3. Policy

3.1. IRP

Following the gazetting of the Integrated Resource Plan (IRP2016) (assumptions, base case and observations), the EIUG presented its preliminary review of the document at the public hearings in December 2016. The review found three key flaws in the assumptions used for the IRP2016 Base Case:

• The demand assumptions;
• The cost assumptions; and
• The annual caps placed on renewable resources

The group and other associations have undertaken a more detailed review of the available information in the IRP2016 and commissioned technical work from industry experts to support our comment. The EIUG has also engaged with the Council for Scientific and Industrial Research’s (CSIR) Energy Centre on the development of their Electricity Scenarios.

The draft EIUG comment has been circulated to EIUG and ITTCC members for final comments before the document is approved and submitted to the DoE, by close of business on 31 March 2017.

Extensive external stakeholder engagement with other associations, multi-media and civil society is planned following the submission of the EIUG comments.

3.2. IEP

The draft Integrated Energy Plan (IEP) was tabled for comment at the same time as the IRP and given the same extension for comments from the public. As with the IRP, the main concerns identified were:

• Accuracy of data and modelling, and
• Inconsistency between the IRP and IEP

Business again commissioned a detailed analysis of the IEP, the findings of which have been used to support the EIUG’s comments.

3.3. NEES

The National Energy Efficiency Strategy (NEES) for post-2015 was published for public comment earlier this year. The EIUG submitted high-level preliminary comments in January 2017, following this, the Department of Energy (DoE) issued an extension and published the annexures that informed the document. The EIUG submitted updated comments at the end of February 2017 following input from members of the EIUG and ITTCC.

On 7 March 2017, BUSA/BLSA hosted a workshop with DoE to discuss the NEES. At this workshop, the DoE clarified that there is no obligation on the sectors to meet these impacts and targets. The strategy is intended to outline the DoE’s targets. Some of the measures listed in the document have been identified as means to reach the targets, however, these will be subject to feasibility studies and further stakeholder engagements.

The DoE also confirmed that the updated Energy Management Plans and Reporting Regulations are being drafted and these will be shared with Business before promulgation. The department further confirmed that they would consider the reporting regulations and requirements for mitigation plans that would be published by the Department of Environmental Affairs (DEA), and ensure alignment between the two and minimise any duplicate requirements.

3.4. Electricity Regulation Act Draft Licencing and Registration Notice

The draft licencing and registration notice was published in December 2016 for public comment and initially seemed benign. However, further review led to concerns that this notice would require operations (that currently are exempt) to apply for a licence or register with NERSA. EIUG members were alerted to the notice at the AGM, and the EIUG Council agreed on the appointment of an energy legal expert to prepare comments on the group’s behalf. These have been submitted to the DoE with an appeal for consideration and published on the portal.

The comments state in conclusion, that it is difficult to see how the proposed exemption and registration provisions will benefit EIUG members. As mentioned above, the installed capacities in the first three exemptions make no sense regarding large generators; the deletion of the current exemption for own use, prejudices existing generators who consume their own electricity. The ultimate effect likely being an increase in the prices of electricity. The anticipated outcome of the proposed exemption and registration provisions is that more and more electricity will be supplied by Eskom, with rapidly increasing prices. This will then influence the pricing of products produced by these intensive users going forward, which could well adversely impact their ability to compete in the global market, to the detriment of the economy and the country as a whole.