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DEPARTMENT OF ENERGY

Integrated National Electrification Programme (INEP)

Select Committee on Economic Development

8 March 2011

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• After 1994 and through the Government’s initiative of RDP (Reconstruction and Development Programme), electrification programme was endorsed.

• In the period 1994 – 2001 electrification was an electricity industry funded programme.

• During 2001 Government took responsibility for funding electrification programme, via funds made available from National Treasury.

• New drive is to increase access to electricity from 81% to 92% by 2014 instead of universal access due to limited resources and competing Government priorities.

BACKGROUND

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To manage the electrification planning, funding and implementation process, with the aim of addressing electrification backlog so as to reach Universal Access.

Our Focus areas

Managing the electrification planning process Managing the electrification funding allocation process Managing the electrification implementation process Monitor the INEP in line with the Energy White Paper, the

Division of Revenue Act (DoRA), Public Finance Management Act (PFMA), Electricity Regulation Act, OHS Act etc.

MANDATE OF INEP

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• Integrate electrification with other Government Departments programmes with the view of addressing Government objective of poverty alleviation and job creation.

• Ensure full participation of Local Government in the planning and implementations process by using IDPs.

• To facilitate greater participation of previously disadvantaged ccommunities in the operations and management of sector activities with a particular emphasis on women, youth and the disabled.

• Ensure effective and efficient service to the Minister of Energy

OBJECTIVES OF INEP PROGRAMME

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ELECTRICITY VALUE CHAIN

POWER STATIONS

GENERATION

TRANSMISSION LINES TRANSMISSION SUBSTATIONS

DISTRIBUTION (< 132 kV)

SERVICE CONNECTION

RETICULATION HV LINE(11 & 22kV)

TRANSMISSION (>132 kV)

RETICULATION LV LINE

(380/220V)

DISTRIBUTION SUBSTATIONS

Electricity is Generated by burning of fossil fuels (coal, oil, or

natural gas), use of nuclear technology and

hydro capability

Transmission networks (or Transmission grids) is carrying

High Voltage electricity between Generation and

Distribution

The distribution networks collect ‘stepped down’

electricity from the transmission networks and

deliver it to Redistributors /End Users

DISTRIBUTION (132/66/33/22 kV)

Customer consumption is measured at the point of supply in KWh. This information is used to measure and bill consumption

levels utilised/sold

The voltage levels of electricity are further transformed to meet Distribution

requirements

1 2 3

MUNICIPALITIES/ ESKOM

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GridNon Grid Universal Access

20A free connectionSolar Home Systems50w free connection

Free Basic Electricity Policy• Indigent households

• Households (rural, urban & farm dweller houses)• Schools and Clinics

APPROACH TO UNIVERSAL ACCESS

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Fiscal

Grid ElectrificationEskomMunicipalitiesNon Grid ElectrificationConcessionaires

Department of Energy

National Treasury

Implementing Agents

• Municipalities and Eskom

• Service Providers

Donor Funding (KfW, EU)

FUNDING MODEL

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NATIONAL BACKLOG (HOUSEHOLDS)

PROVINCIAL BREAKDOWN - BACKLOGS

PROVINCE BACKLOG % BACKLOG INFORMAL BACKLOG FORMAL BACKLOG

Eastern Cape 673,694 19.88% 67,369 606,325

Free State 200,633 5.92% 70,222 130,411

Gauteng 715,195 21.11% 572,156 143,039

Kwazulu-Natal 813,315 24.00% 162,663 650,652

Limpopo 340,064 10.04% 51,010 289,054

Mpumalanga 222,755 6.57% 44,551 178,204

North West 192,774 5.69% 48,194 144,581

Northern Cape 49,375 1.46% 17,281 32,094

Western Cape 180,351 5.32% 126,246 54,105

Total 3,388,156 100.00% 1,159,691 2,228,465

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Level Third Outline

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Outline Level Fifth

Outline Level

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Seventh Outline Level

Eighth Outline Level

• Ninth Outline LevelClick to edit Master text styles

– Second level

• Third level

– Fourth level

» Fifth level

UN-ELECTRIFIABLE INFORMAL URBAN SETTLEMENT

ELECTRIFIABLE URBAN INFORMAL SETTLEMENT (TSHWANE MAHUBE VALLEY)

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TYPICAL EASTERN CAPE TERRAIN

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MTEF ALLOCATIONS AND ESTIMATED OUTPUTS

12:39:22 PM 13

ALLOCATION 2010/11

ESTIMATED CONNECTIONS 2011/12

ESTIMATED CONNECTIONS 2012/13

ESTIMATED CONNECTIONS

(R'000) (R'000) (R’000)

