Chairperson, Minister, Deputy Minister, other Ministers and Deputy Ministers present, hon members, ladies and gentlemen, comrades and friends, I hereby rise on behalf of the ANC in support of Budget Vote 29 - Energy.
Hon Chairperson, let me begin by congratulating the hon Tina Joemat- Pettersson on her appointment as the new Minister of Energy. Similarly, I also congratulate the hon Thembisile Majola on her appointment as the new Deputy Minister of Energy.
I dedicate this speech to Chief Albert John Luthuli, the 8th President- General of the ANC, one of the first honoured bearers of the Isitwalandwe/Seaparankwe Award, and Africa's first Nobel Peace Prize Laureate, who departed 47 years ago, on 21 July 1967. In his enduring memory and the memory of the legends of others, like our international icon Nelson Rolihlahla Mandela, we have begun our work in this fifth democratic Parliament, and, indeed, in this second phase of our transition, led by the ANC with its enduring inspiration, to ensure that our country moves forward with speed and clarity to realise our overall goal of a national democratic society.
As someone who was born near a small power station not far from the banks of the Vaal River, and lived in a community that was deprived of electricity for many years, I am deeply humbled to stand here as part of those who now have a responsibility with regard to our national energy security and supply in its entirety. This is an enormous responsibility, which I hope we will all carry out to the best of our ability.
Let me state, at the outset, that a week ago the Portfolio Committee on Energy, despite the time constraints we had, pledged its support for this Budget Vote. During his state of the nation address, His Excellency President Jacob Zuma undoubtedly placed energy at the centre of his second democratic administration. [Applause.]
At its 53rd Mangaung Conference, the ANC declared that we are now boldly entering a second, more radical phase of our democratic transition from apartheid and colonialism to a national democratic society. This phase will be characterised by more radical socioeconomic policies. Consequently, we from the ANC come to this fifth democratic Parliament with a single mind to ensure that this radical second phase finds concrete expression in all the work we do here in Parliament.
It is with this mindset that we will approach our work in the energy sector. In articulating the challenges that our economy and country face, President Jacob Zuma said:
This situation calls for a radical transformation of the energy sector, to develop a sustainable energy mix that comprises coal, solar, wind, hydro, gas and nuclear energy.
The ANC's policies are clear. Amongst others, the ANC will pursue the task of building a capable developmental state that intervenes and is capable of leading a process of fundamental social and economic transformation of our society. This policy approach will apply to the transformation of the energy sector. This is a commitment we have made, and this is a commitment we will keep. During the deliberations of the portfolio committee, we made it clear that the ANC will remain open to constructive engagement and input, but, at the end of the day, it is the ANC that was given an overwhelming mandate to lead our country and its people, on 7 May 2014. [Applause.] Together we must move South Africa forward faster.
There can be no denying that over the past 20 years, especially the past five years, much has been done to bring more energy to our people. Indeed, South Africa is a much better place to live in than it was 20 years ago. This good story applies to the energy sector as well. In less than 20 years, the ANC-led government has extended access to electricity to over 5,8 million households, and thus reduced the percentage of households without electricity from about 50% in 1994 to 14% currently.
At the same time, we are mindful of the very serious energy constraints our economy and country are facing. This is partly, and perhaps largely, because of our successes. Over the past 20 years, the economy has grown threefold, thereby putting immense pressure on our energy supply. Perhaps, faced with challenges of the same nature, our international icon, the late former President Nelson Rolihlahla Mandela, had this to say: "After climbing a hill one only finds that there are many more hills to climb."
As you all know, the energy challenges our country is facing are very serious and require urgent and decisive action. Many of these challenges are immediate, whilst others will confront us in the long term. We have to take action now, but the actions we take today should not compromise the future security and sustainability of our energy supply. In this regard, we agree with one member of this House who says that we have to define the end- state vision for our energy sector.
We have to assist Eskom to keep the lights on. At the same time, we need a concerted national effort to conserve our energy, and work together with our communities. However, whilst communities are encouraged to use solar and gas, demand management is cross-cutting; it should be led by the state and include business as well.
Business must work with labour to improve productivity and co-operation rather than relying on mechanisation, which is a costly substitute for the absorption of labour and may be wasteful from the point of view of our tight energy supply and environmental considerations. We have no option as a country but to move towards less carbon-intensive electricity production by procuring, at least, 20 000 megawatts of renewable energy, as the NDP enjoins.
The fifth ANC administration begins the task of implementing the long-term vision of the nation, the NDP, and the Industrial Policy Action Plan in the midst of a persistently subdued global economic environment. Indeed, by virtue of our economy's deep connection to the global economy, our domestic economy is in turn growing at a subdued rate at the moment.
Thus, this overarching context is emphasising the great urgency of implementing, over the next three years, a range of the R847 billion worth of infrastructure projects - under the National Infrastructure Plan, as outlined in the state of the nation address by President Jacob Zuma - placing it at the centre of our work in the course of this term. The implementation of these projects, in which the energy sector is one of the critical components, will catalyse accelerated growth and development of our economy, whilst transforming the quality of that growth.
We say that the National Infrastructure Plan provides an opportunity for a qualitatively different trajectory of growth because it is intended to lay the foundation for industrialisation and further extension of basic services to our people. Thus, combined with other interventions by the state, it will help the economy to shift away from the entrenched minerals- energy complex, which is largely an extractive and mineral-exporting economy, to a thriving beneficiating industrial base characterised by a sustainable and balanced growth pattern.
