PUBLIC ENTERPRISES PROGRAMME 2: Energy and Broadband Enterprises 2008/9 BUSINESS PLAN 27-29 FEBRUARY...

PUBLIC ENTERPRISES

PROGRAMME 2: Energy and Broadband

Enterprises

2008/9 BUSINESS PLAN

27-29 FEBRUARY 2008

2Strictly confidential

PROGRAMME 2ENERGY & BROADBAND ENTERPRISES

Purpose To align the corporate strategies of Eskom, PBMR and Broadband Infraco with

government’s strategic intent and monitor their performance in respect of financial and operational performance

Priorities for 2008/09 Portfolio Management

Implementation of the National Electricity Emergency Response Plan

Fastrack Geyser Replacement Programme

Capacity Expansion Programme implementation (Generation & Transmission)

Generation Adequacy monitoring

Implementation of Single Buyer Model – monitor Co-gen and IPP implementation

Generation, Transmission & Distribution Infrastructure Maintenance & Refurbishment

Monitoring of Eskom Nuclear Build Programme

Monitoring of progress of International Submarine Cable rollout


PROGRAMME 2

BUDGET: ENERGY & BROADBAND ENTERPRISES

Over the MTEF period, a total of R727 million has been allocated for Broadband Infraco and R3.5 billion for the PBMR. The Transfers are broken down as follows:

ITEMS

BUDGET 07/08

(R Thousands)

BUDGET 08/09

(R Thousands)

BUDGET 09/10

(R Thousands)

BUDGET 10/11

(R Thousands)

COMPENSATION OF EMPLOYEES 6 474 6 915 7 444 7 992

GOODS AND SERVICES 3 133 3 665 5 792 5 261

TRANSFERS (PBMR and Broadband Infraco) 2 502 273 2 127 000 1 960 000 140 000

OTHER - - - -

CAPITAL - - - -

TOTAL 2 511 880 2 137 580 1 973 236 153 253

140 000210 000377 000-Broadband Infraco

2 127 000

1 750 000

BUDGET 08/09

(R Thousands)

1 960 000

1 750 000

BUDGET 09/10

(R Thousands)

140 000

-

BUDGET 10/11

(R Thousands

BUDGET 07/08

(Adjusted

Appropriation)

2 502 273TOTAL

2 502 273Pebble Bed Modular Reactor

140 000210 000377 000-Broadband Infraco

2 127 000

1 750 000

BUDGET 08/09

(R Thousands)

1 960 000

1 750 000

BUDGET 09/10

(R Thousands)

140 000

-

BUDGET 10/11

(R Thousands

BUDGET 07/08

(Adjusted

Appropriation)

2 502 273TOTAL

2 502 273Pebble Bed Modular Reactor


PROGRAMME 2Budget: ENERGY & BROADBAND ENTERPRISES continued

ITEMS BUDGET 07/08

(Rands)

BUDGET 08/09

(Rands)

COMPENSATION OF EMPLOYEES 6 474 000 6 915 000

GOODS AND SERVICES 3 133 000 3 665 000

TRANSFERS 2 502 273 000 2 127 000 000

OTHER - -

CAPITAL - -

TOTAL 2 511 880 000 2 137 580 000

The Goods and Services for 2008/9 includes R 3 250 000 for Consulting Fees.


PROGRAMME 2: Energy and BroadbandStructure

VACANCIES : 1. DDG

2. DD – Financial Analyst

3. DD - Energy

Deputy Director-GeneralBroadband & Energy

Filled Posts: 11

Vacant: 3

Total=14

Admin. Assistant

Executive Assistant/Office Manager

Admin. Assistant

Deputy Director: Financial Analysis

Chief Director:Energy

Chief Director:Infraco

Director:Nuclear

Deputy Director: Energy

Director:Financial Analysis

Director:Infraco

Admin. Assistant

BROADBANDENERGY

Admin. Assistant

Deputy Director: Energy

+ 3 Interns (2008/9)


PROGRAMME 2 : ENERGY AND BROADBAND ENTERPRISES

Sub-Programme/Project :

