President Jacob Zuma and Energy Minister David Mahlobo. File Image: IOL

JOHANNESBURG - The Cabinet approved the reviewed integrated resource plan (IRP) on Wednesday, says Energy Minister David Mahlobo. 

The IRP determines South Africa’s long-term electricity demand and details how the demand should be met in terms of generating capacity, type, timing and cost. 

Addressing the media on the sidelines of an energy indaba in Midrand yesterday, Mahlobo cited reduced electricity demand as the only aspect that had changed in the 2010 IRP document. 

“There was an economic downturn. You have to be careful in that you do not create stranded assets,” he said.

The government had conducted sufficient consultation on the document, he said, and would not favour one energy technology over another. 

Since he took over the energy portfolio in October, Mahlobo has come into the spotlight amid allegations that he is pushing for the implementation of the nuclear build programme. 

Opponents of nuclear energy often cite the cost of the technology. Finance Minister Malusi Gigaba said in October that South Africa would not have the money to fund nuclear energy for at least five years.

But Mahlobo said that if a decision was taken on nuclear capacity, the market would give an indication of cost implications. “We will also engage on who funds what.”

He said South Africa had decided on a “measured way” of implementing the IRP.

The implementation in South Africa would be on the basis of pace, scale, affordability and environmental consideration, he said. 

“Until you actually design a bankable project, you cannot wake up and say what is the cost. I am cognisant of the fact that energy has politics… there are too many influencers and lobbyists. 

“Until you have tested the market, you can never be sure,” said Mahlobo. 

Renewable

He also announced that Eskom would sign renewable energy independent power producer (IPP) supply agreements after he and his Public Enterprises counterpart, Lynne Brown, had reached an agreement. 

“Eskom is now sorting out the contracts. The contract is a small issue now,” he said. 

Responding to a question about the controversial sale of strategic fuel stocks, Mahlobo reiterated that South Africa would definitely lose money as a result of the sale. 

He said the country did not have the desired levels of strategic fuel stocks, but declined to be specific, citing national security. 

Speaking at the indaba, President Jacob Zuma said the government would ensure that the country did not experience energy shortages again. 

“In this regard, we will continuously invest in power generation, transmission and distribution infrastructure. We are pursuing our energy security master plan. We are looking at an energy mix that includes coal, solar, wind, hydro, gas and nuclear energy,” said Zuma. 

He and Mahlobo urged the energy sector to hasten the pace of transformation, with Zuma reiterating the government’s decision to pursue radical economic transformation. 

He lashed out at “incorrect and patronising” assertions that the radical economic transformation policy had been developed by “a company from London for the black people of South Africa. The policy originated from the ANC”. 

Zuma was referring to allegations that radical economic transformation was an invention of disgraced public relations firm Bell Pottinger. 

“Radical socio-economic transformation was also declared a government priority for 2017/18 in the 2017 State of the Nation address,” said Zuma. 

He also moved to assure the business community that the upcoming national conference of the ANC would proceed peacefully.

-BUSINESS REPORT