/ 12 May 2022

A more nuanced energy conversation is needed

Six thousand megawatts more renewable energy to be built

A recent report by the International Institute for Sustainable Development, Gas Pressure: Exploring the case for gas-fired power in South Africa, and surrounding commentary, continues an unfortunate trend towards zero-sum thinking about the just energy transition and the development of renewable energy sources. 

The report is largely focused on why the layman’s category of “gas” is not warranted until 2035. In fact, the report analyses reliance on liquified natural gas (LNG) which is commonly used for gas-fired power generation. And it unfortunately does not deal with critically needed investment in liquified petroleum gas (LPG), often used in homes for cooking and heating. 

For a country in crisis, this lack of nuance could have catastrophic and unintended consequences. 

South Africa finds itself 14 years into an energy crisis that periodically sees rolling blackouts throughout the country for several hours a day. Any discussion of the cost of gas investment must also include an accounting of the cost of load-shedding, should we fail to leverage the utility of gas in mitigating this impact on the economy. 

With an estimated cost of more than R500 million per stage, per day of load-shedding and our ability to attract much-needed investment at stake, we should not be too quick to dismiss any resource that can mitigate these losses.

But “gas” is a very broad category. Not only does it include sources other than Liquid Natural Gas (LNG), notably Liquified Petroleum Gas (LPG), it must also be understood for its different types of uses . For bulk supply, short-term peak power and balancing or backup power. Both the differences in LNG and LPG and the potential uses of LPG especially, must be included in an informed conversation.

The report is correct to the extent that LNG will require significant investment in South Africa. There is no development of natural gas networks in South Africa beyond Gauteng, Mpumalanga and KwaZulu-Natal and the costs and complexity of transporting LNG are significant. By contrast, LPG is easily portable in its cylinders, ideal for reaching rural areas that are hard to electrify and for household use to cook and heat on demand. 

This is why LPG would be of immediate benefit to South Africa in reducing electricity usage during peak times when the grid is severely constrained. Moreover, with its higher energy content, LPG is far more efficient and most often cheaper than LNG. These differences are too frequently missed in discussions about “gas” and what it could mean for South Africa’s energy needs.

At its most fundamental, our energy crisis is caused by a failure in the delivery of bulk power supply due to poor maintenance of critical supply infrastructure and poor management of increased demand-side pressures. After years of promises and false declarations of an end to the crisis, the truth is that we don’t know how long this will go on.

 Reliance on renewable energy for all South Africa’s energy needs is indeed desirable, but it’s not realistic at this stage. Even a country like Germany with ambitious climate goals still relies on fossil fuels for more than 70% of its energy needs. 

Great strides are being made in renewables and battery storage technology, but the point at which renewable energy can fully replace fossil fuels is not yet in sight for most countries. With Eskom failing and renewables currently out of reach, we need an intermediate energy source to bridge the gap as part of a just transition urgently.

That renewable energy will need to be complemented by backup sources was underscored by the Texas Freeze in February 2021, when severe winter storms caused the worst energy infrastructure failure in that state’s history. A common but false narrative around that crisis is that it was caused solely by a failure of the wind turbines which froze in the extreme cold. In fact, natural gas operations failed too as a result of the storms. It is precisely these situations – sudden power outages not too different to loadshedding – that point to the utility of non-bulk, backup power sources like LPG. 

Another myth around renewable energy is also unravelling. Until recently, talk about the affordability of renewable energy has been growing as though renewable energy exists outside the global supply chain, removed from the vagaries of the market. The Russian invasion of Ukraine has brought the reality into stark relief. As it happens, both Russia and Ukraine are important suppliers of critical inputs for green technologies. Renewable energy has also suffered the price shocks caused by the Russia-Ukraine crisis.

This renewables price surge matters because it points to the necessity of having a backup power source should the build costs of renewables rise so steeply in the future that they are no longer affordable. As it is, the announcement of the opening of Bid Window 6 of the Renewable Energy Power Producer Procurement Programme (REI4P) has experts cautioning that this round  may underperform previous rounds owing to the increased costs and interest rates, plus higher inflation. 

None of this is an argument against renewable energy; it is instead an argument for pragmatism and a more nuanced discussion about the potential role of gas in South Africa’s future. Investment in gas is not a substitute for investment in renewable energy; but neither does the desirability of renewables nullify the need for gas. LPG can be a valuable complement to renewable energy. 

As a solution for quick deployment to shave off peak demand,  investment in LPG really cannot wait until 2035. With the cost of protracted load-shedding on the economy mounting and no end in sight, it needs to happen right now.

Monde Tyusha is the chief executive of Sunrise Energy, a liquefied petroleum gas import facility in Saldanha Bay operating under exclusive concession from the TNPA.

The views expressed are those of the author and do not necessarily reflect the official policy or position of the Mail & Guardian.