Programme
SAWEP
17 September 2010
Mr Paul Brewah
Deputy Resident Representative (Operations)
UN House Level 10
Metro Park Building
351 Schoeman Street
Pretoria
Dear Paul
South Africa Wind Energy Programme: Wind Atlas project: Request for Direct Payment
1.Purpose
Please find enclosed (Addendum A) Department of Energy (DoE) letter requesting UNDP to make a direct payment to the Central Energy Fund (CEF) regarding the Wind Atlas project, CSIR 1st(R1,253,067 +VAT R175,429.38) and 2nd(R1,350,360 +R189,050.40) progress payments (Addendum B, C)
2. Background
The Wind Atlas project background, organisation, operational and financial management, utilisation of funds, roles and responsibilities are described in detail in my letter of 6 August 2009 (see Addendum D)
3. Budget increase
The 3rd SAWEP Project Steering committee meeting took place on 5 August 2009 (see Addendum E)
5.3Outcome 4: 4.1 Discussion regarding the Wind Atlas for South Africa project, and the revised budget for the CSIR component for an additional 1.8 million from SAWEP, and 1.1 million from the REMT project. The DG has signed off R 5million from the SAWEP budget to be utilised by SANERI for CSIR activities. The initial CSIR wind measurements and monitoring budget was not well worked in detail. Upon re-working of the budget by the CSIR, with support from SAWEP and RDE, the new budget proposed for the CSIR is R8 million.
The PSC gave their approval to SAWEP to go ahead and request DoE DG for additional SAWEP funds R1.8 million and REMT contributing R1.1 million, total R8 million needed for the CSIR component, as this is an important project, the masts are needed for the wind measurements (wind measurements and monitoring is a critical path) and there is funding available within the SAWEP and REMT budget, for an additional R3 million to be committed.
Action / Responsible Person / DateDG Submission – additional funding (R 3million) for CSIR component on the WASA Project / Andre Otto / August 2009
The Department of Energy Director General approved on 25 February 2010 an additional R1,803,963 (including R401,072 contingency) on the SAWEPbudget to fund the Wind Atlas for South Africa project (see Addendum F). The balance of funds required R1,196,037 (R3 mill – R1,803,963) to be funded by other sources, including SAWEP funds not utilized by the end of the project.
This brings the total SAWEP Wind Atlas project budget to R6.8 million (R5 million approved by DME DG on 15 Dec 2008 + R1.8 million approved by DoE DG on 25 February 2010). The Royal Danish Embassy is co-financing the project to the tune of DKK9,998,441.20
4. Budget status
Of the total R6.8 million, R3,799,464 has already been paid (see Addendum G) as an advance payment by UNDP on 11 September 2009 to CEFas per the Payment Plan CSIR (see Addendum HI, Annexure B) (total payment to CEF: R4,331,388.96 = R3,799.464 +VAT R531,924.96 paid and reclaimed by UNDP)
CEF, on behalf of SANERI, paidR4,331,388.96 over to the CSIR on 26 October 2009 (see Addendum G). The 1st(R1,253,067) and 2nd (R1,350,360) CSIR progress payments (see Addendum HI, Annexure B, Payment Plan CSIR) are provided for on the SAWEP Annual Work Plan 2010.
5. Financial reporting
The signed financial and accompanied progress reports are attached (see Addendum JK)
Financial report summary
August to December 2009 / January to March 2010 / April – June 2010 / Total ExpenditureOpening balance / R3,799,464 / R3,080,193 / R1,281,268.09
Closing balance / R3,080,193 / R1,281,268.09 / R819,473.58
Expenditure / R719,271 / R1,798,924.91 / R461,794.51 / 2,979,990.42
Signed by SANERI / 15/03/2010 / 13/07/2010 / 27/07/2010
Recommended by WASA PSC / 7/01/2010
(Addendum N) / 13/08/2010
(Addendum N) / 13/08/2010
(Addendum N)
Signed by DoE / 21/04/2010 / 20/08/2010 / 27/08/2010
The 2010, 2nd quarter financial report, April – June 2010, indicate planned expenditure for the 3rd quarter, July – September 2010, of R1,580,390. Available funds are R819,473.58 (R3,799,464 – R2,979,990.42)
6. Project progress reporting
The project implementationstarted in July 2009 (see Addendum L).
The Basic Environmental Impact Assessment process of the 10 wind measurementmasts installed, started in August 2009 with the last 3 sites Basic Assessment Reports approved by DWEA in June 2010. The work plan July 2009 had to be extended with about 4 months due to the time taken for the DWEA approvals (see Addendum M).
The following CSIR activities, as per the work plan July 2010 (Addendum M) and Payment Plan CSIR (Addendum HI, Annexure B) have been undertaken for the period August 2009 to June 2010 and reported in the project progress reports (Addendum JK):
CSIR Payment Plan (Addendum HI, Annexure B)
- WP2.01: Siting, design, procurement, supply, installation and commission of 10 wind masts have been completed.
- WP2.02: The measurement, data collection and processing system have been installed at the CSIR Stellenbosch and are operational. The wind data display and download websites will be launched by the DoE Minister at the 2nd Annual Wind Energy Seminar on 28 September 2010.
- WP3.01: Workshop on Micro-scale modelling was held from 23 – 25 November
- WP1.03b, WP4.02a Presentations on first modeling methods and application of the Numerical Wind Atlas were presented at the Wind Atlas workshop on 4 March 2010 (140+ participants)
7. Wind Atlas Project Steering Committee recommendation
The 4th Wind Atlas Project Steering Committee meeting took place on 13 August 2010
(see Addendum N)
8.Financial Report
AO presented, the PSC accepted and recommended that the DoE sign the SANERI signed CSIR financial progress reports: January – March 2010, April to June 2010.
The PSC also recommended in view that the SANERI financial report: April – June 2010 indicates that the advance will be utilised in the 3rd quarter, bulk of WP2 which is the siting, design, procurement, supply, installation and commissioning of the wind measurements masts and SAWEP Phase 1 ending end of September 2010, that DoE request UNDP for CSIR progress payments (1st and 2nd) provided for on the SAWEP Annual workplan 2010 and budget.
9. Conclusion
The advance payment (R3,799,464) enabled the CSIR to completethe activities indicated in the CSIR Payment Plan (Addendum HI, Annexure B), under columns Jul 09 and Dec 09. The progress payments for achieving these milestones are, column Jul 09, R1,253.067 and column Dec09, R1,350,360.
The balance of the advance payment by June 2010 (see financial report Apr – Jun 2010, Addendum 9) is R819,473.58, while planned expenditure for the 3rd quarter is indicated as R1,580,390. The advance payment (August 2009) will be utilized before end of the 3rd quarter 2010.
I therefore support and will appreciate if the DoE direct payment request CSIR 1st(R1,253,067 +VAT R175,429.38)and 2nd(R1,350,360 +R189,050.40)progress payments can be processed as soon as possible. Please inform on any issues you may have and or encounter in processing of the DoE direct payment request. An invitation letter to the 2nd Annual Wind Energy Seminar (28 September 2010), at which the Wind Atlas data display and download websites will be launched by the DoE Minister, has been sent to Dr Zacarias (see Addendum O).
Regards
Andre Otto
Project Manager: SAWEP
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