Speech by Deputy President Mlambo-Ngcuka at the official opening of Gourikwa and Ankerlig Power Stations, Atlantis, Western Cape
1 October 2007

Minister of Public Enterprises, Alec Erwin
Minister Minerals and Energy, Science and Technology, Buyelwa Sonjica
Western Cape Premier, Ibrahim Rasool
Members of Executive Council
Chairpersons of Portfolio Committees, National Electricity Regulator of South Africa (Nersa) Chief Executive Officer
Chief Executives of Siemens
Eskom top management
Western Cape Energy Advisory Committee members

Today marks progress in our quest for greater energy security and energy efficiency. After serious investigations the Open Cycle Gas Turbine (OCGT) was identified as the most viable for this purpose.

An Open Cycle Gas Turbine (OCGT) is a Power Station that can be powered by either natural gas or liquid fuel, kerosene or diesel, and is normally used during peak periods, which is what we need to cope with the demands of our growing economy.

* The technology has been used extensively all over the world and is readily available.
* The Station can be erected in a lead time of two to three years as opposed to the larger coal and nuclear stations that require eight to ten years lead time.
* This type of technology has a proven track record.
* There are numerous suppliers in the world.

This, I hope assures the public of the excellent choice we have made. I want to applaud all the role players in the project. The Atlantis Power Station receives its fuel, diesel, from a supplier in the Greater Cape Town area. The fuel to Atlantis will initially be trucked in with a view to installing a pipeline in the future if required. The one in Mossel Bay will receive its fuel, kerosene, from the Petro-South Africa facilities. Each of the role players plays a key role in the value chain.

This comes against the backdrop of a Memorandum of Understanding (MoU) between Eskom and Petro-South Africa; not only for this project but for a possible Combined Cycle Gas plant should enough gas be available from the promising West Coast exploratory sites.

We continue to support the search for gas on the west coast and to invite and encourage gas exploration, prospecting and development. Our institutions have acquired a lot of experience in this regard.

This event is important as the two new OCGT plants are the first of the power stations to be planned and built by democratic South Africa. Eskom has already used the two stations extensively to supply the demand for electricity during the 2007 winter.

For Eskom’s capacity expansion programme, it is an important achievement in responding to frequent blackouts. Improve the quality of supply in preparation for the 2010 Federation International Football Association (Fifa) World Cup and beyond.
Again, we need our people to know that we have plans to address our energy security.

As Eskom generates, transmits and distributes electricity to industrial, commercial and residential customers their challenge is to satisfy the increasing demand for electricity.

* The success of this is important for "ensuring economic growth and keeping South Africa’s lights burning".
* This peaking generation technology will meet South Africa’s energy consumption needs.

It will also meet international best practice

* short lead and construction times when compared to pumped storage schemes
* will stabilise supply to the province by supporting the existing network.

The two power stations are set to add an estimated 1 027 MW to the electricity supply capacity of the Cape. The total cost of the project is estimated at approximately three and half billion rand (R3,5 billion).
In Accelerated and Shared Growth Initiative for South Africa (AsgiSA), we have highlighted infrastructure as a possible binding constraint to the accelerated and shared growth. Therefore, this project is one of the important enablers for AsgiSA.

We, all of us, need to play our part especially in energy efficiency.

* we must promote energy saving in private and public sectors
* energy efficiency reduces energy costs to the economy
* energy efficiency contributes to sustainable development
* energy efficiency contributes to South Africa’s economic growth and service delivery to the poor.

1. Our responsibility to climate change is South Africa depends a lot on what we do with energy efficiency.
2. Our success on energy security depends on a greater and united national effort on being energy efficient. It must start now!

Context of energy use in South Africa

* in our country we take energy for granted
* our energy consumption are higher than they should be
* our historically low electricity price has provided little incentive to save electricity
* South Africa uses some 40% of the total electricity consumed in Africa.

We must work with Eskom, the Department of Minerals and Energy, the Department of Public Works and the industry to change our consumption. The strategy takes its mandate from the 1998 White Paper on Energy Policy. It aims to contribute to affordable energy for all, minimise the negative effects of energy use upon human health and the environment. The strategy sets a national target for energy efficiency improvement of 12% by 2015. It has to work!

Why do we need this Energy Efficiency Strategy?

* A worldwide phenomena is to rise to a challenge of sustainable energy.
* As a developing country, South Africa has an energy intensive heavy industry.
* Environmental benefits: our country is a high emitter of carbon dioxide gas.
* Energy Efficiency Strategy is a source of job creation and improves working conditions.

Our country has modernised on the strength of strong and efficient energy resources. South Africa can only achieve its developmental goals with a secure and reliable energy use. As a developing country, there is a strong need for securing energy to stimulate economic growth and provide ‘a better life for all.’

Issued by: The Presidency
1 October 2007
Source: The Presidency (http://www.thepresidency.gov.za)