HomeIndustry SectorsFinance and PolicyS.Africa: Mid-term budget speech shows increase in household electrification

S.Africa: Mid-term budget speech shows increase in household electrification

Minister of Finance, Nhlanhla Nene
Nhlanhla Nene delivers 2015 mid-term budget speech, highlighting countries mixed basket of triumphs and shortfalls

On Wednesday, South African finance minister, Nhlanhla Nene, delivered his 2015 mid-term budget speech, where he highlighted that the country’s “share of households with basic access to electricity has increased from 77% to 86%.”

This 9% increase is significant, especially during a period where economic growth has been slower  (1.7%) than projected in February (2%) this year, which part has been attributed to the country’s “energy constraint and structural weaknesses in our economy”, Nene said.

While not directed at the energy sector per se, Nene stressed that South Africa needs to increase its current level of investment, “we have to modernise technology and compete effectively  in the global economy.”

Carbon neutral society

This would be relevant to the South African power industry where targets of becoming a carbon neutral society, becoming less dependent on the national electricity grid and creating local industry are of high importance to ensure an energy secure future for the country.

Touching on the Department of Energy’s independent coal and gas power projects, Nene noted that government has introduced a Project Preparation and Development Facility for the SADC to facilitate and drive these initiatives amongst other sector projects.

This facility will be managed by the Development Bank of Southern Africa.

Later this month, Nene noted that a draft bill will be released for debate on the design of the carbon tax policy.

“This forms part of a package of measures which Minister Molewa will take to the United Nations Climate Change Conference later this year. This package is intended to ensure that South Africa makes a fair contribution to global efforts to reduce greenhouse gas emissions.”


When addressing fiscal policy and the budget frame work, the minister said that government was in the process of developing a better approach to capital project appraisal and the financing of major infrastructure investments.

This will be subjected to departmental initiatives, state-owned companies, municipalities or independent investors.

“Well-informed selection of projects is a key step in enhancing the productivity of infrastructure services,” he added.

Ashley Theron
Ashley Theron-Ord is based in Cape Town, South Africa at Clarion Events-Africa. She is the Senior Content Producer across media brands including ESI Africa, Smart Energy International, Power Engineering International and Mining Review Africa.