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Integrated Resource Plan
May 2010
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What is it?
• “Integrated Resource Plan means a resource plan established by the national sphere of government to give effect to national policy” (legal definition in the Electricity Regulation Act No.4 of 2006)”
• “It is a planning process that seeks to identify the future energy demand and the energy mix that will meet that demand
• It takes into account all the aspects of the electricity value chain, generation, transmission and distribution”
IRP Stakeholder Engagement Process
• The DoE’s mandate is to undertake a long-term planning function to develop an integrated resource plan (IRP) to meet South Africa’s electricity requirements.
• The IRP 1 Gazetted in December 2009 paved the way for the development of IRP 2 through a consultative process.
• The Stakeholder Engagement Process will began in mid-March 2010 and continued through to early June 2010 (Public Participation process will kick-off).
• The purpose of the process is to:– Ensure effective exchange of information between critical stakeholders.– Focus the discussion of the planning issues. – Receive the benefit of early stakeholder comments that could be
incorporated into the Plan.– Build a common understanding of the task, its challenges, the
Department’s analytical approach and the design of the Plan.
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Load forecastAnnual RSA energy sent-out forecast
200,000
250,000
300,000
350,000
400,000
450,000
500,000
550,000
600,000
En
erg
y se
nt-
ou
t (G
Wh
)
High Mod Revised Low
This is a forecast for national sent-out (including imports) –
2.4%
3.6%
4%
3.6%
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ScenariosScn Name Conditions
1 Reference planLeast-cost; direct costs only; limited project options
2a Domestic emission (Emission Constraint 1)
• Hard constraint of 275Mt/a in all years• Options should include Wind to 3200MW; CSP to 10000MW;
Nuclear up to 33000MW; Discount rate
2b Regional emission (Emission Constraint 2)
• Hard constraint of 275Mt/a domestic and 40Mt/a imported in all years
• Options as per 2a
2c Delayed regional emission (Emission Constraint 3)
• No constraint before 2025, apply constraint of 275Mt/a domestic and 40Mt/a imported after 2025.
• Allow some advanced decommissioning or ramping down of existing coal options to reduce to hard target in 2025
• Other options as per 2a
2d Carbon Tax Alter input costs to include carbon tax as per the Long Term Mitigation Strategy
3a IPP alternates 1 Force in Mmamabula, Moamba, MSBLP
3b IPP alternates 2 Force in Mpanda Nkua, MTPPP2 (over and above IPP alternates 1)
Stakeholder Engagement Objectives• The Process hopes to achieve the following objectives:
– Stakeholders have the opportunity to participate to the degree that they want to, and on the areas which they had the most interest.
– Stakeholders are able to comment on topics they deemed important that might be outside the scope of the IRP planning process, for example the national energy plan.
– The workshops will enable DoE to share their planning challenges, approach, and considerations on the various Plan elements first-hand.
• Stakeholders have the opportunity to share their perspectives with the DoE and other stakeholders.
– Stakeholders are able to learn about the complexity of the IRP process as the various elements of the Plan are developed.
– Respect for stakeholders and acknowledgment of the range of stakeholder interests and priorities.
Getting Stakeholder Alignment• Several critical elements on which Stakeholder Alignment is crucial:
– Importance, role and scope of the IRP– Need to balance Security of Supply, Affordability and Emissions– Complexity of the Challenge (e.g., engaging stakeholders, technical and policy
constraints, projecting future supply, demand and supply technology issues) – Need for quality data, assumptions and analyses that inform decisions. Need
for flexibility, adaptability and contingency planning.– Need for flexibility, adaptability and contingency planning.
• Several Stakeholders have already shown that the following aspects will require some debate:– The role and feasibility of Carbon Commitments and Renewables – The role and feasibility of a Coal Phase-Out – The role of Nuclear Power
Stakeholder Buy-in of the Engagement Process
• It is critical to ensure Stakeholder buy-in to the engagement process since faith in the process will result in trust in the output
• Greater engagement at the initial stages will result in less intense interactions as the plan is developed (ie more and more agreement as the plan nears completion)
• The process success depends on:– Being transparent going forward and inclusive.– The Department taking leadership and continuing dialogue with stakeholders.
regarding issues of supply options, protection for the poor, Affordability, Distribution issues, demand scenarios, and Carbon Commitments.
– Encourage more involvement from residential, commercial, and manufacturing customers.
