/ 2 April 2024

South Africa’s energy blueprint needs an overhaul

Eskom's Hendrina & Arnot Coal Powered Stations As Soot Pollution At 31 Year High
Pulling our leg: Last year, load-shedding went on for a record-breaking total of 335 days, making 2023 the worst year in South Africa’s blackout history. Yet, a matter of weeks before the elections Eskom has kept the lights on for more than a month, their best performance in two years. Photo: Waldo Swiegers/Getty Images

Industry experts and energy groups have called on the government and the department of mineral resources and energy (DMRE) to “go back to the drawing board” to overhaul the draft integrated resource plan (IRP 2023) or energy blueprint, as it fails to provide long-term energy solutions.

The IRP 2023, released last year by the DMRE for public comment, is the electricity infrastructure plan that looks at power demand and how it will be supplied.

However, energy analyst Tshepo Kgadima told the Mail & Guardian that the IRP 2023 has become irrelevant. 

This is because the government opened up the electricity market to allow independent power producers to contribute to the energy grid to compensate for electricity shortages. 

Kgadima argues that the deregulation and liberalisation in the electricity market meant that energy projects do not need the regulatory laws guided by the IRP document.

“Previously, a licence was required for power projects exceeding five megawatts, but now, plants up to 1 000MW can be built without one. This renders the predetermined terms of the IRP’s energy mix impractical from an engineering standpoint, as they fail to adapt to the market’s evolving dynamics,” he said.

Kgadima added that the IRP 2023 falls short when looking at solutions to the impact of the imminent gas shortages Sasol is expecting from 2026 and the continual closure of liquefied refineries.

He said it was concerning that the draft IRP 2023 did not prioritise energy security because it failed to provide plans to build importation terminals to deal with the imminent energy shortages including fuel and natural gas.

“It is therefore not surprising that by 2026 we will run out of methane-enriched gas. The IRP 2023 shows that the government did not sit down to think about the solutions needed to resolve the energy shortages. This will cause a ripple effect on all aspects of the country’s economic growth, causing everything to be expensive,” he said.

The draft IRP describes two horizons which explain how the government will stabilise the power system between now and 2030 as the first one and what kind of energy South Africa will need between 2030 and 2050 as the second horizon.

The draft also aims to make sure that South Africa has an affordable, secure energy supply and also moves away from coal-fired power stations at a rate that supports its energy needs.

Non-profit organisation Just Share’s climate change engagement director Robyn Hugo last week in a statement said the draft IRP 2023 had reached “erroneous conclusions and observations” because it included outdated technology costs that would be unaffordable for the country.

“The draft IRP falls far short of the minimum requirements for a credible and lawful electricity plan. It does not promote energy equity, provide energy security or pay meaningful regard to environmental sustainability,” she said.

Energy expert Adil Nchabeleng told the M&G that the IRP is unclear on funding the necessary grid upgrades and expansion, which is estimated to require around R390 billion. “While various options are being explored, the lack of clear solutions and timeframes is concerning,” he said. 

The country’s energy crisis has worsened existing economic challenges, prompting ratings agencies, the International Monetary Fund and the South African Reserve Bank to flag load-shedding as a significant barrier to economic recovery.

Kgadima said the IRP 2023 was out of touch because, despite its promises to leave no one behind, increases in electricity prices have been exorbitant recently.

The analyst said the failure to address concerns in the IRP document means that high-priced electricity that is unreliable will continue to contribute to unemployment, lost wages, petrol increases and the collapse of businesses.

Fuel is costly and these increases will be felt across the economy as the prices of food items and drinks will increase, Kgadima added.

The department of mineral resources and energy had not responded to questions at the time of publication.