‘SA’s energy plan expected by November, no plan to cancel Kusile’

Engineering News, 25 August 2010

The much-anticipated second Integrated Resource Plan, or IRP2010, originally planned for promulgation in September, is now expected by the end of October or early November, an official from the Department of Energy (DoE) said on Wednesday.

DoE deputy director-general Ompi Aphane said at a Sanea Action for Energy conference in Johannesburg, that the planning process had now progressed to a modelling stage, where the different scenarios, with regard to a range of energy mixes, with one including the possible termination of the R142-billion Kusile coal-fired power station, which is being built in Mpumalanga province. The first unit of the 4 800-MW plant was scheduled to come on line in 2014.

But Aphane emphasised that the cancellation of the Kusile project was only one, of many scenarios, being looked at.

State-owned power utility Eskom said that work and funding options for the Kusile project was continuing, but had not been finalised.

“Eskom is on record saying that in order to plug the gap in electricity supply over the next few years, South Africa needs new base-load power stations like Medupi and Kusile. Funding to complete the Medupi station has recently been approved by the World Bank. However, the significant challenge to security of supply between 2013 and 2017 is the funding of the Kusile project,” said Eskom FD Paul O’Flaherty.

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‘Treasury calls for private sector involvement in electricity’

Engineering News, 26 August 2010

The National Treasury said on Thursday that if it had to fund State-owned power utility Eskom’s entire build programme of R385-billion up to 2013, it would not be able to meet any other priorities in the country.

National Treasury energy director Ronald Chauke said at a Sanea conference in Johannesburg that the government had provided Eskom with funding and guarantees, but that it could not afford to foot the entire bill for electricity expansion in the country.

To date, the National Treasury had given Eskom around R62-billion in funding and R185-billion in guarantees.

Chauke acknowledged the importance of the new build programme, commenting that South Africa’s constrained electricity capacity was stifling the country’s dream of growing its economy by 7% over 20 years, as recently outlined by Finance Minister Pravin Gordhan.

“Energy is the bloodline of any economy, and there is still much work to be done to this regard,” he said.

Currently, the electricity sector contributes about 15% to the country’s gross domestic product growth.

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‘Double-cab carbon tax delayed to 2011, threshold to be higher than for cars’

Engineering News, 25 August 2010

South African consumers would start paying carbon dioxide (CO2) emissions tax on new double-cab pick-ups in the first half of next year, with the implementation of the tax on single-cab pick-ups delayed indefinitely.

It is understood that the delay in the implementation of the tax on the sale of new double-cab vehicles served to allow the local automotive industry to conduct testing on these vehicles to determine their level of CO2 emissions.

It also anticipated that the level at which the CO2 tax would kick in for double-cabs would be significantly higher than the 120 g/km which would be applied for passenger cars, tracking developments in Europe.

The CO2 tax regime comes into effect on all new passenger cars as from September 1. New minibus taxis would be exempt from the tax.

The CO2 tax was expected to earn the national fiscus an estimated R450-million in the 2010/11 financial year. Cars would be taxed, based on their certified CO2 emissions, at R75 a g/km for each g/km above 120 g/km, adding around 2% to 3% to the price tag of a car.

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‘Treasury says double-cabs to be taxed from March 1, at higher threshold and rate’

Engineering News, 26 August 2010

The Treasury confirmed on Thursday that the sale of new double-cab pick-ups would be subject to carbon dioxide (CO2) emissions tax from March 1, 2011.

The emissions tax would still be introduced on new passenger cars from September 1, 2010.

Both the penalty and threshold for CO2 tax on double-cabs would be higher than for passenger cars.

New passenger cars would be taxed, based on their certified CO2 emissions, at R75 for each g/km above 120 g/km, adding around 2% to 3% to the price tag of a car.

The Treasury said that the threshold for double-cabs would be set at 175 g/km, and the tax rate at R100 for every g/km above the threshold.

The Treasury said that the delay in implementation now granted vehicle manufacturers and vehicle importers sufficient time to test and determine the CO2 vehicle emissions of all double-cabs.

The Treasury also noted that passenger cars and double cabs that did not have certified CO2 vehicle emissions data for the purpose of taxation, would be subject to a tax based on a proxy CO2 emission calculation, based largely on engine size. Continue reading

‘CO2 tax possible on all cars, old and new – Gordhan’

Engineering News, 24 August 2010

Government is considering implementing a carbon dioxide (CO2) vehicle emission tax on all cars, both new and old, Finance Minister Pravin Gordhan said on Tuesday.

Speaking in the National Assembly on the Taxation Laws Amendment Bill and related legislation, he said this would be implemented by reviewing the approach to vehicle licence fees implemented by the provinces.

As public transport was improved, higher fuel levies could also be imposed and “we can also demand better quality of fuel” than was  available in South Africa at present.

“All in all there is a place for all these mechanisms if we want to reduce the emission of greenhouse gases and ensure we leave our children with a better legacy when it comes to air quality and reducing the risks of climate change.”

Gordhan said he had recently met with the CEOs of South Africa’s largest vehicle manufacturers.

He had confirmed to them that the CO2 emission tax on new passenger vehicles would come into effect on September 1.

However, he had also taken into account some of their concerns, and therefore, the CO2 tax on double-cab bakkies would be delayed slightly and come into effect on an agreed date “in a few months time”.

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‘Peters confident SA could reach 2013 renewable energy target’

Engineering News, 23 August 2010

Energy Minister Dipuo Peters was confident that South Africa would reach the target of producing 10 000 GWh of renewable energy by 2013, as set out in the renewable energy white paper of 2003.

The target was said to represent about 4% of South Africa’s total generation capacity.

