Transcript Slide 1
BUDGET REVIEW AND RECOMMENDATIONS REPORT Presented by : Ms N Magubane Director General 12 October 2010 1 DoE Management Team • • • • • • • • • • Mrs. Thandeka Zungu: COO Mr. George Mnguni: DDG: Corporate Services. Mr. Dakalo Netshivhazwaulu: Acting CFO Mr. Ompi Aphane: Acting DDG of Electricity, Nuclear & Clean Energy Mr. Zingisa Mavuso: Acting DDG of Hydrocarbons & Energy Planning Mr. Mohau Nketsi; Senior Manager of INEP BPU Ms. Ditebogo Kgomo: Chief Director of Nuclear Mr. Velile Kweyama: Director Internal Audit Ms Nonhlanhla Ndebele: Office of the Director General Mr. Sifindo Mbebe; Office of the Director General 2 Presentation outline • • • • • Overall Departmental budget review Major funded projects. Personnel budget outlook. Unfunded key activities. Austerity measures adopted to contain expenditures. • Overview of project performance. • Conclusion. 3 Introduction • Objective is to highlight the department’s budgetary and performance review for the first six months of 2010/11, focusing on major programmes. • The presentation has taken into account the following: – Minister's Budget Vote commitments – Department Strategic Plan 2010-11 – 2012-13 4 Overall Departmental budget review Programme Administration 2010/11 Initial R’000 104,205 Roll Overs R’000 Adjusted Allocation R’000 - Expenditure YTD R’000 Exp as % Of Budget 104,205 60,257 57.83 1,558,608 402,196 25.80 Hydrocarbons and Energy Planning 1,558,608 Electricity, Nuclear and Clean Energy 408,817 5,000 413,817 29,132 7.04 Associated Services 3,463,760 56,000 3,519,760 1,618,750 45.99 Total 5,535,390 61,000 5,596,390 2,110,335 37.71 5 Major funded projects TRANSFER PAYMENTS 20 Year Integrated Energy Plan REFSO Transnet Pipelines EDSM - Eskom EDSM - Municipalities INEP - Eskom INEP - Municipalities INEP - Non-grid Original Budget 2010/11 R'000 3,000 20,700 1,500,000 108,900 220,000 1,719,810 1,020,104 124,200 Exp YTD Sep 2010 R'000 0 488 350,000 62,221 57,510 721,116 137,443 879 Act Exp as a % Available of Budget balance Allocation R'000 % 3,000 0.00% 20,212 2.36% 1,150,000 23.33% 46,679 57.14% 162,490 26.14% 998,694 41.93% 882,661 13.47% 123,321 0.71% 6 Major funded projects TRANSFER PAYMENTS Working Energy Project NECSA NNR EDIH Original Act Exp as a Budget Exp YTD Sep Available % of Budget 2010/11 2010 balance Allocation R'000 R'000 R'000 % 20,000 0 20,000 0.00% 574,110 471,709 102,401 82.16% 19,954 8,157 11,797 40.88% 61,582 25945 35,637 42.13% 7 Organisation and establishment structure of Energy Structure No. of posts Interim Structure (initial) 325 Additional funded Positions 206 Filled Positions 458 Vacant posts 73 Total funded posts 531 Unfunded posts 394 Approved structure 925 8 Key unfunded activities Area NERT FIFA tournament Clean Energy operations International Affiliations Accommodation Establishment of SANEDI Total Amount (R’000) 10,000 150,000 3,420 11,000 9,000 17,000 200,420 9 Adopted Austerity Measures • • • • • • • Restriction on international travelling Restriction of internal catering Review of international commitments for affiliations Stringent measures for control of telecommunication costs Review of internship programme Restriction of advertisement on commercial media Review of process for appointment of consultants 10 Project Planned Completion date Financial Implications Comment/Status Electricity Chief Directorate: Progress Integrated Resource Plan December None Draft report presented to Reporting. 2010 2010 IMC –Energy. Draft report released to general public for consultation. Establishment of Independent System and Market Operator (ISMO). July 2010 None Draft Establishment Bill sent to other government departments Electricity Regulation Act, Second Amendment Bill June 2010 None Awaiting finalization of ISMO Bill in order to incorporate and align. DoE 1000MW IPP June 2010 None PPA negotiations 95% complete. Expected Financial Close Feb 2011 Establish Regional Electricity Distributors June 2010 None Directly Cab memo prepared for IMC on way forward. Standard Offer Policy on Energy Efficiency and Demand Side Management. June 2010 None Done and sent to NERSA for implementation. 11 Project Planned Completion date Financial Implications Comment/Status Electricity Chief Directorate: Progress March 2011 None The Strategic Stocks Regulations were published Reporting. for public comments on 23 Development of the fuel strategic stocks policy & the relevant regulations rd Sept. 2010. Deadline for submission of comments is 23 October 2010 The draft Policy is still under discussion in the Department. Development of the LPG Price Regulations July 2010 None The Regulations were Promulgated on 14th July 2010 Review of the fuel specifications & standards March 2011 None A draft position paper is currently under discussion in the Department and would thereafter be presented to the InterDepartmental Task Team. Once considered by IDTT it will be published for public comments. 12 Project Planned Completion date Financial Implications Comment/Status Electricity Chief Directorate: Progress Development of the 25 March 2011 R 4 million The TOR was published on Reporting. 1 October 2010 & year fuel liquid st infrastructure plan compulsory briefing session to potential Bidders will be held on 18th November 2010. The project should be completed within 6 months after signing the contract. Development of petroleum pricing framework March 2011 R2.5 million (2010/11) R200k p.a The Regulatory Accounting Models for BSS, Coastal storage, secondary distribution, and secondary storage and handling has been finalised. The final report will be completed by 22 October 2010. 