlive the
Programme?
Impact
7
Measure
High-level description
Effectiveness
A number of policy, legislative and operational deliverables were realised
Efficiency
Technical support arrangements with NVE and NPD contributed to
expedited implementation of selected activities
Targeted capacity-building at NERSA, PASA, EDC and Energy Planning
was realised
Programme Management Committee (PMC) facilitated quick, better
informed decision making and improved implementation
Impact
Some of the outcomes have been used in effective policy, legislative and
operational changes
Sustainability Systems and outputs created will outlive the Programme
Channels to access international expertise/technology created as a
result of relationships with Norwegian partner organisations
8
Use of funds (amounts in ZAR)
25,000,000
20,000,000
15,000,000
Income
Expenditure
Surplus
Programme Management (PM)
10,000,000
5,000,000
0
2006/7
2007/8
2008/9
2009/10
9
Use of funds
100.00%
98%
86%
90.00%
80.00%
76%
70.00%
59%
60.00%
PM (% of Expenditure)
Expenditure (% income)
50.00%
41%
Surplus (% income)
40.00%
30.00%
20.00%
24%
14%
13.55%
12.80%
8.93%
10.00%
3.16%
2%
0.00%
2006/7
2007/8
2008/9
2009/10
10
Use of funds
Cumulative expenditure - ZAR
45,000,000
40,000,000
42,313,583
35,000,000
28,740,376
30,000,000
25,000,000
20,000,000
18,644,320
15,000,000
10,000,000
7,292,150
5,000,000
0
2006/7
2007/8
2008/9
2009/10
11
If you want to walk fast, walk alone.
If you want to go far, walk together.
- African proverb -
Regulation Theme
Department of Energy - CD: Electricity
Department of Energy - CD: Hydrocarbons
National Energy Regulator of South Africa
( NERSA)
Petroleum Agency South Africa (PASA)
Electricity Sub-programme
(CD: Electricity)
Electricity Sub-programme
• Goal:
– To develop capacity (human and data) to manage and restructure the
electricity sector in support of a transparent, competitive and sustainable
electricity industry
• Purpose:
– The implementation of concrete interventions towards capacity-building for
effective governance and regulation, equitable market liberalisation and
sustainable economic growth and poverty alleviation.
• Outputs:
–
–
–
–
–
Promulgated Electricity Pricing Policy (EPP). First used in MYPD2 process.
Quality of Supply Report
Load-flow model for WC2010 and report
Draft IPP Framework Report
Training (e.g. regulatory training as part of ELRI)
15
Measure
Key examples
Effectiveness
Electricity Pricing Policy (EPP): Used in re-valuing generation assets as
part of the MYPD 2 process.
Load-flow model: Provided indication of reticulation network
constraints around key supply areas of WC2010 host cities and Ekurhuleni.
Draft IPP Framework: Provided input towards the development of
legislation to establish an independent system and market operator
(ISMO).
Efficiency
EPP: Developed by local consultants, thereby reducing cost.
Load-flow model: Co-operation agreement between CD: Electricity and
NVE facilitated an expedited development of the model.
16
Measure
Key examples
Impact
EPP: Improved regulatory certainty could potentially support new
generation investments and energy efficiency.
Load-flow model: Highlighted importance of 11kV system in electricity
supply chain.
Draft IPP Framework: ISMO expected to facilitate IPPs
Sustainability EPP: Will serve as reference for price adjustments in future.
Draft IPP Framework: Development of ISMO legislation will
institutionalise key aspects of the framework.
17
Hydrocarbons Sub-programme
(CD: Hydrocarbons)
Hydrocarbons Sub-programme
• Goal:
– To develop capacity (human and data) to manage and restructure the
hydrocarbons sector in support of a transparent, competitive and
sustainable hydrocarbons industry
• Purpose:
– The implementation of concrete interventions towards capacity-building
for effective governance and regulation, equitable market liberalisation
and sustainable economic growth and poverty alleviation.
• Outputs:
–
–
–
–
–
Strategic Stocks Study
Petroleum Licensing System
Regulatory Accounts and Report
Draft Regulatory Accounting Models for petroleum pricing
Training (e.g. financial analysis as part of petroleum licensing process;
MEETI industry-specific training)
19
Measure
Key examples
Effectiveness
Strategic Stocks Study: Provided options for consideration in developing
Strategic Stocks Policy.
