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Johannesburg - A new draft bill will prescribe minimum supply levels of energy products in case of an energy crisis, which in the case of petrol could add about 20c/l to the cost of fuel.
This is according to Nhlanhla Gumede, the deputy-director general of the department of mineral affairs and energy, in an initial presentation on the legislation to parliament on Wednesday.
The legislation, which he says is primarily about the collection, analysis and exploitation of data to ensure sustainable energy supply in the future, will be presented to the portfolio committee on minerals and energy next month. Stakeholders will then be able to make presentations to the committee.
Gumede says that SA currently has strategic reserves of crude oil. The reserves of refined in SA are only sufficient to last the country about eight or nine days. In an emergency, it would take 21 days to import fuel.
Gumede says that such an eventuality is "highly unlikely" although South Africa did have a taste of what it may be like in December 2006, when there were maintenance problems at a refinery in Cape Town.
The economy cannot afford a shortage of fuel as an estimated 22% of the country's GDP is directly dependent on liquid fuels. The increased "cost of insurance" for storage is therefore justified.
Gumede believes the one-off cost of 20c p/l spread over a year - which the industry indicates would be needed for the storage of reserve fuel - is not very high.
He says demand for fuel in SA jumped by 6% last year to about 20 billion litres per annum. Oil and fuel imports are currently a major contributor to the trade deficit (the shortfall on the current account of the balance of payments is in the region of R7bn).
Both Sasol (synthetic fuel) and PetroSA already have advanced plans for a new fuel refinery, the soonest that this could be up and running would be in 2014.
The requirement for reserves in the new legislation will also apply to other energy resources such as coal.
The committee described the facts provided by Gumede as "shocking".
These include the fact that Eskom currently receives the equivalent of three US cents per kWh of power.
Urban households pay double that amount (6c) and rural consumers even more. In contrast, large industrial clients pay about 2c per kWh.
Gumede says the problem is that it costs Eskom approximately 60c per kWh during peak periods, or during a crisis, to use diesel-powered generators. He says that to solve the problem, Eskom would need at least 5c per kWh.
The committee noted that Gumede appeared to be making an appeal for Eskom's planned 60% hike in tariffs.
- Sake