As outlined in the state of the nation address, such interventions include measures to address the skewed patterns of ownership and production; the spatial legacies of our apartheid past; and the tendencies of the economy towards inequality, dualism and marginalisation.
No doubt, these features will not recede automatically, or on their own, as economic growth accelerates. One such feature that must be addressed is the monopoly domination in our economy. This remains an obstacle to the goals of economic transformation as it sets barriers to entry for emerging enterprises. It suppresses competition, and thus builds up inefficiencies and stifles expansion. In our case, the disappointing progress with regard to the implementation of South Africa's Liquid Fuels Charter is a case in point.
In order to drive inclusive growth, create employment opportunities and transform society, the most important immediate priority that should be addressed is energy. Achieving security of supply with an appropriate mix is primary, and this means that there must be diversification of our energy options to include coal, nuclear, shale gas, renewables, oil and gas.
To achieve this, requires, among others, resolving a number of issues, including funding. We are confident that the work of the Energy Security Cabinet Subcommittee, which is responsible for oversight, co-ordination and direction of activities for the energy sector, would be critical in resolving these matters in support of the work of the department and its entities.
The discussion on the structure of the energy industry includes appropriate regulatory and other measures that should be addressed with a view to ensure that our overall priority of energy security is not compromised. Eskom will continue to play a critical role in the future supply of energy, including new energy generation initiatives. The role of the private sector would have to be addressed in the context of ensuring an appropriate mix.
The Medium-Term Strategic Framework and the department's annual performance plans reflect the alignment of our overarching plans, namely the NDP, IPAP and NIP. The challenge is in implementation. This requires economic departments that are not just policy and regulatory authorities but that are active agents with the capacity to identify opportunities, challenges and risks at sectoral level as they arise; ensure a rapid and effective response; and monitor implementation and identify blockages as required.
Within the energy sector, the mandate from the overwhelming majority of the electorate is clear. It says that the ANC-led government should lead the country towards producing more, cleaner energy and promoting energy and self-sufficiency, such that there is domestic security of supply of coal to existing and future power stations.
Both traditional and green energy should be expanded to ensure a platform for growth and social inclusion, including the use of nuclear power for energy generation in a safe and environmentally sustainable manner. Additional energy is generated through the completion of large power stations. Solar and wind power feed into the electricity grid to increase our generation capacity and promote environmental sustainability. Further hydroelectric energy is secured domestically and regionally for the national grid.
A further 1,3 million homes have been installed with solar water heaters, bringing the total to 1,75 million houses, covering more than 7 million South Africans. The pace of oil and gas exploration, including shale gas exploration, by the state and other players in the industry have been intensified as part of the country's effort to ensure national self- sufficiency and energy security, while promoting environmental sustainability.
I now want to turn to the Department of Energy and the entities that fall under it. The outlined strategic outcomes of the department that we support are as follows: security of supply by ensuring that energy supply is secure and demand is well-managed; infrastructure development by facilitating an efficient, competitive and responsive energy infrastructure network; regulation and competition certainty by ensuring that there is improved energy regulation and competition in the energy sector; universal access and transformation by ensuring that there is an efficient and diverse energy mix for universal access within a transformed energy sector; environmental assets that are well protected and continually enhanced by cleaner energy technologies; climate change response by implementing policies that adapt to and mitigate the effects of climate change; prudent corporate governance through implementation of good governance practices for effective and efficient service delivery; and alignment of key policies with the objectives of the NDP.
The following are the entities reporting to the department, whose stated work we support: the National Energy Regulator of South Africa; National Nuclear Regulator; SA National Energy Development Institute; SA Nuclear Energy Corporation; Central Energy Fund; and the National Radioactive Waste Disposal Institute, recently established.
The department's key focus areas for 2014-15 that we support are as follows: increasing access to electricity with an additional 265 000 grid connections and 15 000 nongrid installations; increasing momentum on the installation of solar water heating units; finalising the Integrated Energy Plan with more detailed infrastructure plans; addressing maintenance and refurbishment backlogs in the electricity distribution industry; strengthening the liquid fuels industry; and facilitating the process leading to the implementation of decisions taken on the nuclear programme.
Chairperson, having considered the strategic plan and Budget Vote of the Department of Energy, we recommend that the House supports the Budget Vote.
Furthermore, we would like to make some recommendations to the Minister of Energy, which include: conducting an overall assessment of the capacity and funding of the Department of Energy to establish whether the department is correctly staffed and funded to deliver on all the areas that need attention for energy resource development in South Africa; expediting the delivery of the various pieces of legislation and policy documents that are still outstanding - these include the new draft Integrated Energy Plan and Integrated Resource Plan, which are critical for energy planning in South Africa; focusing on the development of key and critical skills in the various sectors of energy, including, amongst others, engineering, nuclear power, renewable sources and electricity distribution; and ensuring that electricity supply security, in the short term, is a priority for the various stakeholders and government departments in order to develop a mechanism that will prevent load shedding in South Africa.
The committee also recommends that emphasis should be placed on the solar water heater programme. The department has envisaged one million units to be rolled out by 2015. Thus far, only 400 000 have been rolled out. Challenges in this regard include local content, the involvement of all spheres of government and maintenance of units.
Other recommendations include: placing emphasis on the roll-out of the national electrification programme; finalising the proposed Gas Utilisation Master Plan, Gump, and reporting regularly on its progress to the Portfolio Committee on Energy; ensuring the restructuring of the Central Energy Fund, including its subsidiary companies, and empowering them to meet the future demands of South Africa; ensuring that the National Energy Regulator of South Africa has the requisite skills and resources able to manage the new nuclear build programme ...