Sihlalo, hayi obekekileyo kuphela, kodwa nendimthandayo, Malungu ePalamente, Mphathiswa weSebe lezaMandla, neSekela lakhe nabo bonke abanye abaPhathiswa abakhoyo ... (Translation of isiXhosa paragraph follows.)
[Mr S J NJIKELANA: Chairperson, who is not just honourable but also someone whom I admire, Members of Parliament, Minister and Deputy Minister of Energy, and all other Ministers present here ...]
...directors-general, the executive management of the Department of Energy, the state-owned entities and Team Energy as a whole...
... nditsho kuzo zonke iindwendwe zethu, ingakumbi kubafundi abasuka kwisikolo samabanga aphakamileyo iVista. [... all our guests, especially learners from Vista High School.]
I understand I have some guests from Vista High School. It is good to have the young ones learning how we handle things here in Parliament.
Nani nonke baseMzantsi Afrika, ndihlanganisa oosomashishini, abasebenzi nabahlali, ndinibulisa ngezona zishushu xa ndinika inkxaso kwiVoti yoHlahlo- lwabiwo-mali yama-29 yeSebe lezaMandla. (Translation of isiXhosa paragraph follows.)
[My heartfelt greetings to all of you, South Africans, including businesspeople, workers and residents, as I support Budget Vote No 29, that of the Department of Energy.]
In my third budget speech in this august House, I wish to salute the celebration of the 50th anniversary of the Organisation of African Unity, OAU, not only by our government, but also by the whole of Africa. However, we celebrate this 50th anniversary at a time when the spotlight is on the host of global challenges, the risk of inadequacy of supply of energy to meet ever-increasing needs as well as the cost of appropriate technology.
The globalisation of energy demand, as Daniel Yergin claims, reflects the interesting patterns of consumption whereby, in the developed world, the average is 14 barrels per person and in the developing world it is only 3 barrels per person, a glaring disparity that warrants fundamental change, not only in the socio-economic sphere, but also in the political system that creates the framework for energy industries.
Coming to the Southern African Development Community, SADC, region, we can confidently assert that our regional power pooling arrangement is currently the only formalised one in Africa. This is an attribute which reflects a high level of organisation that indicates great prospects and progressive development, as well as a firm base for a formidable supply of energy in future, especially when taking into account the drive for regional integration on trade and industrialisation.
The department continues to participate in the Conference of Energy Ministers of Africa, Cema, within the African Union and regional structures such as the Power Pool System. The All Africa Energy Week in Addis Ababa last year noted that, as Africa's increasingly strong economic performance continues, the continent needs to generate enough energy to power that development.
The Department of Energy has participated, and is still expected to participate in various continental and global bodies such as Cema, as I have indicated, the African Petroleum Producers' Association, APPA; India, Brazil, South Africa, IBSA; the Council of Energy Ministers, CEM; the International Energy Body, as well as the Atomic Energy Agency. Furthermore, partnerships with countries such as Norway, as well as participating in Brazil, Russia, India, China, South Africa, Brics, presents stronger prospects of tapping from those partners, particularly through their formidable resources.
Given the country's predicament of finding alternative sources of oil due to the unilateral imposition of sanctions by the USA against Iran, the department did a sterling job to ensure that such interruption is minimised.
Masibaqhwabele izandla bantu bakuthi. [Kwaqhwatywa.] Ayilulanga laa nto bebeyenza aba bantu bakuthi. [Let us applaud them. [Applause.] What they were doing was not easy at all.]
This a lesson worth remembering and preparing for in future, especially when there are claims that trade between Iran and the USA in other areas is growing, whereas there is this artificial and unwarranted sanction regarding oil.
In any case, Admiral Rickover once asserted that "high energy consumption has always been a prerequisite of political power." With regard to the impact of global politics on the oil trade, may I share what Elliot Abraham asserted. He said:
No other commodity has influenced global affairs as much as oil has. Till this day, oil still remains a major influence in international politics.
He further stressed that, "oil has influenced many countries' foreign relations in major ways".
How will our department benefit from the global energy trade, whilst at the same time contributing to it? Nevertheless, we need to acknowledge that the ANC-led government has steadfastly ensured resonance of and compatibility between the energy trade and its foreign policy throughout. The government has ultimately expressed its position in the new nuclear build programme and we are now clear about what the way forward is. The Minister has already articulated that.
We need to take note of the government's recognition of the growing demand for energy, or electricity supply in particular, and the commitment to address environmental challenges. The government is not only expected to roll out this programme, but also strongly to integrate an industrialisation and localisation strategy, appropriate information- sharing, as well as the requisite training and skills development.
When the manufacture of heavy components in nuclear energy is integrated with the manufacture of light and medium-size components, a deeper level of localisation can be achieved, as we see articulated in the Industrial Policy Action Plan, Ipap. The development and measures that support the nuclear industry designation development, which will be followed by strategy and planning on localisation to support local industry development, has to be on the cards if not already developed.
