(AsgiSA) Annual Report 2008 - South African Government Information
(AsgiSA) Annual Report 2008 - South African Government Information
(AsgiSA) Annual Report 2008 - South African Government Information
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Accelerated and Shared Growth Initiative for <strong>South</strong> Africa<br />
ANNUAL REPORT<br />
<strong>2008</strong><br />
5.2.8 Electricity infrastructure (distribution)<br />
Recent reviews and audits of electricity distribution infrastructure (EDI) reveal a historic pattern of<br />
neglect by distribution licence holders in maintaining old infrastructure and in planning for expanded<br />
distribution services to cater for the rapidly urbanising population. A number of <strong>2008</strong> blackouts were<br />
caused as much by distribution failure as by generation capacity shortages. <strong>Government</strong> policy commitment<br />
to consolidate the fragmented distribution industry aims to merge the distribution assets of<br />
Eskom and individual municipalities into six wall-to-wall self-financing regional distributors of critical<br />
scale and capacity. The merger process is based on a number of principles aimed at ensuring that none<br />
of the transacting parties lose value. Central to the process is the need to first ring-fence and record all<br />
distribution assets. In many cases, existing asset registers are inadequate. The voluntary nature of EDI<br />
restructuring has proved ineffective – the backlogs in distribution infrastructure continue to grow, while<br />
maintenance budgets continue to be squeezed, to the detriment of decent service to consumers. It is<br />
therefore expected that a constitutional amendment will be moved in 2009/10 to make participation<br />
in the EDI restructuring mandatory.<br />
5.2.9 Expansion of transport infrastructure<br />
Despite the global downturn, Transnet has committed to maintain its planned five-year <strong>2008</strong>/09 to<br />
2012/13 capital projects totalling R81 billion 11 . As with Eskom, future challenges will be to sustainably<br />
finance such projects while ensuring they are completed on time and on budget. In addition, Transnet’s<br />
efforts to shift significant quantities of freight from road to rail is an important target, which will favourably<br />
impact on road infrastructure requirements.<br />
Priority needs to be given to improving the relatively low benchmarked efficiencies of rail and port<br />
infrastructure, an important key performance indicator that the Department of Public Enterprises monitors.<br />
Ensuring the timeous completion of the National Multi-Products Pipeline (NMPP) will be important.<br />
The existing pipeline’s limited capacity is already resulting in a significant proportion of inland fuel<br />
being hauled by road, contributing to congestion.<br />
During <strong>2008</strong>, an interdepartmental initiative was launched to address deterioration of Mpumalanga’s<br />
roads, caused by Eskom’s coal-supply and export coal-haulage trucks. This resulted in a R620-million<br />
rehabilitation programme over the next three years, funded through the Infrastructure Grant to<br />
provinces. The programme will also cover the development of the R33 road network to Medupi Power<br />
Station in Limpopo to support plant and construction machinery movement.<br />
Investment in modern urban transport systems continues, highlighted by the R25,6-billion Gautrain link<br />
between Johannesburg’s OR Tambo International Airport and Tshwane (completion end 2010); the Gauteng<br />
Freeway Improvement Project; the national Taxi Recapitalisation Programme; a number of major<br />
metropolitan bus rapid transit networks; and the completion of the project to consolidate passenger rail<br />
service institutions into the <strong>South</strong> <strong>African</strong> Rail Commuter Corporation (completion <strong>2008</strong>/09).<br />
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