Eskom said they’d shut down five old coal plants this year. They blamed the need to switch to renewable energy, even though the coal plants are just getting worn out.
Even though some disagreed with Eskom’s explanation, their decision to retire coal plants shows that coal’s reign as the main source of power is weakening. Disagreement stemmed from the fact that new coal plants are expensive compared to other options.
Coal is currently king, supplying most of Eskom’s power (around 83%). But the fight is on to decide what energy sources will take over to keep the electricity flowing in the future.
Coal power is on the decline because it’s getting harder to justify. It’s getting more expensive to run coal plants, they struggle to meet stricter environmental rules, and other ways of generating electricity are becoming more advanced.
Eskom struggled to meet air pollution limits in 2014. They asked for and received extensions for 16 of their power plants. It seems they’ll need more time for at least two plants to comply with the regulations.
Eskom explained they’re following a gradual plan to cut emissions because upgrading their aging facilities is very expensive. They’ve already invested over R107 billion towards this goal.
This year, coal suffered another setback. A South African court ruled that environmental officials must consider the impact on climate change before approving a new coal plant (Thabametsi Power Project) in Limpopo province.
An energy policy researcher for Earthlife Africa Johannesburg, Richard Worthington, stated that Eskom is trying to alter the story of coal’s fate and renewables’s costs.
According to Worthington, Eskom is exaggerating the benefits of nuclear power to justify a large contract that would enrich its executives, potentially at the company’s expense.
In order to achieve its goals under the Paris Agreement, which aims to limit global warming to 1.5 degrees Celsius, the country must reduce its reliance on coal, according to Worthington and others.
South Africa has a plan to reduce greenhouse gas emissions that gradually reaches a peak, stays level for a while, and then goes down. They aim to keep emissions between 398 and 614 million metric tons of carbon dioxide equivalent by 2025 and 2030.
South Africa’s roadmap for achieving its energy objectives was laid out by the Department of Energy in November 2016. This plan, called the Integrated Resource Plan (IRP), outlines models for the country’s future energy mix.
The Integrated Resource Plan (IRP) sparked debate due to its emphasis on nuclear power, limitations placed on renewable energy sources, and concerns about the data used in its creation.
The Council for Scientific and Industrial Research (CSIR) disagreed with the IRP’s limitations on renewable energy. In January, they presented their own analysis showing that a future reliant on renewables is the most economical option. They argued that the IRP’s cap on renewables simply doesn’t make financial or technological sense.
The government’s official energy plan (IRP) has a low target for renewable energy, aiming for just 23% to 29% of the country’s electricity to come from wind and solar power by 2050. In contrast, the CSIR’s analysis suggests a more cost-effective approach with renewables playing a major role. Their model calls for a significant shift away from coal and for 79% of the country’s electricity to be generated by wind and solar by 2050.
The coal industry supplying South Africa’s power plants is facing a double challenge. Eskom, the main electricity provider, is changing how it buys coal and wants a bigger role for black-owned companies. This is making the industry less appealing for big players, with Anglo American, a major coal producer, deciding to sell its mines that supply Eskom.
Jesse Burton, another energy policy researcher but, for the University of Cape Town’s Energy Research Center, expressed that drifting away from coal dependency does not have to include economic hardships.
Burton believes Eskom’s dominance in the electricity market is weakening. This means that people might soon be able to choose cheaper providers for their power.
Eskom has invested a huge amount of money in building Medupi and Kusile power stations, and these projects are still ongoing.
According to Burton, building large coal mines specifically for inefficient power plants like Kusile could be a risky investment. These mines might become worthless if Kusile can’t produce electricity cheaply enough to be competitive in the market
The government agency responsible for energy planning, Department of Energy has remained silent despite efforts to get their perspective on the IRP and the future plans of electricity production.
The IRP suggests a shift away from coal and towards nuclear power as a cleaner way to generate electricity.
South Africa’s plan to buy nuclear power plants from Russia, South Korea, and the US was blocked by a court ruling. Despite this setback, the government remains committed to including nuclear energy in their future electricity generation strategy.
There are serious concerns about corruption if the government moves forward with a new nuclear program, especially considering the high cost estimate of around 1 trillion Rand.
Data from Oxpeckers’ #MineAlert platform shows that South Africa has roughly 130 mines currently extracting uranium, the fuel needed for nuclear power stations.
The Gupta family, who own a uranium mine called Shiva Uranium through their company Oakbay Resources and Energy Limited. This raises concerns that their business interests might be unfairly influencing the government’s decision to pursue nuclear power.
When Oakbay listed Shiva Uranium on the Johannesburg Stock Exchange in November 2014, a press release boasted that the mine would access one of the world’s top five largest uranium deposits.
Even though the Gupta family owns a uranium mine, experts warn against assuming this directly influences the government’s nuclear ambitions. There are two reasons for this caution. First, raw uranium ore needs to be shipped overseas for processing before it can be used in power plants. Second, building new nuclear facilities will take years.
Burton clarified that the situation is more nuanced. While the Guptas owning an apparently unproductive uranium mine is concerning, it’s not the same as that uranium being used to fuel a power plant, which would have a bigger impact.
According to experts, the contracts involved in building a new nuclear plant would be highly vulnerable to corruption.
An energy expert, Worthington, criticizes the plan (IRP) for prioritizing a nuclear program that isn’t based on actual electricity needs. He argues the plan is driven by political interests, not by what’s best for the energy system. In his view, nuclear procurement has never been about energy planning.
As early as last September, there were reports that a company linked to a friend of the president’s family won contracts for the nuclear project.
Burton raised concerns that people with political connections are already profiting from contracts linked to the nuclear program.
