The department of forestry, fisheries and the environment has refused to grant environmental authorisation to Karpowership SA for its three gas-to-power projects.
Expensive, dangerous and exclusionary. That’s how an environmental justice organisation has described the government’s controversial resolution to use powerships as part of the emergency electricity procurement plan.
A Turkish company has secured the lion’s share of the procurement plan. Last month, the mineral resources and energy department announced Karpowership SA as a preferred bidder under the risk mitigation independent power producers procurement programme to ease blackouts. But it is a 20-year deal.
Karpowership, part of Turkey’s Karadeniz Energy Group, is a private electricity exporter that runs a floating power plant fleet. The firm will use liquefied natural gas to produce 1 220 megawatts under the 1 845MW emergency power programme. The price tag is an estimated R10.9-billion annually.
Avena Jacklin, the climate and energy justice campaign manager at groundWork, said signing a 20-year contract to procure power from these vessels effectively locks in gas for that period, “crowding out space for ever-cheaper and more reliable clean energy and exacerbating the climate crisis”.
This is contained in groundWork’s submission on the draft environmental impact assessments for the proposed gas-to-power ships projects in the ports of Coega, Richards Bay and Saldanha, the deadline for which closed last week.
Jacklin said Karpowership does not fit into the presidential commitment to a jjust transition towards a low-carbon, inclusive, climate change-resilient economy and society. South Africa’s energy emergency has been created by decision-making skewed towards fossil fuels development.
“Attempts to resolve the emergency through additional fossil fuel investments, dependent on the whims of global energy markets, will dig a yet deeper hole and put a just transition to a low-carbon economy further out of reach.”
Jacklin said this will result in higher tariffs and less affordable and accessible energy — the opposite of what is intended for the social goals of these procurement processes.
The powerships would be “stranded assets, literally, long before the 20-year contracts run out,” said Harald Winkler, an energy and climate policy professor at the University of Cape Town’s faculty of engineering and the built environment. Powerships are not what South Africa needs. “One might resort to powerships to keep the lights on while building more permanent solutions.”
“Ten billion rand will fund almost 10 years of transmission development, which we need to scale up renewable energy. The IRP2019 [Integrated Resource Plan] has a large allocation of wind and solar PV [photovoltaic] — and there is a bit of these technologies in the procurement programme,” Winkler said.
“Meanwhile, the powerships will not be paid for by Eskom — which is deep in debt — but by customers. If the powerships deal is finalised you and I are on the hook for two decades of gas at much higher tariffs.”
Consequences
Janet Solomon, of Oceans not Oil, said in the nonprofit’s submission on the draft environmental impact assessments that, to date, no independent strategic environmental assessment has been conducted for marine oil and gas development.
“Negative impacts of this energy sector, including oil spills, fossil gas leaks and pollution to biodiversity have been well documented and have massive health, wildlife, economic and societal consequences.”
Solomon said South Africa is already warming at twice the global average. “There is an urgent need to reduce methane emissions to avoid putting the rights and lives of future generations at risk.”
Methane is a major greenhouse gas. Although gas produces fewer carbon emissions than coal when burned, the overall effect of gas on climate is increased by methane leaks during production, transportation and distribution. These are known as fugitive emissions.
Geologist Jan Arkert, of nonprofit Green Connection, said the government is advocating gas as a clean, bridging source of energy between coal and renewable energy. “The country is aggressively promoting exploration off the coast for conventional oil and gas resources, as well as unconventional terrestrial resources, which include shale gas, coalbed methane and in situ gasification.”
He said the government has accepted environmental impact assessments for the construction of a gas pipeline network that will feed gas to downstream users, which include gas-powered power stations along the coast as well as in Gauteng and Mpumalanga. But a range of studies disprove the claim that natural gas is a transitional bridge fuel that can lower greenhouse gas emissions while renewable energy solutions are developed.
