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South Africa: energy policy review to be completed by end-2008

South Africa has begun a review of its energy policy, introduced in 1998, on Tuesday, with the view to complete the process before the end of 2008.
Department of Minerals and Energy (DME) director-general Sandile Nogxina said in Johannesburg that the industry had to retrace the steps that it had taken to achieve the current energy objectives, as it had to determine whether they were still relevant some nine years on.

He was speaking at an energy summit where delegates were deliberating over South Africa’s current energy policy.

“The question confronting us today is whether this policy position is still relevant in the face of high and volatile oil prices, the fluidity of the geopolitical environment, the abundance of our coal deposits and the need for us to ensure security of supply,” Nogxina said.

The white paper on energy had been drafted at a time when the crude oil price had decreased to below $10 a barrel, putting the long-term sustainability of synthetic fuel businesses in question, he explained.

The government was also still noncommittal on nuclear energy for power generation, a view that had changed considerably in the last couple of years, when the policy had been drafted.

Nogxina added that South Africa had cheap electricity at the time, and that rolling blackouts and brownouts were limited.

“Eskom had a reserve margin of about 30%, whereas now Eskom barely meets demand, with a reserve margin around 10%. The message is loud and clear: the days of cheap electricity are over,” Nogxina told delegates.

A review of the energy policy would identify gaps, and if need be, set new objectives.

Additional information:
News date: 25/09/2007

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