Petroleum Licensing System: Put in place regulations and an enabling IT
system in support of the Petroleum Products Act (PPA).
Regulatory Accounts: Provided a basis for increased transparency in
pricing, as well as regulatory reform in support of the PPA – addressing
regulatory asymmetry.
Efficiency
Strategic Stocks Study: Use of local consultants reduced cost.
Petroleum Licensing System: Increased operational efficiencies.
20
Measure
Key examples
Impact
Strategic Stocks Study: Potential contribution to energy security by
providing basis for policy on crude oil and product stocks.
Petroleum Licensing System and Regulatory Accounts: Contribution
towards managed liberalisation in support of the Energy White Paper
(1998) and the implementation of the PPA.
Sustainability Strategic Stocks Study: Institutionalisation by way of revised Policy
underway
Petroleum Licensing System: Alignment with regulations means system
has been institutionalised.
21
Energy Regulation Subprogramme
(NERSA)
Energy Regulation Sub-programme
• Goal:
– To research and capacitate the framework and mechanisms for
regulation of the energy sector
•
Purpose:
– The implementation of concrete interventions towards the
development of the policy framework and capacity for
sustainable regulation of the electricity sector.
• Outputs:
– Licensing Information System (LIS) operational at targeted
municipalities
– Electricity Regulators Initiative (ELRI) Workshop
– Staff Training Workshop
23
Measure
Key examples
Effectiveness
Licensing Information System (LIS): Use of a web-based platform would
contribute to improved data collection.
NVE-NERSA workshops (including ELRI): Provided a platform to share
regulatory expertise as part of capacity-building.
Efficiency
LIS: The use of NERSA staff members in rolling-out the system resulted
in lower costs.
NVE-NERSA workshop: Holding the NVE-NERSA workshop in SA resulted
in lower costs (e.g. participation by more NERSA staff members).
24
Measure
Key examples
Impact
LIS: Will simplify the information supply process.
NVE-NERSA workshop: Has contributed to the institutional capacity
required by NERSA in regulating an increasingly complex electricity
industry.
Sustainability LIS: Continued use will be supported by the fact that information supply
is a legal requirement, as well as its ease-of-use.
NVE-NERSA workshop: Participation by large number of NERSA staff
members will mitigate effect of staff attrition.
25
Upstream Petroleum Subprogramme
(PASA)
Upstream Petroleum Sub-programme
• Goal:
– Transformation of the core functions of the Agency under the
MPRDA, improve capacity to evaluate resources.
•
Purpose:
– To facilitate a smooth transformation of the core functions of the
Agency under the MPRDA, and facilitate the completion of South
Africa’s Extended Continental Shelf Claim.
• Outputs:
– Institutional Capacity Review/Training Needs Analysis
– Development and implementation of training programme
– Shelf-claim filed
27
Measure
Key examples
Effectiveness
Institutional Capacity Review (ICR): Highlighted PASA’s organisational
weaknesses (e.g. high proportion of staff members due for retirement).
Training Needs Analysis (TNA): Provided basis for the development and
implementation of a training framework.
Continental shelf claim: SA’s continental shelf claim was filed with the
UN. The outcome will be known in due course.
Efficiency
ICR and TNA: Combining these initiatives resulted in a targeted training
programme.
Continental shelf claim: The co-operation agreement with NPD
facilitated access to the expertise required to file SA’s claim.
28
Measure
Key examples
Impact
ICR and TNA: Improved PASA’s ability to quantify petroleum resources,
apply internationally accepted reporting standards and regulate the
upstream sector, including unconventional on-shore gas resources.
Continental shelf claim: A successful claim will double SA’s maritime
territory and potentially increase the resource-base.
Sustainability ICR and TNA: The participation of staff members from across a wider
range of skill and experience profiles – including interns - contributed to
the sustainability of capacity-building efforts.
29
Climate Change Theme
Designated National Authority ( DNA)
Energy Development Corporation (EDC)
Alternative Energy Subprogramme
(DNA)
Alternative Energy Sub-programme - DNA
• Goal:
– Promote and regulate low carbon energy options in a manner
that encourages local economic growth and poverty
alleviation
• Purpose:
– The implementation of concrete interventions towards the of
the development of alternative low carbon energy options.
