Speaker, hon members and hon Singh, yes, there has been progress with the implementation of the key agreements made at the Energy Advisory Council meeting on 8 December last year.
The Energy Advisor Ccouncil arose out of the Energy Summit convened by the National Economic Development and Labour Council, Nedlac, in May 2008. It consists of government, business, labour and the community as represented at Nedlac. The advisory council is supported by a national electricity response team comprising all social partners.
I would like to highlight some of the key areas of implementation; more details can be obtained from the Minister of Energy. Since the last advisory council meeting, Eskom's generator performance level has improved to the required levels.
In anticipation of increased electricity demand during the Fifa World Cup, a programme was initiated in the host cities to identify critical infrastructure that needed urgent attention. A more comprehensive strategy has since been completed to address the rehabilitation of municipal distribution infrastructure as a specific focus in the current government programme of action.
As to the policy framework for private-sector participation and the introduction of a nonconflicted independent system and market operator, since the last meeting the issues have been addressed through various processes through the Interministerial Committee on Energy that was created through a Cabinet decision. The committee comprises the Departments of Energy and Public Enterprises, the National Treasury, the Departments of Economic Development, Science and Technology, and Trade and Industry, and the Presidency.
The following has been achieved in relation to each of the elements above. The integrated resource plan will be promulgated by the last quarter of 2010. The plan will indicate the generation technologies that South Africa will require over the next 20 years, in a manner that diversifies our energy mix from being coal dominated. The process to revise the regulations promulgated under the Electricity Regulation Act, No 4 of 2006, has been completed after consultation with lenders and potential investors. The draft regulations, licensing framework and standard power purchase agreement provisions, together with the evaluation criteria for independent power producers, IPPs, will be issued by the end of November 2010 to coincide with the conclusion of the integrated resource plan.
Perhaps the most critical element for private-sector participation relates to the resolution of the conflicted role that Eskom plays as both a generator and a buyer. The introduction of an independent system and market operator will address this conflicted role of Eskom.
The cost recovery mechanism, in terms of which private-sector generators are given the assurance that their costs will be recovered from the electricity tariff over the term of the power purchase agreement, has been concluded in consultation with the National Energy Regulator of SA, Nersa.
Concerning solar water heating and a standard offer incentive, one of the other initiatives introduced since the last advisory council meeting involves providing solar water heaters in place of electric geysers to all residential users of hot water.
The public consultation process for the solar water heaters financial incentive scheme was concluded in July 2010. The process will culminate in the determination of the level of the incentive in rands by Nersa and this is scheduled for later this month. I thank you for your attention. [Applause.]