House Chairman, the answer to the first question under question 309 is as follows. No, the government approval included the approval of the support framework for Eskom. The support framework was negotiated in parallel with the rest of the other approvals required for the Window 1 financial close. However, the department has already received the required approval under the Public Finance Management Act, PFMA, to commit the Revenue Fund from the Minister of Finance. In addition to the approval under the PFMA, the Minister of Finance has also signed the support framework for Eskom in relation to the renewable energy programme.
The signed Eskom support framework provides for further attachment in relation to the subsequent round and there is no need to negotiate the whole agreement again. This will assist in avoiding delays with regard to the subsequent windows, in particular the required government approvals. The signing of the renewable projects under Window 1 will take place on 5 November 2012. The department believes that almost all the 28 preferred bidders under Window 1 will be signed accordingly without challenges. This can only be confirmed on the date of signature.
In regard to the second question, yes, given that some of the bids will expire at the end of October 2012, there is a necessity to extend the bid validity until the end of November to allow for the implementation agreement, direct agreement, and power purchase agreement on 5 November, and the rest of the other documents with the lenders and contracts will follow. Thank you.
Hon Minister, we are pleased to hear that things are moving forward with this. Project participants have had the feeling that government has somehow been dragging its feet around the issue of alternative energy. Is government still committed to expanding alternative energy, or has there been a change in thinking? Thank you.
South Africa - South Africans in particular - and the whole world know that South Africa has in its Integrated Resource Plan, IRP, about 40% renewable energy, which comes to about 16 400 units of renewable energy from wind and solar energy. So, there is no way in which you can say in this House, where we all know where we stand, that we are backtracking. Those who believed that we were not committed to this have now actually come to the fore and said, "We are sorry - we actually have to acknowledge that South Africa's renewable plan is the best in the world." Thank you very much.
House Chair, the Minister said "the best in the world", and indeed we hope it will be so. World experience tells us that a renewable energy programme does not rely only on the large independent power producers, but even on the small independent power producers. And a number of households on a large scale, as is happening in Germany for instance, could be very significant contributors to the overall renewable energy plan.
One of the key aspects to making that happen is reverse meters, which is something that people like me have been advocating and putting to Eskom for about four years now. There is a steadfast policy against reverse meters. Reverse meters would enable each and every one of us to have a solar panel, cutting the costs of a very expensive battery system, which is the most expensive part of a solar panel system. It feeds energy back into the system so that Eskom becomes the battery.
The question, Minister, is: Have you considered this steadfast policy against reverse meters?
Hon member, state your question.
Will we have reverse meters and what is the justification?
I was saying, hon member, you should state the question. Your time has expired.
I have, thank you.
I have heard what the hon Oriani-Ambrosini has spoken about, but we should remember that in South Africa we have a community of people who, as we speak, still do not have access to energy. When we speak about reverse meters, we should know that it is only those who already have electricity at present that would actually be able to benefit from the initiatives that we are talking about.
This does not actually preclude us from considering alternatives. We are busy dealing with what we call the Standard Offer Programme. The framework will be submitted to members for them to make an input and get to understand what it will entail.
Furthermore, let me indicate that, as we speak, we have a system where Gauteng has been identified as the initial province where we could introduce the rooftop solar platforms, and we are looking into this. However, I believe that it is not something that we will be introducing in the next two years. Thank you very much.
Chairperson, the Minister and the department went to the 17th Conference of Parties, Cop 17, and they made a big noise about their renewable energy programme. Nothing came out of it! A year later the Minister comes to this House and tells us, "Bid 1 is delayed. We have delayed Bid 2. We have delayed Bid 3!" There is no apology.
Why did the Minister not get her ducks in a row with Eskom and Treasury before she went to Cop 17? That is the first question. The second one is this. Is she considering reimbursing the bidders for Bid 1, 2 and 3, who have spent huge sums of money in preparing for these bids and sorting out compliance with documents that are not a book high, but a tower high? Thank you.
Hon member, I will allow it, but you are not supposed to ask two questions in one! However, I will allow it.
House Chair, I do not remember the department or me making a big noise about the renewable energy programme at any time. We went to Cop 17 and we announced the 28 preferred bidders under Window 1, and they qualified. We gave them a timeline for financial close, which was June 2012. We have been communicating with these preferred bidders and they know the situation. If the hon member was unfortunately a preferred bidder, he should maybe just indicate that.
The preferred bidders with whom we will be signing on the 5th know the exact process that we had to follow. Equally, many of them had particular challenges with regard to their own financial close. We have been communicating with all of them, they have all been satisfied, and we have not heard any of the bidders complaining. I just want to say to you that when we sign on Tuesday we will know how many out of the 28 did not qualify.
We have not actually delayed Window 2. We announced Window 2 on time. However, we knew that certain of the bidders would not be able to get financial close by the 5th, and that we would then have to take the megawatts and transfer them to the 3rd window. So, it would have been wrong of us to just keep on galloping with the processes while we knew that there would be megawatts from Window 1 that we would have to transfer.
We want to keep the lights on in South Africa. That is why we are very much alive to the fact that, if you say you will sign up 1 400 units and you end up signing up only 1 000 units, it means you have 400 units outstanding. What do you do with that?
Regarding Window 3, it was actually the bidders and government departments such as Water and Environmental Affairs, the National Treasury, and Public Enterprises, who said that we should work together for the benefit of the investors, South Africa, and our utility company, so as to make it possible for us to hardwire the processes. This would be to avoid a situation where, when the licence has been issued by the National Energy Regulator of South Africa, Nersa, you have to go to another office. We heard what the President said in the Presidential Infrastructure Co-ordinating Commission, with regard to making it easier to conduct business in South Africa.
Energy is equally central. Energy is an enabler and facilitator. We need to make sure that, whatever happens, and whatever we do, we do not create unnecessary delays. Today, I just want to say to you that the delay of Window 3 is in the best interests of the lights being on in South Africa. [Interjections.] Thank you very much. [Time expired.] [Applause.]
Order! That is why we do not allow two questions in one, because we have to give the Minister more time for that.
Chair, I thank the hon Minister. I am not sure if we have the best renewable energy programme in the world, but we have certainly made some progress, and I do commend you for that. On this particular issue we have certainly cut it fine in respect of finalising all the outstanding details related to the renewable energy programme. In fact, if we had finalised these contracts only a few days later, the validity of these contracts that the independent power producers had concluded would, in fact, have become null and void.
This programme has certainly travelled a rocky road and investors' confidence has often been shaken. In this regard, I noticed the announcement on Monday by your department that a further 3 200 megawatts of renewable energy contained in the Integrated Resources Plan, IRP, will in fact be brought forward in terms of the timelines.
When will the ministerial directive in this regard be issued, and could you give us more details on it with regard to the timelines and the quanta that will be given to different technologies. I thank you.
House Chair, the hon member has indicated that he heard what I said on Monday, and I did indicate that in the next two weeks we would be making the necessary determination. So, those details will be known. Thank you very much.
See also QUESTIONS AND REPLIES.