“We may, in view of the rate at which we are proceeding, surpass this target,” said Peters, adding that she has taken up the issue of renewable energy with “greater vigour” since she has taken the helm at the Department of Energy (DoE).

Peters was responding to an article published in the Mail & Guardian (M&G) newspaper, entitled ‘wind power waiting in the wings’, which followed a business breakfast addressed by Mainstream Renewable Power CEO Eddie O’Connor.

According to the M&G article, O’Connor spoke out about the role of the Department of Energy’s “lack of leadership” in the advancement of renewable energy. He also reportedly said that it had been left to the Department of Public Enterprises to take the lead on this issue.

In a statement released over the weekend, Peters said that she “rejected outright the suggestion by Dr O’Connor, that wind is the only source of energy”.

“I reject with the contempt Dr O’Connor’s suggestions. We call on all South Africans, and Dr O’Connor in particular, to realise that wind power technology is not the only available renewable energy technology. There are others as well. We cannot elevate wind power above or at the expense of, other energy sources,” Peters reiterated.

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‘Experts urge faster, more relevant UN climate reports’

Engineering News, 23 August 2010

The UN panel of climate scientists should be more nimble at highlighting global warming trends and at fixing mistakes, experts said ahead of the planned August 30 release of a review of the group’s work.

UN Secretary-General Ban Ki-moon asked for an independent review of the Intergovernmental Panel on Climate Change (IPCC) after the group came under fire for errors such as wrongly saying Himalayan glaciers could all melt by 2035 and overstating the amount of the Netherlands below sea level.

“It is an embarrassing but useful crisis,” said Hans Joachim Schellnhuber, director of the Potsdam Institute for Climate Impact Research, who is not one of those conducting the review.

Schellnhuber and other experts contacted by Reuters said the UN group, which guides government climate policies and shared the 2007 Nobel Peace Prize with US campaigner Al Gore, could play a bigger role in assessing extreme weather such as Pakistan’s floods or Russia’s heat wave in real time.

“There needs to be a more real-time assessment of the climate,” said Kevin Trenberth, head of climate analysis at the US National Center for Atmospheric Research.

One possible format for future IPCC reports could be the US “state of the climate” report, the 2009 version of which was issued in June 2010, he said. Continue reading

‘Mainstream CEO calls for medium-term renewable energy target’

Engineering News, 24 August 2010

The South African government should set a clear medium-term target to fully harness the economic benefits to the South African economy from renewable energy, said Mainstream Renewable Power CEO Eddie O’Connor.

He added that this was the approach adopted by a number of States, including China and the European Union, which have since developed strong renewable energy industries.

Mainstream and a number of other wind energy developers in South Africa were advocating the goal of 25% of the country’s electricity to be derived from renewable sources by 2025.

“Setting such a goal in the Integrated Resource Plan 2010 would result in major skills transfers and job creation benefits to South Africa, as well as avoiding carbon fines and carbon tariffs on South African exports,” said O’Connor.

The comments were made in an open letter to Energy Minister Dipuo Peters, following a statement released by the Minister, which rejected remarks made by O’Connor at a business breakfast hosted by the Mail & Guardian, and a subsequent article in the same publication.

The Department of Energy said that the Minister would deal with O’Connor’s letter, when she returns from China, as she was part of the South African delegation accompanying President Jacob Zuma on his State visit there.

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‘Saldanha could attract investments worth R83bn over 20 years’

Engineering News, 23 August 2010

As the municipality of Saldanha seeks to develop and diversify its economy, the focus is on the concept of it becoming a ‘Clean Technology Bay’, which could see up to R83-billion invested into the area by 2030, creating up to 40 000 jobs.

The Saldanha industrial development hinges on sustainable ‘green’ developments, and covers integrated port management, clean-tech bay framework, the cluster development of renewable energy products, aquaculture, metals, minerals, competence and skills training.

“We wish to set a benchmark of sustainable back-of-port development, which is solely possible by tapping into resources and knowledge that has not been seen in South Africa before,” comments Saldanha industrial development lead consultant Peter Stuivenberg.

The first project worth R11-billion involves the development of some 1 060 MW of energy generation, consisting of 720 MW syngas base-load power, a 100-MW wind farm and a 200-MW solar plant, phased out over ten years.

A 40 Ml/day desalination plant will also be part of these plans.

Affordable energy and water provided over the long term to potential businesses in the area, is seen as an incentive for the manufacturing sector to locate their operations in Saldanha.

The second major project would be the Rare Metals Industries (RMI) – a R10-billion integrated titanium, zirconium and magnesium pure metals refinery plant in Saldanha, on a bilateral and partnership agreement with Russian and American institutions, explains Stuivenberg.

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‘Institutional processes and regulatory risk: A case study of the Thai energy sector’

Abstract: Infrastructure provision the world over has undergone a series of profound changes in the manner of its financing and governance over the last 30 years or so. While the role of the state has diminished as a direct provider, builder and operator of infrastructure, its role as regulator and overseer has undergone substantial growth, increasing the regulatory burden on the state. While this transition has occurred relatively smoothly in developed country contexts, in developing countries the diffusion of the regulatory state has produced manifestly different forms of governance, stressing the regulatory capacity of existing and newly formed regulatory bodies. This paper explores the impact and manifestations of regulatory diffusion in the context of the Thai energy sector and the governance mechanisms responsible for electricity generation, transmission and distribution.

Citation: Jarvis, D. S. L. (2010), Institutional processes and regulatory risk: A case study of the Thai energy sector. Regulation & Governance, 4 (2): 175–202 [Available with subscription from: http://onlinelibrary.wiley.com/doi/10.1111/j.1748-5991.2010.01077.x/abstract]

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