ESKOM

Sub-Programme

Activity / Project Critical Path Activities Time Required to

complete Activity

Due Date for submission

to DG

Output

INVESTMENT MANAGEMENT

Corporate Plan Submission by Eskom of its 5 year business plan by 7 April 2008

4 weeks 30/06/2008 Briefing Memorandum: A critical assessment of the business plan

Eskom Shareholder Compact SOE team to drive the process of putting an annual updated compact into place:Review the strategic intent statementReview and benchmarking of SKPI’sApproval of SKPI’s for the Shareholder CompactEnsure signoff from GovernanceSigned Shareholder Compact

2 weeks 15/07/2008 Decision Memorandum: Agreed Shareholder Compact

SOE Dashboard: Monitoring of Eskom Performance

Quarterly update of Eskom Dashboard Database 8 days Within 1 day of receipt of Quarterly Report

Updated Eskom Dashboard (latest information)

Quarterly Report (Q1) Submission by Eskom of its 2008Q1 Report by 15/08/2008

1 week 15/09/2008 Briefing Memorandum: Critical assessment of performance including major risks





Annual Report Notify Eskom in writing (Mohamed Adam) that a draft of the annual report is expected by end-June in anticipation it being lodged with parliamentReceipt of Draft Annual Report from Eskom by 30/06/2008Submission by Eskom of its 2007/8 Annual Report by 31/07/2008

2 weeks The last Friday a week before Eskom Annual Report is lodged with Parliament

Briefing Memorandum: Analysis of Eskom Performance, Major Issues, Risk, Financial, Regulatory and Governance


Sub-Programme Activity / Project Critical Path Activities Time Required to complete Activity


to DG

Output


Five year performance review

Perform Eskom 5 year performance review (based on previous publication)

Analysis of Eskom’s five year performance

1 month 20/12/2008 Briefing Memorandum: The 5 year performance of Eskom

DPE Board Presentations

Monthly Presentations on SOE Performance 12 days n/a PowerPoint Presentation to theMonthly DPE Board Meeting

Review of Board Strength

SOE team to annually assess composition of the SOE Board

1 week To co-inside with Annual Report Assessment

Briefing Memorandum to the Minister

Investor Brief Energy team to compile a one page analyst report for the Eskom Board, specifically to include areas of focus. To be prepared quarterly.

4 weeks 15/05/2008 Briefing Memorandum to theMinister and a covering letter tothe Eskom Board with the onepager attached.15/09/2008

15/12/2008

15/03/2009

PROGRAMME 2 (ESKOM)


PROGRAMME 2 (ESKOM)

Sub-Programme


complete Activity

Due Date for submission to DG

Output

INDUSTRY IMPACT

Capacity Expansion Programme(Implementation)

Development of a Monthly Reporting Template using SOE Dashboard (by 01/04/2008)Submission of Progress Reports Monthly by Eskom (first working day)

24 days MonthlyStart 01/05/2008 with April 2008 report

Monthly Briefing Memorandum: Progress with the Capacity Expansion Programme

Generation Adequacy •Monitor continued implementation of the Adequacy Report by Eskom•Monitor Generation Adequacy within Eskom, Reserve Margin, Available Capacity vs. Demand, etc.

8 weeks 15/04/2008 Briefing Memorandum: Quarterly assessment of Eskom Generation Adequacy15/07/2008

15/10/2008

15/01/2009

Tariff Review (MYPD) Engage with NERSA on Asset Valuation and Rate of Return MethodologyDefine level and nature of required government contributionFinal Multi-year pricing determination by NERSA

9 weeks 01/04/2008 Status Report

Briefing Memorandum: Update on progress with NERSA engagement

Briefing Memorandum: Outcome of NERSA Multi-year Price DraftDetermination and implications for Eskom funding

Briefing Memorandum: Final outcome of NERSA Multi-year Price Determination and implications for Eskom funding

30/06/2008 Assessment of Draft Determination

31/01/2009 (Final Assessment)

Geyser Replacement Programme Develop project frameworkObtain funding from NT and EskomImplement (2 000 000 geysers in 2 years)

