The long awaited update to South Africa’s Integrated Resource Plan (IRP) will be presented to Cabinet for its approval on August 15, Energy Minister Jeff Radebe confirmed on Thursday, adding that the document would provide much-needed certainty for investors in the electricity sector.
The Minister also confirmed that the document, which is undergoing some final technical revisions, will be released for public comment and would also be subjected to stakeholder consultations within the National Economic Development and Labour Council (Nedlac).
However, the Department of Energy does not envisage, at this stage, conducting road-show-style public hearings, as was the case during the first quarter of 2017 with the 2016 IRP Base Case.
That process, came to nought, despite former Energy Minister David Mahlobo insisting in December that Cabinet had approved an updated IRP, which retained the relative contributions of each of the generation technologies included in the current document, known as IRP 2010, with the only adjustment made relating to a decline in South Africa’s demand forecast.
However, following Radebe’s appointment by President Cyril Ramaphosa a new approach was adopted to include revised technology-cost assumptions, as well as changes to the demand outlook.
The department is leading the final technical work, with support from Eskom.
Once the technical modelling is complete, a revised document will be presented to Cabinet in the coming weeks with an associated request that it be disseminated for public comment.
The comments process will be conducted in parallel to the Nedlac consultations with business, labour and community representatives. Following these consultations, the final IRP will be presented to Cabinet for its approval in on August 15.
On receiving Cabinet approval, the updated IRP, which will guide power generation investments for the coming 20 years, will be published in the Government Gazette.
The future role of all generation technologies, including nuclear, would be outlined in the new IRP.
However, Radebe stressed that, besides the IRP, government would also be guided by the April 2017 Western Cape High Court ruling, which declared unconstitutional and illegal the processes previously used to procure new nuclear capacity, as well as three nuclear-related intergovernmental agreements.
It is anticipated that a streamlined Integrated Energy Plan will also be published for comment, outlining South Africa’s broader road map for the energy sector, including for gas and liquid fuels. However, full details on how the liquid fuels and gas sectors are envisioned to evolve will only be provided when master plans for both sectors were gazetted.
Nevertheless, Radebe has already indicated government discomfort with the fact that the country was relying on imports to meet more than one-quarter of its liquid fuels demand. Therefore, he aims to revive discussion on the creation of a new crude oil refinery in South Africa to meet future demand.
Flanked by his leadership team, Radebe said energy should play a catalytic role in attracting new investment and contributing to the $100-billion investment target set by Ramaphosa.
To support the investment drive the President has appointed four special envoys on investment – Trevor Manuel, Mcebisi Jonas, Jaco Maree and Phumzile Langeni – to meet with potential investors ahead of an Investment Conference to be held later this year.
Radebe noted that the recent signing of project agreements for 27 renewable-energy plants would already contribute R56-billion to the investment target and that there remained significant further potential to attract investment into coal- and gas-fired power plants, as well as new liquid fuels manufacturing capacity.