The ANC definitely takes note of the department's commitment to establish a national radioactive waste disposal institute in the near future. This strengthens the confidence in ensuring responsible management of nuclear waste. The ANC is aware of a lot of differing views on the programme, but equally concerned by dissension among individuals who are part of the collective, that is, government institutions whose positions are publicly known. Whilst we always have the right to dissent and differ, this should be exercised with the prudence it deserves. Furthermore, the debate on costs as well as consideration of baseload power through nuclear energy is very much encouraged with our rider, in any case, of ensuring that such a discourse is based on facts and not propaganda.
At this stage, we await from the department the energy efficiency strategy with great expectations, given the vitality of energy efficiency against the growing demand of power, which at this stage is a challenge to meet. A few initiatives, such as the industrial energy efficiency project, driven by the National Cleaner Production Centre of South Africa, NCPC-SA, and the Energy Efficiency Leadership Network, EELN, are examples of platforms of a formidable public awareness campaign to make energy efficiency an integral part of domestic, commercial and industrial activity whilst being mindful that working together is the only way we can achieve the much-needed gains from energy efficiency.
Last year, we conducted studies and oversight tours, and such tours were on energy efficiency and they focused on security of energy supply and quality assurance. The Aurecon office building in Century City, companies such as Saint Gobain, Creda Communications, Nampak, Hose Manufacturers, the Kuyasa CDM project, the Traffic Centre, and the PetroSA Synthetic Fuels Research Centre at the University of the Western Cape, were visited here in Cape Town.
What we learnt during these visits about the importance of energy efficiency in our journey towards sustainable provision of energy was highly valuable and instructive. I must also express my highest gratitude to the Council for Scientific and Industrial Research, CSIR, for the role it played during these visits.
Every aspect of this good work, resonates with the directives from the Polokwane Resolutions of the 52nd conference of the ANC to ensure "energy efficiency improvements in industry, in households and by setting vehicle efficiency standards as well."
However, it is also anticipated that the department would be allocating, as the very conference directed, significant additional resources for research and development of innovative, clean and low carbon technologies, including retrofitting existing technologies.
In spite of such challenges, the ANC expresses its admiration of the efforts in promoting and advancing energy efficiency and the undying hope that the overall 12% target that was set in 2005 will be met, or at least our performance will be quite close to that.
Let me also share the outcomes of public hearings we held on energy efficiency last year. I will just mention a few. It was considered that energy efficiency programmes have the potential to create jobs, as well as playing a catalytic role for economic growth through local manufacture of energy-efficient products, although that presents some challenges. Some municipalities incorporated energy efficiency into the normal institutional arrangements, a call which I make to the rest of the municipalities in our country.
The Department of Public Works is incorporating energy-efficient techniques into all the new and renovated buildings, albeit slowly. I wish Comrade Thulas was around; he is not, so that he knows. [Laughter.] The EELN is the leading network in driving continuous improvement in energy efficiency, with members taking the lead by showing the best practice.
The Green Building Council was promoting energy efficiency as an easy and low-cost opportunity to save on energy consumption. We need to note that this council has offered to actively support our Parliament in its greening campaign. It is appropriate that we examine the extent to which the government's efforts have fulfilled the commitments related to energy, in so far as the 2009 manifesto is concerned, to ensure our consistency.
I'll just pick one example, that by 2009 the electrification programme had covered 80% of the country's households. We now stand, as the Minister has said, at more than 84%. Out of the current 18 strategic integrated projects, the Minister of Energy chairs one of them, the Integrated Municipal Infrastructure Project; cochairs two of them, one on green energy and the other on electricity transmission and distribution; participates in 10 projects; and has observer status in five projects.
Without any doubt, this expresses the daunting task and enormous load on the department's shoulders and this is a journey that also challenges this committee to monitor fairly closely such enormous work in the short, medium and long term. Recently, this committee adopted the Independent Systems and Market Operator Bill, or ISMO Bill, for consideration by the National Assembly. The core purpose of this Bill is wholesale electricity trading, including the buying of power from independent power producers.
Further, it has to ensure systems are operating and contributing to planning of the new generation capacity. However, let us take a few steps back. In 2007 a master plan was worked out and this master plan took forward an energy White Paper whose aim was to ensure security of supply as one of the critical considerations of government. The master plan proposed interventions necessary to achieve adequacy, given projections about demand growth. Part of the master plan addresses the independent power producers as a matter that has a direct bearing on the introduction of the Independent Systems and Market Operator Bill.
The Independent Systems and Market Operator Bill was drafted in consultation with affected government departments and it was subjected to public participation by both the department and the committee. During these public consultation processes, the issue of independence of the transmission grid, amongst others, was raised. The response of the committee was to refer this matter for further scrutiny, given its significance. Even now, I am making a plea to those sceptics to allow the government to explore various options of addressing the future of the transmission assets, through facts and not propaganda.
Furthermore, the committee is going to recommend to the Minister, through the National Assembly, overall restructuring of the electricity sector as a whole, including addressing the dilemma of the transmission grid. This reinforces the Cabinet decision to restructure the electricity industry as far back as April 2001. The introduction of this Bill signifies the need for intensifying operational efficiency in the electricity sector.
Let me thank the Department of Energy, and express gratitude for the support of the committee and all those who have worked with the committee throughout the past financial year. The ANC supports Budget Vote No 29. [Time expired.] [Applause.]