32 weeks Monthly (last working day)

Briefing Memorandum: Monthly Progress reports to ensure speedy rollout




Output

Capitalisation of Eskom

Develop a Proposal for the Capitalisation of Eskom to fund the Build Programme

Develop a Terms of Reference Appoint a consultant to perform the analysis

3 months 30/06/2008 Decision Memorandum: Proposals for the Capitalisation of Eskom, assessmentof the implications of the various optionsand a recommendation of the preferredmethodology

Implementation of the Single Buyer Model

Engage with DME to include a coal-fired base load IPP in the country plan

Engage with Eskom to issue Request for Proposals for base load IPP

Monitor progress with tendering and contract award

12 weeks 30/06/2008 Briefing Memorandum: Progress with theimplementation of the Single Buyer andbase load IPP by Eskom

Assessment of the

Audit of Eskom

Maintenance Practices

(Generation)

Compile a letter from the Minister requesting the Eskom Board to conduct an audit using an independent internationally recognised resource.

Eskom board to contract an Expert to conduct an audit of Eskom Generation’s practices and the high rate of unplanned outages

8 weeks 31/07/2008 Briefing Memorandum: An assessment of the audit report on Eskom’s maintenance practices and recommendation of possible interventions

Assessment of the

Audit of Eskom

Maintenance Practices

(Transmission)

Compile a letter from the Minister requesting the Eskom Board to conduct an audit using an independent internationally recognised resource.

Eskom board to contract an Expert to conduct an audit of Eskom Transmission’s practices

8 weeks 31/07/2008 Briefing Memorandum: An assessment of the audit report on Eskom’s maintenance practices and recommendation of possible interventions

PROGRAMME 2 (ESKOM)


Sub-Programme

Activity / Project Critical Path Activities Time Requiredto completeActivity


Output

Implementation of the National Response Plan

Lead the Implementation of the National Response plan to the Electricity Shortage

Monitor the Implementation of the National Response plan to the Electricity Shortage

Drive and contribute financially to the National Energy Efficiency Awareness Campaign

6 weeks 31/05/2008 Briefing Memorandum: An outline of the progress made with the implementation ofthe plan

Distribution Infrastructure Maintenance andRefurbishment

Develop a proposal for Eskom and the Large Metros to perform distribution infrastructure maintenance, refurbishment and expansion

Develop a Terms of Reference Appoint an international expert to assist

with the drafting of the proposal Obtain Cabinet approval for

implementation framework

8 weeks 30/06/2008 Decision Memorandum: Approved framework for Eskom and Metros to takeover the Electricity Distributioninfrastructure of neighbouring smallmunicipalities

PROGRAMME 2 (ESKOM)


Sub-Programme

Activity / Project Critical Path Activities Time Requiredto completeActivity


Output

Eskom Nuclear Build Programme

Monitor Progress with Eskom Nuclear Build, Quarterly Reporting.

Liaison between DPE, DME and NNR on Eskom Nuclear Build Programme

4 weeks Within 1 month of end of Quarter

Quarterly Briefing Memoranda

Forum of Executives inEnergy

Secretariat function for the Technical Task Team that supports the FEE

Support to the FEE Secretariat

Ongoing n/a Various

Ad hoc Referrals from the DG Referrals from the Minister General Comment on Cabinet

Memoranda PFMA Applications Parliamentary Questions Publication of 1 article per annum Technical responses to Media Queries

Ongoing Agreed Dates Timeous response to agreed dates and Decision or Briefing Memoranda as required

PROGRAMME 2 (ESKOM)


Sub-Programme/

Project BROADBAND INFRACO

Sub-

Programme Activity / Project Critical Path Activities Time Required

to complete

Activity

Due Date for

submission to DG Output


Corporate Plan Receipt of Corporate Plan from Infraco by 29/02/2008 (est. 01/04/2008)

Analysis of Corporate Plan

4 weeks 30/04/2008 Briefing Memorandum: Critical assessment of the Corporate Plan

