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Framework urgently needed

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Framework urgently needed

27th November 2020

By: Terence Creamer
Creamer Media Editor

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For years, South Africans have had a vague awareness that some of Eskom’s coal stations are approaching the end of their useful lives and that decommissioning is inevitable. That future prospect is fast becoming an imminent reality.

Over the coming five years, Eskom will officially decommission the first three power stations – Grootvlei, Komati and Hendrina – and by the end of the decade nearly 10 GW of coal capacity is scheduled to be shut. By 2040, ten of Eskom’s 15 coal plants will no longer be operational and by 2050, Eskom has set a goal of being “net zero”; offsetting any residual coal emissions through the purchase of carbon credits, or through investments in projects that remove carbon dioxide from the atmosphere.

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Given the steep fall in solar photovoltaic (PV) and wind costs and the prospect of equally steep declines in battery energy storage, South Africa is in the fortunate position of not having to replace its coal fleet with expensive, low-carbon solutions. The cheapest new-build mix is now indisputably a combination of solar PV, wind and flexible generators.

This absence of a trade-off between cheap and clean can be enhanced even further once the cheap but variable renewable electricity is not curtailed or wasted at times of low demand, but rather used, through sector coupling, in other harder-to-decarbonise sectors, such as transport and industry. Given our resources, South Africa is also well placed to use its relatively cheap renewable electricity as the basis for becoming a global green-hydrogen superpower.

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In other words, South Africa is in an energy transition ‘sweet spot’.

This is a pretty meaningless assertion, though, for those individuals, businesses and communities that remain inextricably tied to the country’s large and well-entrenched coal industry. The closure of coal power stations and nonexport mines poses an existential threat. Even those mines that sell the bulk of their coal to markets in Asia and elsewhere are not immune in light of the growing number of countries that have already announced coal-exit plans.

Is there a way to leverage the opportunity being presented by the energy transition without leaving millions behind? This question has not yet been satisfactorily answered, notwithstanding increasingly vocal government and Eskom assertions that they are committed to a so-called ‘just transition’.

One positive has been the establishment by Eskom of a just energy transition office, headed by Mandy Rambharos, who insists that equal weighting will be given by the utility to both the ‘just’ and the ‘transition’ components as it moves to decommission the first power stations. Equally positive are moves to enter into partnerships with the private sector to ‘repower’ some of the stations using alternative generation technologies and/or ‘repurpose’ the sites for nonenergy- related economic activities, such as agriculture and water treatment.

Worryingly, though, is the fact that South Africa still lacks an overarching just-transition framework, without which the concept and the transition could well end up being distorted and even manipulated by vested interests.

 

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