“President Ramaphosa has set us all a target to attract $100 billion of investment into our economy. I would like the energy sector to contribute as a minimum to a quarter of the target set by the President,” said Energy Minster Jeff Radebe.
Radebe was speaking at a stakeholder engagement in Johannesburg earlier today, under the theme Working together towards an Economically Transformed and Sustainable Energy Sector.
Our people’s mandate is very clear on the need to accelerate transformation of the economy. The call for radical economic transformation enjoins us to strive for a higher economic growth #TeamEnergy @Energy_ZA #BeTheLegacy #Mandela100 #MaSisulu100 @GCISMedia @SAgovnews pic.twitter.com/zr5GcvMiPH
— Minister of Energy (@radebe_jeff) June 1, 2018
The minister said the target can be achieved through the following:
- Securing strategic stock through investment in new fuels tanks and in infrastructure required for South Africa to become a major shale gas producer;
- Promoting Natural Gas by designing and building infrastructure required to transport natural gas and liquefied natural gas (LNG);
- Driving towards cleaner fuels by improving refinery assets to meet world class emissions standards;
- And finally, supporting the transition towards electrification of transport, through key strategic partnerships.
“To some this target might seem an impossibility or an ambitious goal but, I am are convinced that this can be done, because we have successfully done it before in the renewables sector,” he said.
From 2014 to 2016, through the Renewable Energy Independent Power Producers Procurement Programme (REIPPPP), South Africa was able to secure investment of $10.8 billion into the renewables sector.
Radebe highlighted that: “This was significantly more than any other African state in the same period, and more recently we have continued growing the renewables sector through the recent signing of the Independent Power Produce (IPP) agreements, securing R56 Billion of investment into 27 new projects.”
He added: “These 27 projects are making a significant contribution to government’s commitments to meaningful black ownership participation and economic transformation. New foreign and local direct investment provides a strong economic growth impetus in support of an economy wanting to lift its head at a time of severe fiscal constraint.
“This investment will certainly have a positive effect and contribute to the much needed jobs in the rural areas where these projects are located.”
In terms of future plans relating to the renewable energy, Radebe revealed that new bid round i.e. BW5 of the Renewable Energy IPP programme will be launched in November 2018 and it is estimated to be 1800MW of similar technologies as in the Expedited Bid Window.
“This could bring another R40 to R50 billion of investment to the country,” he alluded.
The energy minister explained that the bid window has expired and therefore it is necessary to embark on a new bid window, which gives an opportunity to drive the socio-economic transformation agenda.
According to him, there will be specific reference and requirements for women-owned business participation and special opportunities for the youth.
“It is also the intension to direct the socio-economic and enterprise development spend of the IPP programme in a much more coordinated way, which will take into account the different needs of the communities where the projects are and which will allow the impact to be measured,” he said.
Energy mix into the future
He said Liquefied Natural Gas and natural gas to power programmes are still a high priority. Radebe also disclosed that both the SADC Energy Minister and water and Sanitation Ministers will hold a one day workshop on regional gas development.
With regards to coal, the minister noted that the country has procured two projects of 864MW of coal-fired power plants.
He added that coal will bring R40 billion of investment to the country and at least 5 000 jobs during construction.
“The construction phase will be between 48 months to 60 months after signing before first electrons in the grid (not before 2022/23), he stated.
In terms of nuclear, Radebe highlighted its usefulness other than producing energy .
He pointed out that up to a quarter of the medical radioisotopes used in medical diagnosis or treatment “comes from just one nuclear reactor in South Africa: SAFARI-1, which is owned and operated by the South African Nuclear Energy Corporation.”
Read the full statement here Ministers Speech for the Stakeholder Engagement- 01062018