SANF 08 No 09
A ministerial task force on energy established by the Southern African Development Community (SADC) has adopted a road map to accelerate the region’s recovery from the current power shortages, stressing the need for clear milestones and timeframes to measure implementation.
The plan, recognizing that the region is in a power emergency situation, decided to formulate and implement a SADC programme on power conservation and to develop a SADC policy to ensure efficient use of electrical energy.
The SADC Energy Ministerial Task Force (EMTF) on Implementation of Power Sector Programmes, which convened an emergency meeting in Gaborone, Botswana in February, adopted supply and demand management initiatives, as well as the effective use of interconnectors.
The meeting was chaired by Zimbabwe’s Minister of Energy and Power Development, Hon. Michael Nyambuya, and the SADC Executive Secretary, Dr. Tomaz Salomão, gave a briefing on the power supply situation in the region.
The Task Force recognized that high electricity demand has outstripped supply due to, among other factors, the positive economic growth that averaged about five percent in most Member States as well as rural electrification projects in many countries.
They also noted the current status of power supply in the region, which has an installed capacity of 54,742 MW of which only 46,391 MW is available.
Although new generation amounting to 1,810 MW was commissioned in the region in 2007, the reserve margin is still in deficit against a required reserve margin of 10.2%. The situation will continue until 2013 when all planned generation projects are commissioned.
The Task Force agreed that SADC and the Southern African Power Pool (SAPP) would assume direct responsibility for coordinating and monitoring project implementation, and that Member States should make full use of project preparation facilities to package projects.
They decided to commission a study to recommend a financing model for cross-border projects, and to follow up on international pledges made to finance regional projects under the New Partnership for Africa’s Development (NEPAD).
The SADC road map includes the development of a minimum energy efficiency standard for all new electrical connections, implementation of renewable energy technologies, and the phasing out of incandescent light bulbs in preference to the compact fluorescent lights (CFLs).
According to their communiqué, the SADC Energy Ministerial Task Force noted the need to accelerate private sector participation and increase investment in the power sector, and agreed to take action toward achieving an enabling environment.
The ministers reviewed the status of implementation of SAPP generation, transmission and interconnector projects, which are categorized as rehabilitation and related infrastructure, short term, medium term and long term projects. These projects require a total of US$46.4 billion.
In addition, the ministers noted the progress made on the Western Corridor Project (WESTCOR).
They noted the short-term measures instituted by Members States and SAPP to overcome the diminished surplus of installed capacity and the expected impact of these measures, including the recovery plan developed by the South African utility, Eskom, and the power capacity availed by Mozambique for export to the rest of the region.
The Task Force noted that, through its recovery plan, Eskom has achieved a 10 percent load reduction in South Africa, a reduction of power supplied through bilateral contracts by 10 percent, and a saving of 600 MW in demand, specifically in the Western Cape.
The ministers noted that Hidroeléctrica de Cahora Bassa (HCB) in Mozambique has recently concluded a rehabilitation project on all units, resulting in increased availability to 90 percent, thus releasing 300MW to be used on a non-firm basis to alleviate the crisis that the region is facing.
They agreed to work towards the harmonization of national electricity policy frameworks, and to accelerate the pace of electricity supply industry reforms to improve governance and performance.
They also agreed to develop and implement the necessary national policies and promulgate legislation to ensure the promotion of power conservation practices, and to provide financial and fiscal incentives to the utilities for demand-side management.
The recapitalization of power utilities would be achieved through the adoption and implementation of cost-reflective tariffs to allow the utilities and Independent Power Producers (IPPs) to recover production costs.
The ministerial task force noted that, in addition to issues of supply and demand, the power sector is facing additional challenges in financing of power projects and institutional arrangements for implementation.
The EMTF assigned tasks and responsibilities, and agreed that SADC Ministers responsible for Energy will have ultimate oversight of the Power Sector Projects Road Map, while the EMTF itself will review the pace of project implementation.
The SADC Secretariat’s Project Coordination Unit will undertake the strategic coordination of implementation of infrastructure projects, including project development, packaging, monitoring and reporting, in conjunction with Member States, SAPP, the Regional Electricity Regulators Association of Southern Africa (RERA), and key international partners.
Project teams and steering committees will undertake the implementation and review of specific projects. The ministers agreed to strengthen SAPP to ensure that it has capacity for implementation of the roadmap, and RERA to strengthen the regulatory and institutional framework for an enabling environment.
SAPP and RERA were given a new mandate to promote regional power projects in conjunction with SADC Member States.
The Ministerial Task Force stressed the importance of the proposed measures as a response to address the emergency situation, and noted with appreciation the assurance by South Africa to honour contractual obligations for power supply to neighbouring countries.
South Africa has offered to host the next meeting of the task force at a date to be determined by SADC Energy Ministers when they meet on 30 April in the Democratic Republic of Congo.