SOE Dashboard: Monitoring of InfracoPerformance

Monthly update of Infraco Dashboard Database 3 weeks Monthly(Start 01/05/2008)

Updated Infraco Dashboard (latest information)

Shareholder Compact SOE team to drive the process of putting an annual updated compact into place:

Review the strategic intent statement Review and benchmarking of SKPI’s Approval of SKPI’s for the Shareholder

Compact Ensure signoff from Governance Signed Shareholder Compact


Monthly Report Develop a framework for monthly reporting Analyse financials, operations Risks and Corporate Governance Timely submission of Monthly report

1 week Monthly(01/06/2008)

Monthly Briefing

PROGRAMME 2


Sub-

Programme Activity / Project Critical Path Activities Time Required to

complete Activity Due Date for submission to

DG Output

Quarterly Report (Q1) Submission by Infraco of its 2008Q1 Report by 15/08/2008






PROGRAMME 2 (INFRACO)


Sub-Programme

Activity / Project Critical Path Activities Time Required to complete Activity

Due Date for submission to

DG

Output


Annual Report Notify Infraco in writing that a draft of the annual report is expected by end-June in anticipation it being lodged with parliament

Receipt of Draft Annual Report from Infraco by 30/06/2008

Submission by Infraco of its 2007/8 Annual Report by 31/07/2008

2 weeks The last Friday a week before Infraco Annual Report is lodged with Parliament

Briefing Memorandum: Analysis of Infraco Performance, Major Issues, Risk, Financial, Regulatory and Governance

DPE Board Presentations Monthly Presentations on SOE Performance

12 days n/a Powerpoint Presentation to the Monthly DPE Board Meeting

Review of Board Strength SOE team to annually assess composition of the SOE Board

1 week To Co-incide with Annual Report Assessment


Investor Brief Infraco team to compile a one-page analyst report for the Infraco Board, specifically to include areas of focus. To be prepared quarterly.

4 weeks 15/05/2008 Briefing Memorandum to the Minister and a covering letter to the Infraco Board with the one pager attached.



Sub-Programme

Activity / Project Critical Path Activities Time Required to complete

Activity


Output

INDUSTRY IMPACT

Review of Infraco’s Impact Compile Benchmark: Price, Service level, Capacity, etcAssessment of Broadband Pricing in SA, out of SA, key destinations (BMI)Analyze Results on South African Broadband pricing quarterlyDevelopment of a Terms of ReferenceAppointment of a consultant

4 weeks 30/04/2008 Briefing Memorandum: InfraCo’s Impact on Prices and Broadband Penetration

31/07/2008

31/10/2008

31/01/2009

International Submarine Cable and rolling out of the rest of the terrestrial network

Monitoring and Facilitating the Implementation of the International Submarine Cable

12 weeks 15/04/2008 Briefing Memorandum: Progress with the rolling out of the International Submarine Cable15/07/2008

15/10/2008

15/01/2009

Capitalisation Preparation of the Infraco MTEF Submission

4 weeks 01/08/2008 Briefing Memorandum: Guarantee Issue, Loan or Cash Injection and supporting documents

Ad hoc Referrals from the DGReferrals from the MinisterGeneral Comment on Cabinet MemorandaPFMA ApplicationsParliamentary QuestionsPublication of 1 article per annumTechnical responses to Media Queries




PROGRAMME 2 : ENERGY AND BROADBAND ENTERPRISES

Sub-Programme/Project :

PBMR



to DG

Output


Corporate Plan Submission by PBMR of its business plan by 28/02/2009

4 weeks 30/06/2009 Briefing Memorandum: A critical assessment of the business plan

PBMR Shareholder Compact

SOE team to drive the process of putting an annual updated compact into place:Review the strategic intent statementReview and benchmarking of SKPI’sApproval of SKPI’s for the Shareholder CompactEnsure signoff from GovernanceSigned Shareholder Compact


Monthly Reports Development of an approved monthly reporting frameworkEMC meetings and NT approval

2 days Monthly (month-end)

