MINISTER of Mineral Resources and Energy Gwede Mantashe.     Jairus MMutle GCIS
MINISTER of Mineral Resources and Energy Gwede Mantashe. Jairus MMutle GCIS

SA energy plan nears switch-on

By Dineo Faku Time of article published Oct 11, 2019

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JOHANNESBURG – Mineral Resources and Energy Minister Gwede Mantashe announced yesterday that the government was about to conclude its new long-term plan for the electricity sector, the Integrated Resource Plan (IRP).

Mantashe told the Africa Oil and Power Conference in Cape Town that the plan would lay the foundation for investment in the country's power generation.

“By Wednesday, I am very hopeful that the IRP would be concluded, and we will gazette it,” he said.

“Such an investment should have the impact of lowering the cost of doing business in the country,” he added.

Mantashe said the IRP made provision for gas to power projects, and that the government had announced that the Coega Special Economic Zone (SEZ) in the Eastern Cape would be the site of the first liquefied natural gas import terminal.

The Coega SEZ in Mandela Bay comprises a renewable energy components factory, a gas-to-power plant, a solar rooftop project, and an oil refinery.

“The site will lay the foundation for new gas-to-power plants. It will also be the point of converting existing power plants from diesel to gas.

"We further intend to use the location as a base for importing feedstock for the gas-to-liquid refinery in Mossel Bay,” Mantashe said.

In terms of mining, Mantashe previously said the government intended separating the petroleum resource regulation from the Minerals and Petroleum Resources Development Act.

“To this end, I will soon be tabling a Petroleum Resources Development Bill before the Cabinet,” he said.

The government was convinced that it would add to the economic growth if petroleum was developed into a fully-fledged sector.

Mantashe said the amendment of the Gas Act of 2001 would soon be tabled in the Cabinet.

“We are convinced about the importance of all energy carriers in our energy mix,” he said.

The government was pushing for the reduction of the cost of electricity to save the economy from complete collapse, Mantashe said.

He said that the country had witnessed how high costs and unreliable supply of energy have an adverse impact on the productive sectors of the economy.

“In this regard, we believe that lowering the cost of energy should be a major area of focus in order to enable the growth of the extractive and manufacturing sectors.

"Resource extraction requires vast amounts of energy.

"Consequently, when electricity costs are high, sustaining investment in resource extraction becomes a challenge,” he said.

The minister said in Johannesburg last week that a reliable and secure supply of energy was an urgent priority, and for this reason, the government had started engagements with coal producers and Independent Power Producers (IPPs) to discuss the role of electricity in contributing to economic growth.

He said that the government was talking to coal producers and IPPs to lower their electricity tariffs.


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