the national planning commission’s - university of cape town … · 2017-05-11 · prof anton...

www.gsb.uct.ac.za/mir

Prof Anton Eberhard Management Program in Infrastructure Reform and Regulation

University of Cape Town

Member of the National Planning Commission

The National Planning Commission’s

Energy Plan for South Africa

www.npconline.co.za


South African Energy Filière

PRIMARY ENERGY SUPPLY ENERGY CONVERSION

SECTORS

DELIVERED

ENERGY/FUELS

ENERGY

DEMAND

SECTORS

ENERGY DEMAND USES

MARINE BUNKERS

URANIUM

COAL

COAL EXPORTS

HYDRO

ELECTRICITY GENERATION

CHEMICAL

COAL

COKE & COAL GAS

ELECTRICITY

COAL

PETROL

AUTOMOTIVE

DIESEL

WASTE EG:

BAGASSE

FUEL WOOD,

CHARCOAL ETC

AGRICULTURE

COMMERCE

TRANSPORT

DOMESTIC

INDUSTRY

LIGHTING

CHEMICAL

HEATING

MECHANICAL

Source: M Beare 2010, adapted from Eberhard, A & Trollip, H (1994)

WIND

SOLAR

NATURAL GAS

BIOMASS

CRUDE EXPORTS

IMPORTED

CRUDE OIL

OTHER PETROLEUM

PRODUCTS

REFINED CRUDE

COKE & COAL GAS

CTL SYNFUEL

GTL SYNFUEL


DEMAND

State

Private


DEMAND

regulated prices market prices


We need an energy sector that promotes

• economic growth and development – Competitive energy prices

– Security of supply

– Quality of supply

– Job creation

• social equity – Expanded access

– Pro-poor tariffs & complementary strategies

• environmental sustainability – Climate change mitigation

– Local environmental controls (air & water quality)

• supported by good governance – Policy, institutions, regulation and competitive markets


The good and the bad since 1994

• Major gains in widening access to electricity from 35% to >80% of households!

• Reliable and cheap electricity until 2005 but new investment too late and now security of supply under threat (generation and distribution) and prices have trebled between 2007 and 2012 (in nominal terms) or doubled in real terms

• Petroleum prices closely track international oil prices, some worries on adequacy of supply infrastructure, slow adoption of international environmental standards


The good and the bad since 1994

• Coal is 4th largest export earner (R50bn in 2011), but exports are stagnating because of inadequate rail infrastructure

• Significant BEE gains in coal mining and exports (above 30%)

• Dependence on coal has increased. 13th largest CO2 emitter globally.

• Energy intensity (kWh/GDP) declining since 1997, but incentives and programmes promoting energy efficiency still modest – between 1.5 - 4 times worse than OECD average

• Renewable energy still minor contributor

Energy issues cut across a number of government departments

DOE, DMR, DEA, DPE, DED, Treasury, DTI, etc

Need for better coordination and more consistent progress


Primary challenges

• Reduction of the carbon intensity

of our energy economy

• Investment for securing supply of electricity, liquid

fuels and gas

• Innovation & job creation in new RE and EE

industries

• Protecting the poor from rapidly increasing energy

prices

• Maximising energy export income


South Africa’s coal fields

Witbank - Highveld

Waterberg

Ermelo

Economically recoverable reserves & resources

66 billion tons of which 48 in Waterberg (CGS, 2011)

Richard’s Bay Coal Terminal


Coal Trade Flows

11


Richards Bay Terminal Capacity Expansion

0

10

20

30

40

50

60

70

80

90

100

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

Cap

acit

y M

t/a

Transnet capacity

Port capacity

Inadequate rail infrastructure is restricting exports



Witbank - Highveld

Waterberg

Ermelo

Ensure domestic security of coal supply for existing power stations

through industry compact and more comprehensive coal field planning

Expand capacity of Richard’s Bay coal line




Witbank - Highveld

Waterberg

Ermelo

Heavy haul rail line needed from Waterberg



Gas

• Go ahead for West Coast gas-to-power

• LNG import infrastructure

• Explore economics of new Mozambique gas pipeline for power and GTL

• Shale gas exploration + plus environmental investigations

Develop National Gas Infrastructure Strategy


Nuclear

• Independent investigation of cost and financing implications, institutional arrangements and time lines

