By NNN-BuaNews
Cape Town : The South African Government is moving cautiously as it proceeds with its strategy for biofuels production, reducing the initial biofuels production target of 4.5 percent by 2013 to two percent in the face of increased concern at the prospect of rising food prices.
Speaking to reporters following a post-cabinet briefing by government spokesperson Themba Maseko, Minister of Minerals and Energy Buyelwa Sonjica said that concerns over food security – and the price of key staple foods – played a major role in the decision to reduce the target.
For the same reason, the biofuels industrial strategy approved by Cabinet on Wednesday, December 6, proposed that the use of maize be completely excluded from the initial stages of the development of the biofuels industry.
“This [decision] is largely due to food security concerns, fears around price increases and the fact that maize is a staple food source for the majority of the poor in the country,” Ms Sonjica said.
This move comes amid concern over rising food prices should basic, staple foods be diverted to biofuel production, which would dramatically increase demand, as has already been seen elsewhere in the world as a result of the burgeoning biofuel industry.
The five years between next year and 2013 will see the first phase of the biofuel industry, after which targets will be reviewed.
The period from 2008 – 2013 “is really a pilot stage when we will evaluate the impact of it [the biofuels industry] on the agricultural situation in the country”, said the Minerals and Energy Minister.
Meanwhile, incentives for biofuel production will continue, in the form of levies, she said.
The fuel levy exemption for biodiesel will increase from the current 40 percent to 50 percent, she said, adding that the status quo for the bio-ethanol levy will remain, at 100 percent.
The blending targets for these fuels is two percent for biodiesel and eight percent for bio-ethanol, for which sugar cane and sugar beet remain key crop platforms.
Meanwhile, government’s masterplan for the electricity sector is swinging into action, said the Minerals and Energy minister.
“Recent experiences with blackouts [powercuts] and brownouts [fuel shortages] in South Africa and abroad have demonstrated the vulnerability of world economies to electricity shortages and point to the need for coordinated long term planning,” Ms Sonjica said.
Now, South Africa would be joining the handful of countries like the United States and Norway in implementing “a broad framework of interventions” necessary to ensure continued energy security.
Key among these interventions will be continued attention over the long term to demand-side management and energy efficiency, which the minister described as a “critical strategy that can mitigate against the increasing electricity demand growth”.
The recently established Energy Efficiency Agency will be “vigorously” taking up the programme with a number of activities aimed at widening the pool of users who use electricity efficiently and finding ways to increase efficiency, she said.
Already, 37 big companies have signed up to an electricity-saving programme, Ms Sonjica said, adding that “the business of energy efficiency is everybody’s business”.