Municipal allocations

R 1,020,104,000 80 000 R 1,096,612,000 80 000 R 1,551,443,000 85 000

Eskom Allocations

R 1,751,780,000 100 000 R 1,902,186,000 100 000 R 1,914,057,000 125 000

Non Grid allocation

R 68,200,000 10 000 R 70,861,000 10 000 R 86,370,000 10 000

Total allocation R 2,840,084,000 190 000 R 2,937,285,000 190 000 R 3,551,870,000 190 000

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ALLOCATION CRITERIA• Backlog status;

• Electrification projects identified as part of the Integrated Development Planning (IDP) process;

• Rural bias;

• Development nodal zones (identified as part of the ISRDS process);

• Past Performance of licensed Distributors;

• Existence of completed houses as a preferred scenario;

• Area status (proclaimed / un-proclaimed); and

• Commitments not addressed during re-gazetting due to unavailability of funds.

1414

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PROVINCE BULK INFRASTRUCTURE

HOUSEHOLDS CONNS TOTAL

EASTERN CAPE R 123,650,500 R 216,207,500 19,466 R 339,858,000

FREE STATE R 34,837,000 R 43,226,000 8,865 R 78,063,000

GAUTENG R - R 77,200,000 14,026 R 77,200,000

KWAZULU R - R 219,851,000 8,985 R 220,501,000

LIMPOPO R - R 128,000,000 26,614 R 128,000,000

MPUMALANGA R 10,000,000 R 57,300,000 9,975 R 67,300,000

NORTH WEST R - R 31,800,000 6,014 R 31,800,000

NORTHERN CAPE R 10,702,000 R 10,653,000 1,900 R 21,355,000

WESTERN CAPE R 5,770,000 R 50,257,000 8,960 R 56,027,000

TOTAL R 184,959,500 R 834,494,500 104,805 R1,020,104,000

MUNICIPAL PROGRAMME (2010/11)

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PROVINCE BULK INFRASTRUCTURE

HOUSEHOLDS CONN TOTAL

EASTERN CAPE R 99,898,376 R 424,378,607 35,036 R 552,280,000

FREE STATE R 0.00 R 39,271,731 3,871 R 38,921,000

GAUTENG R 40,475,040 R 44,032,992 4,671 R 111,705,000

KWAZULU NATAL R 143,834,598 R 270,689,700 20,984 R 409,294,000

LIMPOPO R 10,718,907 R 153,765,288 14,851 R 196,663,000

MPUMALANGA R 0.00 R 114,724,940 7,539 R 107,378,000

NORTH WEST R 25,084,277 R 128,710,377 1,596 R 190,612,000

NORTHERN CAPE R 9,252,240 R 24,731,481 3,711 R 48,318,000

WESTERN CAPE R 35,389,362 R 50,353,885 2,496 R 96,609,000

TOTAL R 364,652,802 R 1,250,659,006 94,756 R 1,751,780,000

ESKOM PROGRAMME (2010/11)

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MUNIC PROGRAMME ALLOCATIONS (2011/12)

Province Backlog Households

Budget Bulk

Infrastructure Departmental

Budget Total Allocation

EC 18.82% R 160,188,800 R 30,000,000 R 30,000,000 R 220,188,800

FS 5.80% R 34,000,000 R 30,000,000 R 6,000,000 R 70,000,000

GP 22.66% R 80,000,000 R 30,000,000 R 76,000,000 R 186,000,000

KZN 23.73% R 232,319,000 R 14,000,000 R 12,000,000 R 258,319,000

LIM 9.36% R 90,400,000 R 10,000,000 R 14,000,000 R 114,400,000

MP 6.61% R 65,187,550 R 18,250,000 R 3,562,450 R 87,000,000

NW 5.69% R 40,794,000 R 4,000,000 R 7,206,000 R 52,000,000

NC 1.45% R 2,612,200 R 24,000,000 R 20,000,000 R 46,612,200

WC 5.88% R 20,092,000 R 30,000,000 R 12,000,000 R 62,092,000

TOTAL 100.00% R 725,593,550 R 190,250,000 R 180,768,450 R 1,096,612,000

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ESKOM ALLOCATIONS (2011/12 )