There’s controversy at Eskom. The CEO, Brian Molefe, quit after being linked to corruption in a government report. But surprisingly, he just got his job back! Meanwhile, another Eskom executive, Matshela Koko, is accused of giving business deals to a company connected to his family.
Eskom assures the public that any new nuclear power plants will be chosen through a fair and open bidding process that considers both price and fairness.
Eskom’s troubles go beyond just leadership issues. An internal investigation, called the “Dentons Report,” revealed several problems. These included rising coal prices and a concerning trend of Eskom bypassing fair competition when awarding contracts.
Eskom claims the Dentons Report didn’t uncover anything surprising. The company says the report confirms what they already knew about the problems they need to fix. It also reported that the “majority of the recommendations” had been carried out by November 2016.
The government is trying again to allow fracking in the Karoo, even though local communities are strongly opposed to it.
In a prepared speech, Minister Mosebenzi Zwane announced the government’s renewed push for fracking. He explained that this is part of a plan to reduce South Africa’s dependence on coal for electricity.
Minister Zwane defended fracking as a way to achieve several goals for South Africa’s energy sector. He said it would lower energy costs, improve energy security, and reduce greenhouse gas emissions. However, his claim about fracking being a clean alternative to coal is debatable, as some believe methane released during fracking and natural gas use can have a significant climate impact.
South Africa’s oil and gas agency is considering applications for fracking licenses in the Karoo desert. Big companies like Shell, Falcon Oil, and Bundu Gas are all interested. Environmental concerns have slowed things down, but licenses could be approved by September.
Some experts believe natural gas can be a temporary solution as South Africa moves away from coal and towards renewable energy sources. However, there are doubts about whether fracking will actually produce enough gas to make a difference. An additional concern is that companies wouldn’t be forced to sell the gas at a fair price, making imported gas a possible alternative
Minister Zwane defended the government’s fracking decision by claiming it’s backed by the best available scientific evidence.
A long-awaited, in-depth report on fracking was released in November after over a year of research. However, the report’s conclusions seem to contradict Minister Zwane’s claims about fracking.
Minister Zwane hyped the potential of fracking by claiming there’s a massive amount of recoverable gas. However, the actual numbers tell a different story. While a US estimate suggested a huge amount (485 trillion cubic feet), a more recent scientific assessment found a much smaller range (between 5 and 20 trillion cubic feet), with Zwane himself admitting a lower figure (50 trillion cubic feet). This raises questions about the true potential of fracking in South Africa.
Interest in fracking in South Africa is fading as companies abandon their investments due to shrinking estimates of recoverable gas reserves.
Even if a significant amount of gas (20 trillion cubic feet) were discovered, fracking would raise environmental concerns. The study estimates the industry would use a vast amount of water (65.5 million cubic meters) and require millions of truck trips (2 million) through the fragile Karoo ecosystem. Additionally, it would involve building thousands of production wells (4,100).
The report acknowledged that fracking could create economic benefits, similar to other mining operations. However, it also warned of potential economic risks associated with this extractive industry.
Even if fracking gets the go-ahead with new licenses, the report suggests it wouldn’t be a quick solution. Production wouldn’t start for at least another 11 years. Interestingly, the study predicts that renewable energy sources have the potential to become a bigger economic driver for the region in the long run, even without fracking.
An expert, Burton, looks down on the idea of fracking success in South Africa. He points out that it will likely be a long time before fracking even begins, and political instability discourages investors. In other words, they don’t see fracking as a reliable investment in South Africa.
Despite repeated requests for comment, the Department of Mineral Resources has remained silent on its efforts to promote the practice of fracking.
Worthington criticizes the government’s energy plan (IRP) for limiting renewable energy sources. He believes South Africa has plenty of wind and sunshine to meet its electricity needs. In fact, he co-authored a report called “Plan A” that highlights this abundance of renewable energy.
Backing up Worthington’s point, South Africa’s Council for Scientific and Industrial Research also analyzed the IRP. Their report suggests a future heavily reliant on renewables could be significantly cheaper. They estimate this high-renewables approach would save 90 billion Rand per year on electricity generation compared to the current IRP by 2050.
Renewable energy sources aren’t without drawbacks. One challenge is intermittency – they can’t always produce electricity when it’s needed, like on cloudy days or calm nights. Another concern is the cost of upgrading the power grid to handle these variable sources.
Burton, argues that the challenges of using renewable energy sources, like relying on wind or sun which aren’t always available, can be addressed. He downplays these concerns, suggesting the coal and nuclear industries exaggerate the difficulties of renewables in order to promote their own interests.
Generating electricity from renewable energy sources proposed by independent companies is significantly cheaper than using coal. In fact, bids for these renewable projects are about 40% lower than those for coal-fired power plants.
Eskom expressed support for the government’s program that encourages independent companies to develop renewable energy sources. They’ve already signed agreements to purchase electricity from 64 such projects, generating a total of 4,000 megawatts. Additionally, Eskom plans to secure even more renewable energy by signing contracts for another 2,383 megawatts in the near future.
The planned closure of five coal-fired power plants caused alarm among coal workers. Fearful for their jobs, truck drivers who haul coal staged protests against the decision.
People who support renewable energy argue that switching to these sources won’t just be good for the environment, it can also create new jobs. For instance, a study in the US showed that solar and wind farms are creating new jobs at a much faster rate than the rest of the economy – 12 times faster.
An expert, Worthington, proposes a clear path forward for South Africa’s energy future. He argues against building any new coal or nuclear power plants, suggesting that focusing on renewables is a more cost-effective and sustainable solution.