Monthly Briefing Memoranda

SOE Dashboard: Monitoring of PBMR Performance

Quarterly update of PBMR Dashboard Database

8 days Within 1 day of receipt of Quarterly Report

Updated PBMR Dashboard (latest information)

Quarterly Report (Q1) Submission by PBMR of its 2008Q1 Report by 15/08/2008



Sub-Programme


complete Activity


DG

Output





Annual Report Notify PBMR in writing that a draft of the annual report is expected by end-June in anticipation it being lodged with parliamentReceipt of Draft Annual Report from PBMR by 30/06/2008Submission by PBMR of its 2007/8 Annual Report by 31/07/2008

2 weeks The last Friday a week before PBMR Annual Report is lodged with Parliament

Briefing Memorandum: Analysis of PBMR Performance, Major Issues, Risk, Financial, Regulatory and Governance

PROGRAMME 2 (PBMR)


Sub-Programme

Activity / Project Critical Path Activities Time Required to complete Activity


Output


Expenditure Monitoring Committee

Inter-governmental committee meetingsMonthly MeetingsNT approvalMonthly transfers to PBMR

24 days Monthly(last working day of the month)

Briefing Memorandum: Outlining Progress, any outstanding issues and request for transfer payment

South Africa Power Project

Participation/Representation 52 days n/a Successful Implementation of the SA Power Project

DPE Board Presentations Monthly Presentations on SOE Performance

12 days n/a PowerPoint Presentation to the Monthly DPE Board Meeting

Review of Board Strength SOE team to annually assess composition of the SOE Board

1 week To Co-incide with Annual Report Assessment


Investor Brief PBMR team to compile a one-page analyst report for the PBMR Board, specifically to include areas of focus. To be prepared quarterly.

4 weeks 15/05/2008 Briefing Memorandum to the Minister and a covering letter to the PBMR Board with the one pager attached.15/09/2008

15/12/2008

15/03/2009

PROGRAMME 2 (PBMR)


Sub-Programme Activity / Project Critical Path Activities Time Required to

complete Activity


to DG

Output

INDUSTRY IMPACT

Government’s role in developing a nuclear power sector

Incl. Premature Decommissioning Fund Proposal

Incl. Nuclear Indemnity Insurance

Incl. Waste Disposal Plan Develop a Terms of Reference Commission a consultant

6 months 30/09/2008 Decision Memorandum: Proposals and recommendations on how to deal with these matters

Comparison of Levellised Unit Electricity Costs for differentgeneration technologies

Develop a Terms of Reference Commission a consultant

6 months 30/09/2008 Briefing Memorandum: Proposals and recommendations

National Treasury Investigation Monitor Progress 12 days 30/04/2008 Briefing Memorandum: Final Report Assessment

NERSA approved purchase price for PBMR units

Engagement with NERSA and Eskom and PBMR to reach an agreed price for PBMR units

Negotiation with NERSA to allow work in progress costs to Eskom for prepayment

Agreement between PBMR and Eskom on prepayment schedule

Valid construction contract/order for PBMR to start construction

36 days 30/11/2008 Briefing Memorandum: Progress Report to the Minister

PROGRAMME 2 (PBMR)


Sub-Programme


complete Activity


DG

Output

New/Updated PIM Submission of updated document by PBMR

12 days 31/10/2008 Briefing Memorandum: Assessment of PIM

Capitalisation Preparation of the PBMR MTEF Submission

4 weeks 01/08/2008 Briefing Memorandum: Guarantee Issue, Loan or Cash Injection and supporting documents

Ad hoc Referrals from the DGReferrals from the MinisterGeneral Comment on Cabinet MemorandaPFMA ApplicationsParliamentary QuestionsPublication of 1 article per annumTechnical responses to Media Queries


PROGRAMME 2 (PBMR)

THANK YOU

PUBLIC ENTERPRISES PROGRAMME 2: Energy and Broadband Enterprises 2008/9 BUSINESS PLAN 27-29 FEBRUARY...

Documents

Transcript of PUBLIC ENTERPRISES PROGRAMME 2: Energy and Broadband Enterprises 2008/9 BUSINESS PLAN 27-29 FEBRUARY...