REPUBLIC%20OF%20SOUTH%20AFRICA

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• REPUBLIC OF SOUTH AFRICA
• GAS REGULATOR LEVIES BILL
• (As introduced in the National Assembly as a
  money Bill)
• (The English text is the official text of the
  Bill)

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BACKGROUND

• Gas Act passed 2001
• Establishes a National Gas Regulator
•   
• Funds required to operationalise National Gas
  Regulator

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KEY FEATURES

• IMPOSITION OF LEVIES-
• Gas Regulator imposes levies (could be different
  amounts for different years)
• based on amount of gas at inlet flange
• after publication for comment
• after notifying Minister in writing
• after providing evidence of consultation

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Why the inlet flanges?

• a)  International practice
• b)  In line with SA tax policy (taxation at
  source)
• c)   Effective non-intrusive measurement
  technologies exist
• d)   Administrative efficiencies far fewer
  points for Regulator to monitor than customers

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Approval

• a. Minister of Minerals Energy in concurrence
  with Minister of Finance
• b. 30 days notice
• c. reviewed annually

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DISPOSAL AND MANAGEMENT OF LEVIES

• 1. Separate Gas Regulator account
•  
• 2.  Annual budget and business plan to
  Minister of Minerals and Energy
•  
•  3.  Concurrence of Minister of Finance

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NON PAYMENT OF LEVIES

• 1 Interest on unpaid levies
• 2 PFMA interest rate

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LEVY LAPSES AFTER 5 YEARS

• 1.   Concurrence of Minister of Minerals and
  Energy and of Finance to extend beyond 5 years
• 2. After Minister of Minerals and Energy
  commissions review of Regualtors performance.

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ASSESSMENT AND PERFORMANCE OF REGULATOR

• 1.   Minister of Minerals and Energy commissions
  any person if there is concern in gas industry
  or inadequate performance
• 2. Must assess at least once in 5 years

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PART TWO

• SINGLE ENERGY REGULATOR

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Cabinet decision single energy regulator

• Requires coordination of legislation-
•      National Electricity Regulator (Electricity
  Supply industry bill)
•      National Gas Regulator
•      National Petroleum Pipelines Regulator
  (Bill pending)

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CABINET DECISIONS

• Appoint new persons to NER, gas and petroleum
  pipelines boards.
• Fill technical posts for gas and later petroleum
  pipelines.
• Amend Electricity Act, Gas Act and Petroleum
  Pipelines Bill to provide for same persons on all
  three boards.

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CABINET DECISION(continued)

• Investigate replacing Electricity Act, Gas Act
  and Petroleum Pipelines Bill with a single Energy
  Regulator Act.
• Integrate remaining liquid fuels regulatory
  functions once process complete.
• Retain Nuclear Regulator in current form (health
  and safety regulator).

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COMPARISONS
Electricity Act Gas Act Electricity PPL Bills
Members 7 to 9 full- or part-time 5 part-time 5 full-time
Gov. Officials No more than 3 None None
CEO Board member Not Board member Not Board member
Funds License fees Donations Fiscus, Levies Mainly fees levies
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DECISION MAKING
Electricity Act No requirements except for appeal to Minister Gas Act, Electricity PPL Bills Meetings public. Decisions must be Procedurally fair Based on facts and evidence In writing Explained. Review by High Court.
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Structure Existing Legislation
Electricity Act (Act 41 of 1987) Gas Act
Members (discretionary) 5 full-time plus 2 part-time 5 part-time
Funding Levies Donations Initial loan then levies
Decision making Adopt Gas Act decision making See previous slide
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WAY FORWARDSTEP ONE 2002

• Advertise for 5 full-time board members for
  electricity, gas and, ultimately, petroleum
  pipelines.
• NER board resigns (on request).
• Minister appoints same five regulators appointed
  for separate electricity and gas boards and later
  Petroleum Pipelines.
• Two additional members for NER to make 7.
• CEO board member for NER but not for gas
• Pass gas levy bill plus obtain loan.

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Step Two Structure of New Electricity Act
Petroleum Pipelines Act
Electricity Regulation Act Gas Act Petroleum Pipelines Act
Members (mandatory) 5 full-time Same 5 Same 5
Primary Funding Levy Levy Levy
Decision making As per Gas Act Gas Act As per Gas Act
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Procedures

• Pass Electricity and Petroleum Pipeline Bills
  plus Petroleum Pipeline Levy Bill plus minor
  amendments to Gas Act.
• CEO no longer member of any board.
• The same 5 full-time members appointed for
  separate electricity, gas and petroleum pipelines
  boards in accordance with the legislation.

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Step Three Structure of Energy Regulator Act
Electricity Gas Petroleum pipelines Liquid fuels
Members 5 full-time common Board 5 full-time common Board 5 full-time common Board 5 full-time common Board
Primary funding Levy Levy Levy ?
Decision making As per Gas Act Same Same Same?
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Procedures

• Pass Energy Regulator Act.
• Appoint combined board for electricity, gas and
  petroleum pipelines.
• CEO not a member of the board.
• Incorporate liquid fuel functions.