Other research has shown that the expanded use of natural gas impedes investments in and the use of renewable energy infrastructure.
Liziwe McDaid, the strategic lead of Green Connection, said there were numerous reports in the media about how, last year, a senior official in the department of environment, forestry and fisheries was “persuaded” to grant Karpowership exemption from conducting mandatory environmental impact assessments.
“The excuse provided was that South Africa desperately needed extra electricity supplies, due to the Covid-19 crisis. This was later retracted by the department of environment, forestry and fisheries, following an outcry from civil society. However, these dangerous compromises that the government is prepared to make on behalf of the people are very worrying.”
The environmental impact assessments reports for the Karpowership projects are significantly flawed, she said. “There is too much missing data, too many negative impacts for South Africans and the environment that have been brushed over and not given the scrutiny it needs to make informed decisions.
“By our assessment, these Karpowerships are not worth the risk, especially not at the expense of our coastal communities.”
Clyde Mallinson, a geologist who focuses on the energy sector, said the only conclusion that could be drawn was that the risk mitigation programme was designed to create a gas-offtake market, “to ensure that we had an anchor offtake tenant for gas so that we could proceed with drilling Brulpadda off the coast and so that we could potentially proceed with fracking the Karoo, if it comes to that”.
The department of mineral resources and energy told the Mail & Guardian that the country’s electricity planning takes into account the need to reduce carbon emissions over time in line with the country’s Nationally Determined Contributions, the cornerstone of South Africa’s climate change response.
“The IRP indicates that gas will play a significant role as a complimentary source of supply when combined with renewables. The volume of gas in the procurement programme will in no way undermine South Africa’s commitments to reduce emissions from the energy sector.”
Karpowership, Shell have ‘exclusive deal’
The Istanbul-based ship-to-shore power producer, Karpowership, says its technology solution is well-suited to South Africa’s energy landscape. It is set to provide emergency power to the country for the next 20 years.
Karpowership SA Coega, Karpowership SA Richards Bay and Karpowership SA Saldanha were last month named among eight preferred bidders for the risk mitigation independent power producers procurement programme.
The other preferred bidders are ACWA Power Project DAO, Mulilo Total Coega, Mulilo Total Hydra Storage, Oya Energy Hybrid Facility and Umoyilanga Energy.
Karpowership said: “Powerships are fully self-contained floating power stations that operate on regasified liquefied natural gas [LNG] together with specialised floating storage and regasification units for the LNG and are constructed and immediately available for deployment in South Africa.”
It did not divulge how much the deal would cost, but a recent Council for Scientific and Industrial Research presentation estimated it to be about R10.9-billion annually or about R218-billion over the 20-year contract.
The vessels are set to arrive in 2022 at Richards Bay, Coega and Saldanha.
Once powerships are sailed into a port, a grid connection is established and the generated electricity is directly fed into the national grid.
“This avoids lengthy construction times and associated risk. South Africa needs a fast, reliable, implementable solution that can immediately mitigate the effects of load shedding. Using LNG, powerships generate electricity at an affordable all-inclusive delivered cost, which includes all capital costs such as fuel, equipment, and all operational and maintenance costs,” Karpowership said.
The vessels are being leased by the project company; they cannot be built in South Africa because of infrastructure constraints. But the company said they would be operated and maintained by local businesses for the duration of the project.
“The 1 220MW [megawatts] to be supplied by Karpowership SA will completely eliminate an entire stage of load-shedding and will go a long way to stopping a second stage,” it said.
The department of mineral resources and energy said the new power will be connected to the grid by August next year.
Karpowership SA and Shell have created a “long-term, exclusive deal” to ensure that South Africa can get competitively priced, “clean” fuel, the company said.
The company said: “Our climate change and air emission specialists have conducted a scientific assessment of the environmental effects of powerships and determined that the impacts are insignificant even when assessed cumulatively against gas projects that are in the process of planning and implementation.”
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