Presentation Outline • SED/ED in the REI4P • Local Community Ownership • Issues for Consideration • Possible Solutions • SED/ED Reporting Tools • Proposed Fund • Examples of SED/ED Projects Above: Khi Solar One (www.abeinsa.com) Below: Hopefield Wind Farm (www.engineeringnews.co.za)
SED-ED in the REI4P • Both SED and Enterprise Development require expenditure from revenue • 1 to 1.5% and 0 to 0.6% commitments respectively • Initial SED/ED expenditure occurred in the 4th quarter 2013 • 34 projects are now in operation • Reporting to the IPP Office required • Responsibility for SED/ED lies with IPPs/Sellers • IPP office – facilitatory role
SED-ED in the REI4P • 4 ED elements mention Local Communities as beneficiaries At least 2.5% of shares in the electricity selling company A minimum of 12% of all jobs should be held by the local in the energy project should communities be awarded to members of the local communities 1-1.5% of all earnings should be contributed to socio-economic development projects Up to 0.6% of all earnings may be spent on enterprise development • 3 of the elements viz. SED, Enterprise Development and Local Community Ownership lead to financial contributions from Sellers
SED and Enterprise Development Contributions • Total commitments of R 9.8 billion and R 2.6 billion respectively • Total expenditure to date is approximately R28 million as per Annexure B • The graph shows the split in different categories* 12 10 8 R Million 6 4 2 0 Education Health Care Social and Infrastructur Developmen Other Allocated Enterprise Welfare Not e t *Early Childhood Development included in Education
Local Community Ownership • Benefits (dividend flows) accrue over 20 years R 4,000,000 R38.5 billion R 3,500,000 R 3,000,000 R12.2 billion R 2,500,000 R 2,000,000 R 1,500,000 R 1,000,000 R 500,000 R - R -500,000 R -1,000,000 R -1,500,000 2013 2017 2021 2025 2029 2033 2037 Gross Income Earned Debt Service Costs
Issues for Consideration • Coordination Lack of coordination between IPPs, local government structures and other entities at the local level e.g. SED/LED activities Fragmented delivery and implementation mechanisms Insufficient economies of scale in separate, individual SED/ED efforts by IPPs Limited community absorption capacity in sparsely populated areas • Monitoring Performance Management is still too weak Submitted ED Plans, Annexure A and Annexure B often lack sufficient detail – monitoring, evaluation & onward reporting – more difficult • Integration of Community Trusts
Possible Solutions • Strengthening local coordination Local IPP-SED forums with and without other stakeholders (e.g. the co- ordination forums in Poffadder, Upington and Pixley ka Seme) Community Hall Meetings Partnership across IPP and implementing partners to reduce ‘structures’ Participation in local LED Forums and other coordination forums Relaxing the 50km radius • Strengthening central monitoring: Strong performance management • Extension of project monitoring to community trusts
SED/ED Reporting Tools SED • Annexure A measures the INPUT to SED projects, the amount of funds/revenue contributions • Annexure B gives information on the utilisation of funds SED Project • Ideally performance management is carried out via SMART indicators, measuring OUTPUTS • The SMART outputs should be part of broader strategy to Impact achieve local development IMPACTS
The ED Plan • ED Plans are the foundation for SED strategy formulation • The ED Plan connects INPUTS , OUTPUTS and IMPACTS for SED-ED projects in the future • Template for preparation contained in the Implementation Agreement • Submissions usually do not provide sufficient details on anticipated SED/ED projects • Annexures A and B report on the achievements as in accordance with what was envisaged in the plan
Central SED/ED Fund (“Large Fund”) • Establishment of centralised fund to facilitate & coordinate SED/ED initiatives • Pooling of funds for future bidding windows • Possible integration with current projects
Examples of SED projects • In the following slides a selection of SED projects is described… – Educational Projects (3 Slides) – Supporting FARR – Enterprise Development Projects – Housing Programme – Old Age Home – Environmental Conservation
Educational Projects 1/3 • The Douglas Socio Economic Development Company supplements Maths & Science education in 11 schools in the Douglas area. • Beneficiaries are the learners in the Douglas designated area. • Outputs: Teachers’ salaries, students allowances, maths competitions, stationery • Expenditure of approx. R 1.8 million since January 2014 Pictures: Grade 12 exam practice at Ho ё rskool Douglas and the first day at Bongani Secondary
Educational Projects 2/3 • Several IPPs are engaged in ECD care development since July 2014 • 11 ECD caretaker trained towards NQF 4 and equip- ment supplied in Renosterberg • 33 bursaries for ECD caretakers around De Aar and 20 for practitioners around Kimberley via the Dept of Education • Audits on around 30 ECD centres around De Aar and Kimberley to provide equipment • Training, toys and equipment for Ubunye Day Care in Upington • Total expenditure around R 1 520 000 Pictures: Caretake in Ubunye, toys and the hand-over of bursaries to the Dept of Education
Educational Projects 3/3 • Africa Skills FET College 15 months courses from August 2013 – November 2014 • 35 learners were enrolled for apprenticeships as either plumbers or electricians • 26 learners successfully completed the course and received certificates. Pictures: Learners at Ubuntu and • Total expenditure of approx. R771 000 Beaufort West Local Municipalities
Supporting FARR • Foundation for Alcohol-Related Research (FARR) received funding for activities in Emthanjeni and Renosterberg Local Municipalities • Activities financed: – Roll out of the ‘De Aar programme’ to Renosterberg – A four-year programme addressing alcohol abuse and foetal alcohol spectrum disorder (FASD) – The Healthy Mother, Healthy Baby programme • R 2.1 million spent to date
Enterprise Development Projects • Equipment provision to Tsantsabane and Upington businesses: funeral services, catering, fitting & electrical works • Learners trained to work as security guards and for monitoring the bird and bat population on the wind farm in Ubuntu • 2 Ostrich farms in Emthanjeni were upgraded with equipment and live chicks • Development of a full-scale service provider for PV plants in Emthanjeni • Continuation of Galeshwe business hub • Picture: Bats and Birds training, Approx. R 3.15 million fencing of Ostrich farm
Housing Programme • Upgrading low cost housing with solar water heaters, insulation, efficient light bulbs, water supply and safe reticulation • 18 unemployed from the community trained to become artisans and employed • 33 houses upgraded • Expenditure of approx. R 1.16 million Pictures: Residents at work in a similar project
Old Age Home • An old age home run by an NGO was renovated • Including: Tiling of passage, electrical repairs, burglar bars, repair of windows and frames, and painting of building Pictures: Beneficiaries from the old age home • Total cost: R 97 170
Environmental Conservation • On a 1 000 hectares of land alien vegetation is removed in cooperation with SANparks • Local businesses carry out all the works, which constitutes Enterprise Development • Expenditure to date: R2.1 million Pictures: West Coast National Park flower bed, www.safarinow.com
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