13 Project Planned Completion date Financial Implications Comment/Status Electricity Chief Directorate: Progress Development of the March 2011 R3 million for Governance structure Reporting. Integrated Energy Plan the energy which includes relevant modelling exercise government departments established. IEP methodology developed and approved Draft plausible futures complete. Development of the Integrated Energy (Implementation ) Strategy March 2011 None Draft IEP Strategy completed and circulated for comment by other government departments. 14 Project Planned Completio n date Financial Implications Comment/Status Electricity Chief Directorate: Progress Development of the March 2012 •R3 million Process of acquiring service National Integrated for phase 1 provider to develop model for Reporting. Energy Modelling System Regulations for the Mandatory Provision on Energy Data March 2011 •R90 million for entire system IEP in progress. None Draft regulations have been gazetted & stakeholder engagement process held. Centralisation of energy data which is currently collected by the Department has started Amended regulations have subsequently been reviewed by State Law Advisors. Stakeholder inputs obtained & amended regulations forwarded to relevant government departments for inputs. 15 Project Planne d Comple tion date Financial Implications Comment/Status Electricity Chief Directorate: Progress Reporting. Establish the South African National Energy Development Institute (SANEDI) March 2012 Publish Energy Digest and Energy Price Report March 2011 2011/12: R491million 2012/13: R601 million 2013/14: R787million R3 million for phase 1 R90 million for entire system None Business case for the establishment of SANEDI updated after input from National Treasury and DPSA Final recommendations made to the Minister Data collection in progress and skeletal structures started 16 Project Planned Completio n date Financial Implications Comment/Status Electricity Chief Directorate: Progress Licensing of petroleum Ongoing None 15, 769 Applications lodged Reporting. since 2006. products 1,200 yearly average ( past 3 years). From April to September 2010 •298 Accepted/processed applications •16 Approved licences • 8 refused applications •Average 52 applications lodged per month. NOTE: 90 days legislated time for application processing. 17 Project report: Non Grid Electrification Programme Start: 01 April 2010 Finish: 31 March 2011 Deliverable Completion date Funding Comment/Status Install 1,000 SHS in Limpopo (Solar Vision) 31 March 2011 R6 million Some areas identified and rollout will start immediately after material delivery Install 4,000 SHS in Central KZN (KeS) 31 March 2011 R24 million More than 50% of areas identified. Installations in progress Install 4,000 SHS in Northern KZN (NuRa) 31 March 2011 R24 million Areas identified and waiting for council resolution. Material ordered and installations will start after confirmation Install 1,500 SHS in Eastern Cape (Ilitha) 31 March 2011 R 9 million Areas are being identified and negotiated with Municipalities. There were delays due to availability of GIS data 18 SWH Roll-Out : tariff funded programme Roll out area Number of Units Remark Nelson Mandela Bay 120 000 Commenced 20 July 2010. 3600 Units already rolled out. Eskom agreed to ring fence the rebate for the 120 000 units. The plan is to roll out 5000 units per month. A launch for the programme is being planned with NMB awaiting Presidency on the availability of the President. Bloemfontein 40 000 MOU signed and 300 rolled already out Kroonstad 40 000 MOU signed Ekurhuleni 120 000 MOU is being finalised. Potchefstroom 8 000 MOU signed and roll out is being finalised. Rollout commences 04 October SWH Roll-Out : tariff funded programme Roll out area Number of Units Remark Mossel Bay 120 000 MOU signed and 400 rolled already out Saldanha Bay Target to be confirmed MOU signed and roll-out commences 04 October KZN (various 270 000 munics) MOU’s have been signed for total of 270 000 in KZN SWH Roll-Out : fiscal funded programme Roll out area Number of Units Remark Sol Plaatje Municipality 5400 Committed 5400. Eskom tender is at advanced stage and negotiations with suppliers now completed. Transfer of funds to ESKOM targeted for 28 October. Roll out expected end of October 2010. Naledi Municipality 5400 Committed 5400. Eskom tender is at advanced stage and negotiations with suppliers now completed. Transfer of funds to ESKOM targeted for 28 October. Roll out expected end of October 2010. Tshwane Municipality 10400 Eskom has been appointed as the roll out agent for the municipality and this project forms part of the Eskom tender Noupoort 6000 Committed 200 units for 2010 financial-year. Proposed inclusion in 2010/11 financial year. Number of Units settled through Eskom rebate programme to date • A total number of 10 600 claims has been received as of end of August 2010 • Eskom confirmed that they have settled 8700 units through the rebate programme. • The reason for the variance (1900 units) between the two figures is because of the delays in the Measurement and Verification process. • Target of total 6500 units for October in Bloemfontein, Kroonstad, Mossel Bay, Potchefstroom and Saldanha Roll out of High Pressure Systems • DoE exploring programme with CEF to make funding available to cover the gap between the consumer willingness-to-pay and the installation cost. • Modelling exercise to be completed endOctober 2010 Spending patterns- INEP (‘000) 2009-2010; 2% 2008-2009; 1% END….. 25