Coal is still very much part of South Africa’s energy mix, given the abundance of the mineral, Energy Minister Jeff Radebe has said.
The minister held a briefing on Independent Power Producers (IPPs) in Pretoria on Sunday. He addressed concerns of job losses in the coal sector, which have been attributed to the introduction of IPPs. According to the minister, this is not the case.
“It is true that coal jobs are at risk in South Africa, but this is not as a result of the renewable energy independent power producer programme,” he said.
Radebe explained that as early as the integrated resources plan (IRP) 2010, Eskom had indicated it would start decommissioning older coal-fired stations which were reaching the end of their commercial and operational life. About 13 000MW of coal-fired capacity is scheduled for decommissioning by 2030.
Commercial banks such as Standard Bank and Nedbank are also no longer willing to support coal-fired power project, Radebe said. “The World Bank and other development finance institutions as well as commercial banks have also instituted a no-coal policy.”
This follows international trends where countries part of the Organisation for Economic Co-operation and Development, which are taking steps to mitigate the effects of climate change. Countries like China, India and the US are also down scaling on coal-fired fleets.
“This does not mean we shall not procure cleaner coal-fired technologies in the future. Coal is part of the energy mix and due to the abundance thereof, SA would be hard-pressed should we abandon coal-fired generation,” Radebe said.
“Our policy will become clearer with the imminent finalisation of the IRP update.”
President Cyril Ramaphosa recently announced the unbundling of Eskom into three entities – generation, transmission and distribution. The unbundling would see more competition introduced in the generation sector in the form of IPPs, which some unions have opposed, as they believe it would lead to massive job losses in the coal sector.
Public Enterprises Minister Pravin Gordhan has told the National Assembly that government is embarking on a consultation process with labour. The public enterprises department will meet with the National Economic Development and Labour Council on March 5 regarding the issues at Eskom. Gordhan has said that government and Eskom need to ensure that the 48 000 employees at Eskom have some sort of job security and that workers are better skilled for jobs in the renewables sector.
Radebe echoed these views at the briefing on Sunday, indicating that government has to ensure a “responsible, just” transition to a cleaner future, and find ways to mitigate the risks to coal miners and their families.
One of the outcomes of the Jobs Summit held last year was the establishment of a presidential task team on climate change, to oversee the development and implementation of a “just transition process,” Radebe said.
Benefits of renewable energy
In eight years, renewable energy projects have attracted R209.4-billion in committed private investment. So far over 38 700 job years have been created.
Local communities have also benefited from R1-billion spent by IPPs on education, upskilling of teachers and classrooms and 600 bursaries have been issued to students in disadvantaged communities.
Other benefits include black ownership in IPPs of 52% or R31.4-billion pf the R60.9-billion in total equity, according to the minister. This is more than the 40% requirement, Radebe said. Local communities have also a stake in projects through trusts.
Renewable energy has helped reduce carbon emissions by 33.2 million tonnes and resulted in water savings of 39.2 million kilolitres by December 31 2018. — Fin24