PROVINCEBULK

INFRASTRUCTURE

HOUSEHOLDS Pre-ENGINEERING

CONN TOTAL

EASTERN CAPE R 170,732,045 R 368,066,871 R 7,167,248 25,385 R 545,966,166

FREE STATE - R 16,685,340 R 8,215,133 2,377 R 24,900,473

GAUTENG R 6,173,395 R 137,397,401 R 1,053,158 13,454 R 144,623,956

KWAZULU R 155,904,827 R 280,083,587 R 14,250,000 15,725 R 450,238,415

LIMPOPO R 23,088,740 R 155,287,051 R 6,193,143 14,634 R 184,568,935

MPUMALANGA R 17,100,000 R 91,201,524 R 2,977,680 6,891 R 111,279,204

NORTH WEST R 9,381,048 R 110,041,858 R 8,098,535 8,816 R 127,521,442

NORTHEN CAPE - R 55,754,561 R 2,175,512 5,817 R 57,930,074

WESTERN CAPE R 29,265,063 R 53,783,137 R 6,857,283 6,304 R 90,265,484

TOTAL R 402,264,073 R 1,268,301,335 R 56,987,696 99,403 R 1,737,294,153

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NON-GRID PROGRAMME

SERVICE PROVIDER SERVICE AREA NUMBER OF PLANNED INSTALLATIONS

KwaZulu Energy Services Central KZN 4,000

NuRa North KZN Districts 4,000

Solar Vision LImpopo 1,000

Ilitha CooperativeNorth of Eastern Cape (Matatiele, Umzimkhulu, Umzimvubu)

1,500

TOTAL KwaZulu Natal, Limpopo, Eastern Cape

10,500

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SOCIO-ECONOMIC INDICATORS

INDICATOR TARGET ACTUAL % ACHIEVED AGAINST THE TARGET

Total number of Jobs 5000 5,811 116

BEE/BWO/SMME expenditure (50% of amount allocated)

R 504,731,218 R 363,901,989 36

Youth (18 to 35yrs) Employment (50%)

2500 3,271 131

Women (36 yrs and above) Employment (30%)

1500 78 5

Employment of people with disability (2%)

100 13 13

Men (36 yrs and above) Employment (18%) 900 1,480 164

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Jobs created to date

Province Total Male Total Female Disabled Youth Total Employment

EC 400 38 13 251 438 FS 253 14 - 67 267 GP 1,107 93 - 600 1,200

KZN 1,288 98 - 881 1,386 LP 410 100 - 162 510 MP 254 74 - 190 328 NW 1,337 154 - 1,032 1,491 NC 151 1 - 89 152 WC 39 - - 6 39

Total 5,239 572 13 3,278 5,811

SOCIO-ECONOMIC INDICATORS

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SOCIO-ECONOMIC INDICATORS

PROVINCEYEAR TO DATE ACTUAL EXP

BEE/BWO/SMMEXPENDIT

URE

% OF BEE/BWO/S

MME VS. YTD EXP

BWO EXPENDITURE

%BWO OF BEE/BWO/ SMME EXP

NO OF COMPANIES BENEFITED

EC 245,801,200 134,454,491 55 67,783,890 50 7

FS 31,758,516 13,830,206 44 1,882,577 14 5

GP 37,804,231 33,740,688 89 5,071,144 15 20

KZN 315,176,259 107,245,574 34 50,188,891 47 14

LP 137,305,653 22,504,599 16 4,100,338 18 8

MP 68,936,432 12,492,080 18 3,195,353 26 3

NW 95,977,345 22,183,321 23 6,461,852 29 27

NC 25,505,222 4,610,550 18 182,840 4 7

WC 51,197,579 12,840,480 25 6,663,238 52 2

Total 1,009,462,437 363,901,989 36 145,530,122 40 103

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• Insufficient programme funding

• Building of new bulk infrastructure in rural areas

• Refurbishment and rehabilitation of electrical infrastructure

• Building municipal capacity without negative impact on service delivery

• Structured Planning approach (COGTA, Human Settlement etc)

• Project Management

• Resources Management (Contractors, Consultants, etc)

• Technology Innovations (integration of other sources of energy)

• Unacceptability and misconceptions about off-grid technology used on SHS which lead to vandalism of systems.

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UNIVERSAL ACCESS (CHALLENGES)

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VANDALISM EXPERIENCE

Vandalised

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• 92% target by 2014 is more realistic under the current conditions.

• Low backlog municipalities and provinces (NC, FS and NW) will reach universal access by 2012/13 FY.

• Metros and Informal settlement strategies will provide more focus and differentiation of rural and urban backlogs.

• Focused approach on bulk infrastructure, specially in rural areas will cause a slight decrease in current connection figures, but will have a very positive effect within the next two years.

• Political drive is required for the non-grid programme to continue existing.

CONCLUSION