1. BRIEFING TO THE PORTFOLIO COMMITTEE ON ENERGY ON THE IMPACT OF 2016 SONA
23 FEBRUARY 2016
Minister Tina Joemat-Pettersson

2. CONTENT
INTRODUCTION
PRESIDENT’S REMARKS
PRONOUNCEMENTS ON SONA

3. Introduction
Objective is to discuss the impact of the 2016 State of the Nation Address (SONA) on the work of the Department of Energy.
The following are some of the key issues which were outlined in the SONAs of 2016:
 The nuclear energy expansion programme
Renewable Independent Power Producer Programme
Continuous implementation of the National Development Plan,
Improving the management and governance of SOEs;
Spending and management of public funds.

4. During SONA 2016, HE President Zuma stated that:
“The nuclear energy expansion programme remains part of the future energy mix. Our plan is to introduce nine thousand six hundred (9600) megawatts of nuclear energy in the next decade, in addition to running Koeberg Nuclear Power Plant.
We will also test the market to ascertain the true cost of building modern nuclear plants.
Let me emphasise that we will only procure nuclear on a scale and pace that our country can afford”.

5. Nuclear New Build Programme
The impact of the SONA announcement require the Department as Procuring Agent to ensure systems and resources are in place to manage the Nuclear New Build Programme. In response to SONA, the Department will undertake following:
Establish the Programme Management Office (PMO) and systems to manage the nuclear programme.
Appoint Transactional Advisors to advise Department on transaction including Financing and funding, procurement, legal etc.
Develop and approve the procurement strategy.
Issue the Request for Proposals (RFP) for 9600MW Nuclear Programme to test the market and ascertain the cost of build nuclear power plant.
Make recommendations to the procurement governance structures and Cabinet.

6. Nuclear New Build Programme…
Fully resource the PMO with nuclear experts.
Increase Public Awareness and Education to demystify nuclear energy.
Implement Training and Skills Development Strategy for capacity building for the Programme.
Finalize various strategies for the entire nuclear value chain.
Provide oversight and monitor implementation of programme.

7. On Renewable Independent Power Producer Programme, the President said
“The multiple bid windows of the Renewable Independent Power Producer Programme have attracted an investment of one hundred and ninety four billion rand. This initiative is a concrete example of how government can partner with the private sector to provide practical solutions to an immediate challenge that faces our country. In 2016, government will select the preferred bidders for the Request for Proposals will also be issued for the first windows of gas to power bids”.
The Department will issue the request for proposals for the 1st window of gas to power bids in the 2nd quarter of this financial year.
Evaluation of bids for the coal independent power producer will be done within two months.

8. Nine Point Plan

9. On State Owned Enterprises (SOEs), the President said:
“For the state owned companies to contribute to the successful implementation of the National Development Plan, they must be financially sound. They must be properly governed and managed”.
The Department will implement, monitor and evaluate the recommendations of the Presidential Review Commission on State Owned Enterprises (SOEs);
The mandate of the SOEs will be reviewed further and streamlined to ensure that where there are overlaps in the mandates, there is immediate rationalization;
An integrated and comprehensive energy sector specific strategy on SOEs will be developed. The strategy will be informed by the , Nine-Point Plan, NDP, IEP etc
Oversight over SOEs will be strengthened to ensure that they meet the shareholders expectations and implement capital projects within the defined project scope and period.

10. On public spending the President stated:
“We have made an undertaking to spend public funds wisely and to cut wasteful expenditure, but without compromising on the core business of government and the provision of services to our people”.
Cost containment measures currently implemented will be closely monitored to curb any wasteful and fruitless expenditure. Further restrictions on conferences, workshops and catering will be instituted.
A number of meetings will be reduced and conducted via video links where possible.
The size of delegation to events, conferences, Parliamentary briefings and overseas trips will be reduced.
Department will fully comply with further cost containment measures- as may be deemed necessary by the Minister of Finance and we will ensure that SOEs of the Portfolio conform to the measures.

11. Thank You