A new report from the International Institute for Sustainable Development (IISD) suggests that Eskom can be a leader in South Africa’s transition to renewable energy.
Eskom relies on ageing coal-fired power stations that have resulted in endless rounds of load-shedding. The company says it uses more than 90 million tons of coal every year.
Although South Africa’s Integrated Resource Plan includes a mix of wind and solar, electricity from burning coal remains dominant. It also included natural gas.
And producers of renewable energy face a litany of challenges that include political and business interests that support the fossil fuel industry.
The Paris Agreement has given South Africa a target of limiting global warming to 1.5 degrees celsius through reducing greenhouse emissions, but the slow pace of transition to renewable energy means the country is far behind this target.
The IISD report, Power by All: Alternatives to a Privately Owned Future For Renewable Energy in South Africa, explores new models for renewable energy and the implications of these for South Africa.
The report looks at four international case studies tackling renewable energy — Germany, Denmark, Morocco and the United Kingdom. For example, Ørsted, a state-owned power utility in Denmark, transitioned swiftly from a fossil fuel dependent operation to being a leader in renewable energy for that region.
According to Chido Muzondo, one of the authors of the study, the report is about finding alternatives to private renewables, as in the case of South Africa. She also suggests that certain policy shifts may help the country move faster.
“The new report shows that with the right business strategy and political support it is possible for state-owned Eskom to pivot our fossil fuels and dive into a more sustainable and cost effective renewable energy,” she said.
Eskom spokesperson Sikonati Mantshantsha says the company agrees with the IISD report — that it should be leading the transition to renewable energy.
“We do believe and are in fact on route to moving to renewable energy sources. We have about four coal-fired power stations that have almost reached the end of their life. Now, since last year, we have been asking for proposals from investors and other interested parties on what alternatives they would suggest must be built in these dilapidated coal power stations, be it laying solar or wind energy, which are renewable energy sources,” Mantshantsha said.
“Our aim is to have net zero emissions as Eskom by 2050; we want to significantly reduce our reliance on coal. However, we want to do this with the assistance of communities and investors, to balance social and economic sustainability,” he added.
According to Muzondo, the Denmark scenario could also be a good case study for South Africa
“In the Ørsted case study, the development of a small but capable business unit that developed a functional business model allowed the leadership to take the decision to transition the entire utility. This did not happen overnight and the context in South Africa is obviously different — but this could be the first step towards a transition to clean energy in South Africa,” she said.
“The Ørsted case shows that with support from the government and committed leadership, state-owned enterprise transition has the potential to transform the energy sector of a country and transition jobs from the fossil fuel industry to renewables.”
Eskom doesn’t need to be this big barrier to renewable energy, according to Muzondo, and this report has shown that.
“These ownership models have all been developed in an effort to balance the need for investment in renewable energy with the other economic and social needs of the community,” according to the report.
It states that although the energy scenario in South Africa is different to that of the other countries, the researchers believe that Eskom is the key enabler for renewable energy. “Without the widespread proliferation of renewable energy projects (in any business model format), it will be virtually impossible for the share of renewables to make up a great enough proportion of the country’s energy mix to account for the planned deficit of decommissioned coal plants and, moreover, to limit warming to below 1.5°C.”
Chris Gilili is an Adamela Trust climate and economic justice reporting fellow, funded by the Open Society Foundation for South Africa.