Public Works and Infrastructure Minister Sihle Zikalala has tabled in Parliament an R8.7-billion budget for his department for the 2023/24 financial year, which will focus on reforms, decisive action, positive policy direction and confidence restoration in democratic institutions.

Of the overall budget, R2.7-billion has been allocated for the Expanded Public Works Programme (EPWP), aimed at creating jobs, which is transferred to municipalities, provinces and the Independent Development Trust for the non-State sector.

The EPWP provides short-term relief through work opportunities in a variety of sectors. In the 2022/23 financial year, the programme created 990 686 work opportunities, with skills development included, against a target of 1.02-million, translating to a 97% achievement of the target.

Over the past financial year, the EPWP has contributed just under R13-billion in wages to poor households. 

Moreover, Zikalala assured MPs that the Department of Public Works and Infrastructure (DPWI), which managed more than 77 000 properties and 29 000 land parcels, was still implementing the Infrastructure Investment Plan as approved by Cabinet in May 2020, operating as Infrastructure South Africa (ISA) with the help of the national Infrastructure Fund.

To date, 88 special infrastructure projects, or SIPs, have been gazetted covering foundational infrastructure networks in energy, water and sanitation, housing, transport, agriculture and digital communications.

ISA currently has R313-billion worth of projects under construction, while R21-billion worth of projects have been completed under the Infrastructure Investment Plan, mainly relating to roads, energy and human settlement projects.

ISA’s projects in procurement stand at R295-billion.

The energy sector infrastructure project pipeline registered with ISA includes R180-billion related to embedded generation investment, R50-billion related to the Risk Mitigation Independent Power Producer Procurement Programme; R12.1-billion for the Renewable Energy Independent Power Producer Procurement Programme’s Bid Window 6; and R50-billion for the same programme for Bid Window 5.

ISA has already unlocked 225 MW of energy capacity being built by Scatec, valued at R16-billion, as well as nearly 1 GW of solar and wind projects that are being built by Red Rocket South Africa with an investment value of about R9.3-billion.

Zikalala confirmed that the DPWI’s efforts to unlock a pipeline of green hydrogen projects with a value of over R300-billion, were gaining momentum.

“We expect to get the first feasibility reports by September. Petrochemicals company Sasol will soon unveil the first hydrogen plant that will catapult our march into this renewable energy option and ensure that we catch up with the rest of the developed world,” he pointed out.

Among these projects is the Boegoebaai Green Hydrogen project in the Northern Cape, which is poised to create about 35 000 work opportunities.

INFRASTRUCTURE FUND PIPELINE

For the first time in the history of the Budget Facility for Infrastructure (BFI), the allocations for Window 6 were surpassed, owing to the quality of project submissions by the Infrastructure Fund.

The National Treasury has confirmed approvals of blended finance projects through the BFI process, including bulk water projects, with a total project value of R57.7-billion.

The Infrastructure Fund will be structuring and engaging with financial markets to develop financial instruments that will enable investment in projects by private investors and thereby ensure the financial close of these projects, Zikalala confirmed.

The fund is earmarking nine projects, valued at R45-billion, which include the six ports of entry programme, container terminal upgrades and human settlements projects. ISA has been allocated R600-million in the medium term for project preparation, specifically in rural and under-resourced areas.

ENERGY FOCUS

Zikalala further unpacked what is reportedly the largest programme for the procurement of renewable energy and resource efficiency in Africa, called the Integrated, Renewable and Resource Efficiency Programme (iREREP).

Overall, the programme will introduce up to 3.7 GW of equivalent capacity through renewable energy, and usher in the creation of half-a-million jobs, skills opportunities and thousands of small enterprise opportunities.

The DPWI, together with the Ministry of Electricity, supported by National Treasury’s Government Technical Advisory Centre, is finalising the first request for proposals (RFP) under the iREREP programme.

The RFP for the initial pilot phase was approved by Treasury and the last arrangements are under way with the aim being to have the RFP published to the market by the end of June. This will be followed by the convening of a bidders’ conference for interested parties.  

The Phase 1 RFP will help to address electricity and water supply challenges, as well as to reduce waste to landfill.

Zikalala concluded that the DPWI is being repositioned as a key role-player in the Economic Recovery and Reconstruction Plan of South Africa, with a renewed way of working, attitudes and approaches.

He intends to move swiftly in responding to project delays and implementing interventions to remove obstacles hindering infrastructure delivery in the country.