• Plan B (with more gas and renewables) should nuclear costs be prohibitive, financing too difficult and time-lines too short


Renewable energy

• Support procurement of 20,000 MW of renewables by 2030

• Assess sustainability of REIPPP in terms of prices and financing

• Build local capacity for competitive procurement

• Build local industry


ISMO

Restructuring of Electricity Market

Source: Meridien Economics Economics

Eskom

Holdings

C C C

D (Regions 1-6)

KIC C

Mun

KSACS

Mun

Planning

Allocation

Procurement

Buyer

System Operator

Transmission

Scenarios

Determinations

Eskom Gx Imp

Exp IPPs Minister of Energy

Integrated

Resource

Plan

Final PPA


Restructuring of EDI

• Focus on 12 largest cities/towns (who supply 80% of municipal electricity) – Ring-fence electricity businesses

– Implement ADAM

• Eskom or metros to take over non-viable small distributors

• 7 year fiscal plan to deal with maintenance backlog, disbursed via DoE (cf INEP)

• NERSA to enforce annual maintenance spend

• Revise National Electrification Plan


Liquid Fuels

• Upgrade existing refineries to meet new clean fuel standards (with appropriate cost-recovery model)

• Delay investment in new refinery until import deficit warrants efficient scale refinery

• Explore new GTL possibilities

• Invest in regional oil fields


Transition to low carbon economy Already

overshot

carbon cap?


Carbon intensity of electricity sector will fall by a third

40

20

100

0

Coal

CCGT

OCGT

Nuclear

Hydro

Wind

CSP

PV

Capacity installed EoY in GW1

80

60

2030 2025 2020 2015 2010

Sources of energy supply Energy mix

0

100

200

300

400

500

Electric energy supplied in TWh p.a.

Coal

CCGT/OCGT

Nuclear

Hydro

Wind

CSP

PV

2030 2025 2020 2015 2010

912 g/kWh 600 g/kWh

-34%

CO2

intensity

Carbon

free

TWh's

in 2030

(34%)

Renewable

TWh's in

2030

(14%)

Source: South African Integrated Resource Plan 2010-2030 Note: Pumped storage capacity of 1,4 GW in 2010 and 2,7 GW in 2030 is not included since it is a net energy user

22

Integrated Resource Plan 2010-2030



Changing the energy mix

Total additional new capacity (without committed) until 2030 in GW

5

20

15

10

0

Wind

CSP

Solar PV

1,0

Peak -

OCGT

Coa

l

3,9

8,4

9,6

6,3

8,4

17,8

Renew

-ables

Nuclea

r

Gas -

CCGT

2,4 2,6

Hydr

o

25

Integrated Resource Plan 2010-2030

10,1 0,0 0,05 0,0 1,0 1,0

35,5 1,8 2,1 0,0 2,4 0,0

Impor

t

65% 20% 5% 1% < 0,1% 9%

90% 5% 5% 0% < 0,1% 0% Energy

share

2010

2030

15% 23% 6% 6% 9% 42%

Share

of total

new GW

= 260 TWh

= 454 TWh

Committed new

builds

Existing fleet (2010)

23



SA Electricity Prices (1970-2012)

0.00

10.00

20.00

30.00

40.00

50.00

60.00

70.00

1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012

Nominal

Real (2008 values)


What about implementation of the plan?

• Plan handed to President Zuma in Parliament in Aug 2012

• Plan adopted by Cabinet in September 2012

– "If there are inconsistencies, the national plan (NDP) will have an

overriding effect. It's a matter which has been accepted.” Collins

Chabane: Minister in the Presidency

The NPC will:

• Work with DPME and other government

departments to mainstream plan

• Advise government and the broader society

on implementation of the plan

• Help to build constituencies of support for

implementation

• Undertake further research to deepen plan


26

Cycle of

development


Our future -

make it work

NATIONAL DEVELOPMENT PLAN 2030

28 September 2012

the national planning commission’s - university of cape town … · 2017-05-11 · prof anton...

Documents