• Outputs:
– First Annual CDM Tracking Report
– CDM database
32
Measure
Key examples
Effectiveness
The consolidated CDM project database and report provided the DNA
with a first quantitative review of the CDM market in South Africa
Efficiency
The use of local consultants contributed to lower costs. The project was
delivered within the specified budget and one month after the target
date.
Impact
ICR and TNA: The capacity built through the database provides a central
repository for the DoE to monitor CDM development using internal
human resources.
The DNA will be able to evaluate and promote CDM projects as there is
now better understanding of market gaps and challenges.
Sustainability The outputs can be shared with other government departments and
agencies involved in emissions reduction and CDM.
The DoE plans to compile a status report annually.
33
Alternative Energy Subprogramme
(EDC)
Alternative Energy Sub-programme - EDC
• Goal:
– Capacity and policy developed to promote and operationalise low
carbon energy options in a manner that encourages local
economic growth and poverty alleviation
• Purpose:
– The implementation of concrete interventions towards the
development of the policy framework and capacity for
development of alternative low carbon energy options.
• Outputs:
– Institutional Capacity building
– Biofuels Roll-out
– CDM capacity building
– Wind, Solar, Hydro development
35
Measure
Key examples
Effectiveness
Institutional capacity-building: Enhanced EDC’s understanding of RE
technology trends and economics (e.g. biofuels, hydro and wind).
CDM capacity-building: Appointment of a specialist facilitated the
compilation of CDM documentation (e.g. PIN and PDD).
The SSH Guidelines implementation workshop facilitated by EDC has
enhanced capacity to implement policy in support of SSH.
Efficiency
The use of local consultants for the biofuels/hydro feasibility studies and
the hybrid study lowered costs.
Workshops on small scale hydro and wind held in Cape Town and Port
Elizabeth allowed for participation from SA and neighbouring countries.
The workshops were facilitated by NVE in terms of technical support
agreement
36
Measure
Key examples
Impact
SSH: Improved regulatory certainty as a result of the development and
implementation of SSH guidelines.
Capacity building: skills transferred have increased RE development
capacity within EDC
Sustainability Capacity built in CDM, hydro and biofuels development will enable EDC
and its stakeholders to implement low carbon options in future
37
Energy Planning Theme
(CD: Energy Planning)
Energy Planning – DoE
• Goal:
– Secure and sustainable consumption, production and transportation of
diversified energy resources, taking into account interactions with the
macro-economy and natural environment.
• Purpose:
– Develop capacity to enable informed planning, decision-making as a
way of securing sustainable consumption, production and
transportation of diversified energy resources, taking into account
interactions with the macro-economy and natural environment.
• Outputs:
– Energy Security Master Plan (ESMP) Project Plans
– Energy Modelling System User Requirements Specifications
– Capacity building in Energy modelling and planning as well as Energy
Data Management (e.g. in support of the National Energy Act (2008)
39
Measure
Key examples
Effectiveness
Energy Security Master Plan (ESMP): Specified requirements for infrastructure
investments.
National Integrated Energy Modelling System (NIEMS): Resulted in user
requirement specifications which were discussed extensively with various
stakeholders (intra- and inter-departmental as well as SOEs).
NIEMS: Resulted in a governance framework in support of data collection for the
purposes of energy modelling.The framework also provided a basis for the
development of regulations in support of the National Energy Act (2008).
Efficiency
ESMP: Development of project plans via bilateral meetings with industry
participants although time-consuming yielded better quality information.
NIEMS: Adaptation of an existing framework is aimed at contributing towards
reduced development requirements – although will take longer than implementing
an off-the-shelf tool.
Bottom-up development will enable for a system to be customised for South
African context
40
Measure
Key examples
Impact
ESMP: Timely warning of the requirement to coordinate WC2010
planning.
NIEMS: Highlighted importance of separating modelling and planning.
Sustainability ESMP and NIEMS: Experience gained will contribute to the development
of structures, processes and systems to promote energy security, as
envisaged in the National Energy Act (2008).
41
Remarks by NVE
42
Questions/Discussion
43