1 The CEF Group of Companies DISTRIBUTED GENERATION

1 The CEF Group of Companies DISTRIBUTED GENERATION &PRIVATE PPAS DR. PHINDILE MASANGANE

2 Presentation outline § About the CEF Group of Companies § Future of Energy § Evolution of the ESI § Distributed Generation & Private PPAs

3 Current CEF Group Structure Minister of Energy CEF Energy Projects Renewable Subsidiaries ETA Energy (SWH) Main Subsidiaries Equalisation Fund Petro. SA SFF i. Gas AEMFC CCE PASA Associate Companies Methcap (19%) Ener. G Joburg (29%)

4 About the CEF Group q CEF SOC Ltd: § is a schedule 2 public enterprise established under the CEF Act 38 of 1977. § Wholly owned by the government of South Africa and reports to the Minister of Energy as the shareholder representative. § Supports the Do. E in ensuring security of energy supply in the country and implements government policy and programmes. § Is key in catalysing new technologies and removing market barriers in the energy sector

5 About the CEF Group § In 2004 was instructed by then Minister of Energy to start the RE industry in South Africa. § Today CEF, in partnership with private companies, has interests in o The 13 MW waste-to-energy project in the City of Johannesburg o The 100 MW CSP ACWA Redstone in Postmasburg in the Northern Cape § CEF is leading the feasibility study for the proposed Solar Park Programme in the Northern Cape

6 6 The future of energy will be governed by the 3 Ds - energy will be cleaner, more accessible, intelligent, connected and responsive.

7 Evolution of the ESI 1. Vertically Integrated Utility Generation – utility Transmission – utility Distribution – utility (+ Municipalities in SA) Captive customers 2. IPPs introduced under a Single Buyer Model Generation: § Utility § IPPs Single buyer (commonly utility) Transmission - utility 3. Unbundled Utility, Competitive generation Generation: § Generation Co. / SOE. § IPPs ISMO & Transmission Co. / SOE. Distribution – Distribution Co. /SOE. (+ Municipalities in SA) Many distribution Companies All customers contestable Distribution – utility Captive customers 4. Fully Liberalised ESI Captive customers Contestable customers

8 Proliferation of Private PPAs in South Africa § Anglo American 60 MW Solar PV supply IPP tender. § Sibanye Gold 50 MW Solar PV IPP. § Urban solar farms are emerging. § Currently the regulations requires that >1 MW private IPP generation obtain Ministerial approval. § Advantage of RE IPPs not being dependant on National Treasury guarantees. § Have the potential to support local manufacturing and new SMMEs § An opportunity (not a risk) for national & local municipality to lead the change and benefit from it.

9 Thank You