– Facilitate participation by organisations that may have limited time or resources.– Continue stakeholder dialogue in order to gain “consensus” and to “educate” the
public about the vision for sustainable electricity in South Africa.
WHO
STAGE
WHEN
HOW
WHY
Planning ParametersUpdated
SO IRP
DoE IRP
Government IRP
RSA IRP
Stage Steps
Planning parametersreviewed, Assessed &Agreed
Modelling,Assessments &Scenarios Run
Conclusions Plan Complete
Electricity Country Planning Process (IRP)
SO DoE ID TT PublicDoENERSA
RegulatedExpertCold EyeReview
MinisterialAlignment &Conflict Resolution
Regulated Regulated
??2009
Oct2009
Apr2010
Jun2010
Sept2010
Internal Concept Plan by Eskom SO
DoE IRP TT ID TTRequest forComment
Gazetted
Technical Governance
GovernanceTechnical
WHO
STAGE
WHEN
HOW
WHY
Input Parameters& Constraints
Models and Conclusions
DraftIRP
Government IRP
RSA IRP
Stage Steps
Planning parametersreviewed, Assessed &Agreed
Modelling,Assessments &Scenarios Run
Conclusions Plan Complete
IRP Stakeholder Engagement Process
Identified Stakeholders
Identified Stakeholders
ID TT PublicIdentified Stakeholders
Regulated ExternalPerspectives
MinisterialAlignment &Conflict Resolution
Regulated Regulated
March2010
April2010
May2010
Jun2010
Sept2010
Written Input and Facilitated Sessions
Written Input &Q&A Sessions
ID TT Request forComment
Gazetted
The critical consultation sheetsParameter Owner Key Outcome
Discount rate NT Price coneDemand Forecast DOE Security of supplyEnergy Intensity (Long) DTI Security of supplyEnergy Intensity (Short) DOE Security of supplyEconomic multipliers NPlanning Key OutcomeRate of Exchange NT Price coneInflation NT Price coneGDP NT Price coneCost of energy not served DOE Security of supplyPrice Elasticity NT Price coneDSM DOE Security of supplyEE DOE Security of supplyDMP SO Security of supplyConservation DOE/NERSA Security of supplyGx Mix Parameter DOE Price coneCogeneration DOE Price coneNuclear DOE CarbonFunding / Financing NT Price cone
Parameter Owner Key OutcomeGx Lifecycle Costs DOE Price coneReserve Margin DOE Security of supplyOwn Generation DOE Price coneImports SAPP Security of supplyPrice cone DOE Key Outcome Renewables DOE CarbonWater DWAF ExternalityIRP 2010 Approach & Methodology Overview DOE GovernanceIRP Consultation Plan DOE GovernanceCarbon & Climate Change DEAT CarbonCarbon taxes DEAT CarbonDistribution DOE ExternalityBase Scenarios DOE/NERSA Key OutcomeGx Location DOE Externality
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The critical consultation sheets
Identified Stakeholders
Key IRP 2010 milestones updated 17 May 2010
1. IRP 2010 input consultation sheets available on the WEB for public input (DOE)
2. IMC progress review of consultation process
3. Closing date for 1st round of public input (DOE)
4. 1st Public hearings on IRP 2010 input sheets (DG DOE)
5. Complete modelling of scenarios and 1st draft IRP 2010 (ISO Planning)
6. IMC approve 1st draft IRP 2010 for public hearing (DG DOE)
7. 2nd Public hearing on 1st draft IRP(DOE)
8. IMC approve daft IRP 2010 for cabinet to review (IMC)
9. Cabinet approve IRP 2010 to gazette for public participation (IMC)
10. IRP 2010 gazetted for public participation (Minister DOE)
11. Public participation process closes
12. IMC approve Final IRP 2010 to be promulgated (IMC)
13. Cabinet approve Final IRP 2010 for promulgation (IMC)
14. Promulgate IRP 2010
SeptJuly AugMay June
30
11
15
7
26
7
23
17
13
24
Consultation on IRP key planning input parameters process
Public Participation in IRP to Promulgation Process
To be confirmedTo be confirmed
Conclusion
• The building of new power stations is critical to ensure we keep the lights on
• Stakeholder engagement is critical to ensure South Africans have their say in our energy mix for the future
• We have a website www.doe-irp.co.za which will be a portal for engagement