Energy hindrances hinder the progress of Operation Vulindlela

Finance Minister Enoch Godongwana.

  • Eight of Operation Vulindlela’s 26 priorities have been met, according to ministers Enoch Godongwana and Mondli Gungubele.
  • The quarterly report of Operation Vulindlela noted the challenges in emergency supply of 2,000 MW of power and increasing the energy availability factor over 70%.
  • Successes reported in the quarterly report include the spectrum auction and bidding window 6 of the renewable energy independent energy producers procurement program.

Operation Vulindlela made progress on several targets in the first quarter of this year, with several political interventions already in place, according to Finance Minister Enoch Godongwana and Presidency Minister Mondli Gungubele.

But Operation Vulindlela was still facing challenges in two areas, namely the emergency supply of 2,000 MW of power and increasing the country’s energy availability factor to over 70%. This happens when the country saw five nights in a row of cargo loss as Eskom battled limited supplies.

The two ministers briefed the media on the progress of the government’s structural reform plan, Operation Vulindlela, on Friday afternoon. They said Operation Vulindlela had already achieved reform in eight areas, while Vulindlela was making progress in another 11 areas. In addition to energy constraints, five other areas were also experiencing delays, they said.

Operation Vulindlela was announced by President Cyril Ramaphosa last year as a strategy to provide political certainty and accelerate the pace of structural reforms in the energy, telecommunications, water supply, transport and visa regime sectors. it attracts investments, skills and tourism.

Godongwana said the structural reforms contained in the Vulindlela operation, if implemented correctly, would lead to benefits, including certain policies, investor confidence and improved resource allocation efficiency.

“In digital communications, the successful allocation of high demand spectrum has not only raised over Rand 8 billion for fiscus, but recent indications also show that the industry will invest Rand 50 billion in this.

“In transportation, the successful implementation of third-party private investors can free up R58 billion. In electricity, where we are working with the private sector to unlock the remaining challenges to free embedded generation, we can make an investment of R54. billions, “Godongwana said.

Godongwana said of the 26 priority reforms, eight had been completed and another 11 were progressing. Gungubele said the government plans to provide quarterly updates on the progress of the Vulindlela operation.

“One of the most important roles of Operation Vulindlela is to coordinate structural reforms in the government of the various departments. We have made progress since the announcement to speed up reforms, but we know there is still a long way to go,” Gungubele said. .

The chief director of microeconomics of the National Treasury, Nomvuyo Guma, said that one of the successes of the Vulindlela operation in the first quarter of this year was the spectrum auction, which ended despite the litigation of some actors in the process of auction.

READ | Operation Vulindlela: Too early for congratulations, business says

Guma also said that the energy sector has made progress, with the launch of the offer window 6 of the renewable energy independent energy producers procurement program announced in April with 25 bidders nominated to supply nearly 2,600 MW of wind and solar PV. .

He said there were also plans to wrap up the shutdown of the analog TV broadcast signal. He said Transnet had to relocate to sell 16 freight rail slots to private operators in April before the National Rail Policy White Paper was published. last Wednesday to speed up the reform.

“There is a process to establish an economic regulator and, in an ideal world, that would be fine. And that’s what we’re working for. But we can’t wait. Transnet has moved on and made slots available to move on reform. so that once the regulator is in, they can grant access, ”Guma said.

Project management office chief at the Presidency Rudi Dicks said that while both areas of Operation Vulindlela were facing energy-related challenges, the government was discussing how to address the challenges and make the energy regime more conducive to energy. investors.

“Reducing the lead time for generation projects from 107 days to 57 days is a good example. We are in conversation and continue to keep colleagues up to date when it comes to mining license applications, and this is an important area,” he said. Dicks.

Godongwana said Operation Vulindlela has the potential to boost economic growth beyond the current sub-2% level and create more than 1 million jobs compared to a no-reform scenario.

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