Ramaphosa failed to offer us any real Sona power

Heaps of trouble: President Cyril Ramaphosa’s State of the Nation address should have given the country a plan for future energy production that is not dependent on coal. (Paul Botes)

Heaps of trouble: President Cyril Ramaphosa’s State of the Nation address should have given the country a plan for future energy production that is not dependent on coal. (Paul Botes)

NEWS ANALYSIS

President Cyril Ramaphosa has few peers who can master occasions such as a State of the Nation address (Sona) that leave you feeling good — even though when you think about it afterwards, it is not always clear what he will actually do.

But this last Sona has been widely criticised for, among other things, lacking precision and detail. And for being too fanciful; speaking of bullet trains and smart cities when our municipalities and state enterprises are crisis-ridden and dysfunctional.

There was perhaps just one key factor that could have given us optimism on the way forward: clarity on how the coal-fired Eskom train wreck will be addressed.

What we heard was disconcerting enough: R230-billion of government funds will be accessed — we don’t know from where and how — to be front-loaded to deal with the power utility’s collapsing revenues and spiralling debts.

We will not be building bullet trains or smart cities until this collective coal habit is broken.A report this week from global think-tank the Overseas Development Institute (ODI), ahead of this weekend’s G20 meeting in Osaka, Japan, finds that G20 governments continue to provide billions of dollars of support for the production and consumption of fossil fuels, spending at least $63.9-billion a year on coal, the most polluting of these.

These governments have neglected to define or document the full extent of their subsidies, says the ODI report, titled G20 Coal Subsidies: Tracking Government Support for a Fading Industry.

“Our analysis finds that G20 governments continue to support coal through $27.6-billion in domestic and international public finance, $15.4-billion in fiscal support, and $20.9-billion in state-owned enterprise investments per year across the G20.

“We also find that government support for the production of coal-fired power has increased in recent years, from just over $17.2-billion a year in 2013-14 to nearly $47.3-billion a year in 2016-17.”

The ODI says investments by state-owned coal mining and coal-fired power companies, amounting to at least $20.9-billion a year, were identified in eight of the G20 countries. “The highest amounts of investment identified were by Chinese, Indian and South African state enterprises, which provided $8.8-billion, $6.4-billion and $3.4-billion a year, respectively.”

In South Africa’s case, the ODI says, given the scale of generation and grid infrastructure associated with coal-fired power, it has historically been used to power large urban centres and has often bypassed the poorest, who are near the grid, and excluded those in rural areas entirely.
“Despite all the support from the taxpayer, South Africa’s ageing transmission and generation infrastructure prevents coal from improving energy access.”

The lower cost and smaller scale of renewables projects would allow for improved energy access, undermining the myth that coal enables countries to give electricity access to poor citizens, the ODI notes.

Ramaphosa would have done well to outline how we will stop pouring fortunes into Eskom’s bottomless pit, and how clean, green energy can really mean a better life for all. That would have been a Sona that we have come to expect from him.

Kevin Davie

Kevin Davie

Kevin Davie is M&G's business editor. A journalist for more than 30 years, he has worked in senior positions at most major titles in the country. Davie is a Nieman Fellow (1995-1996) and cyberspace innovator, having co-founded SA's first online-only news portal, Woza, and the first online stockbroking operation. He is a lecturer at Wits Journalism. In his spare time he can be found riding a bicycle, usually somewhere remote. Read more from Kevin Davie

    Client Media Releases

    UKZN School of Engineering celebrates accreditation from ECSA
    MTN celebrates 25 years of enhancing lives through superior network connectivity
    Financial services businesses focus on CX