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Mantashe Shines Light on Interventions to Boost Electricity Supply

March 8, 2021

Department of Mineral Resources and Energy

Government is working on a number of interventions to close the current electricity supply and demand deficit.

The mineral resources and energy minister, Gwede Mantashe, emphasized this in an address to the 2021 Prospectors and Developers Association Conference.

Interventions include:

• ensuring speedy implementation of renewable energy projects under Bid Window 4 – over a 1000 MW has already come online;
• the procurement of 2000 MW of power under the Risk Mitigation Independent Power Producer Programme – preferred bidders to be announced before the end of March 2021; and
• procurement of additional power in line with the IRP 2019 – request for proposal for 2600 MW of renewable energy (Bid Window 5) to be issued to the market during March 2021 – to be followed by additional Bid Windows between August 2021 and March 2022 from renewable energy, storage, gas and coal.

The minister also pointed out that a chrome interventions paper was tabled in cabinet for approval in October last year.

The paper proposes a set of interventions to support the revival of smelters in the country.

The minister clarified that the “interventions include updating of both the short and long term negotiated electricity pricing frameworks, a short-term export tax on raw chrome ore, improvements on smelting technology and investment into research and development”.

According to the minister, the negotiated short and long-term electricity pricing frameworks have been updated and finalised while the work on the other interventions is ongoing in consultation with national treasury and other stakeholders.

In terms of mining exploration, a new competitive exploration strategy has been drafted and will be finalised and taken through approval processes by June this year.

“This strategy will be the country’s exploration blueprint to attract investments and drive an increase in the contribution of mining to GDP,” he said.

Government aims to “target no less than three percent of global mining exploration expenditure”.

Mining exploration spending in South Africa has been declining over the past twenty years with the country’s share of global budgeted exploration spend dropping by 20% from around $97.4 million (R1.4 billion) in 2019 to $77.4 million (R1.1 billion) in 2020.

The mineral resources and energy department has also committed to reduce licensing timeframes by 50%.

Meanwhile, in Government Gazette 44228, the department published Geoscience Act Draft Regulations for comment.

The Draft Regulations focus on submission of geoscience data and information, dissemination of geoscience data and information, National Advisory Authority function in terms of geohazards, acknowledgement of geoscience data lodged with the Council for Geoscience, authorisation and sanctions and appeals against administrative decisions.

Comment is invited within 30 days of the date of publication.