South Africa Energy Market Report – February 2018
Following Eskom’s financial status and loan applications, the National Planning Commission (NPC) has reinforced the National Development Plan (NDP’s) discussion document on the energy sector. The operations, planning, power procurement, purchasing and contract functions within Eskom are to be separated into an independent institution. The document was published for public consultation on the energy sector reformation and is not meant to be prescriptive, or to overhaul the NDP. Instead, it raises points for discussion and proposals, which is aligned to the NPC role by promoting, advancing and monitoring the implementation of the plan. Whether and how the issues raised are recorded and the way forward will depend on the outcome from the public-engagement process. Electricity sector practitioners and organised businesses are raising serious questions about the suitability and sustainability of the Utility’s vertically integrated, near monopoly, structure, which is all encompassing – incorporating the Country’s generation, transmission, system planning and distribution.
The strengthening of the Rand; which countered the rising global cost of Brent crude oil in February 2018, pricing decreased as follows:
Unleaded 93: -R 0.30
Unleaded 95: -R 0.30
Illuminating paraffin: -R 0.19
Diesel: R 0.17
While very little appears to be happening to this end, The National Treasury of South Africa has urged the public to proactively determine their carbon footprint whilst implementing measures to reduce their carbon emissions before the second draft Carbon Tax Bill is released for comment. The price of energy will rise and by introducing additional costs to budget conscious companies need to implement measures to mitigate the eventual impact of a carbon tax. By implementing measures to reduce carbon emissions companies could potentially halve their carbon footprint, which is return would reduce their carbon tax bill obligations significantly, once implemented.
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