SA is still in the dark on status of energy plan
• Minister says Cabinet has approved an updated IRP — but questions remain unanswered and anxieties multiply
At the end of 2017 there were strong indications from the minister of energy about the finalisation of a very important planning document. Around the country an audience took its seat, a drum roll started and the MC said the actors were on stage. But the curtain never lifted and the audience is still waiting and wondering what is going on behind the scenes.
The document is the Integrated Resource Plan (IRP), which determines what electricity infrastructure will be built and when and whether or not SA will move towards a sustainable, equitable and affordable energy future.
It not only affects the government’s environment and climate change commitments but it will directly affect citizens’ wallets.
For the middle class, unnecessarily high electricity prices will be an annoyance, but for millions of low-income households it will determine how many days a month they can pay for lighting.
Very soon after David Mahlobo took office as the third minister of energy in 2017, there was talk of fast-tracking the new IRP “with immediate effect”. The current IRP is from 2010. The seemingly endless process of updating it has been dragging on for more than seven years. There was suspicion that this was a last-ditch attempt by the Zuma administration to seal a new nuclear-build programme before the ANC’s national conference in December 2017.
If more nuclear power plants are to be built in SA, they would need to be in the updated plan.
The inconvenient fact for people with a nuclear agenda is that internationally the full lifecycle costs for producing nuclear power have risen 35% in real terms since the IRP 2010 was drafted. Alternative, lowcarbon electricity sources such as solar photovoltaics (PVs) have decreased in cost by 83% over the same time period. At almost a sixth of the price in 2010, solar PV is now a third of the price of nuclear, a report from financial firm Lazard reads.
Unsurprisingly, all the recent modellings done by respected local and international institutions have indicated that new nuclear capacity is not part of a least-cost energy mix for SA in the future.
The latest work on the IRP by Eskom, which was pushing so hard for nuclear when Brian Molefe and Matshela Koko were at the helm, indicates nuclear is not required. It has been reported that Mahlobo subsequently took the draft plan back from Eskom so that his team of nuclear enthusiasts could put it through “policy adjustment”.
Due to all the fundamental changes in the energy landscape since 2010, the only way to have nuclear as part of an electricity generation plan for the future is to force it in.
Late in November, less than a month before the ANC conference, Mahlobo announced that there was to be an Energy Indaba. It was billed as pubic participation on national energy choices and the role of nuclear, but it was an invite-only event that excluded many civil society and labour representatives. Mahlobo later indicated that the indaba was definitely not about consultation related to the plan.
On December 7 2017, the first day of the indaba, Mahlobo made a grand announcement that the Cabinet had approved the long-awaited plan the night before. But it had not, at least not according to the official cabinet notes. So what is the status of the new IRP?
THE PROCESS OF PUBLIC PARTICIPATION TO UPDATE THE IRP IS FUNDAMENTALLY FLAWED
It is two months after the announcement, and SA still does not know.
Even more worrying was that Mahlobo described the new plan at the indaba as essentially the IRP 2010 but with decreased allocations across the board to all energy sources (due to lower electricity demand and economic stagnation).
Given the enormous changes in the energy landscape in the past seven years, particularly the large reduction in renewable energy prices, this is simply untenable. A possible explanation is that a scaled-down IRP 2010 will include nuclear, and since all objective new modelling excludes nuclear, it would be one way to force it into the plan. This is just conjecture, which is why the Cabinet should provide straight answers.
Mahlobo’s new IRP process essentially ignores the valuable input made at public hearings between December 2016 and February 2017. A year later, the presentations made are available on the Department of Energy website, but for transparent planning all the written submissions should also be made available.
Using the limited information available, Energy Governance SA, a network of more than 60 organisations and individuals committed to good governance in the energy sector, conducted an analysis of all 54 presentations available on the department’s website.
Their two key concerns are that the cost assumptions are inaccurate or out of date and that the model must select a leastcost option as a base case without constraining any particular technology. These two points were made in 63% and 48% of presentations, respectively.
Considering only the 27 presentations that gave a general critique on the methodology, base case or assumptions, rather than those representing or promoting a particular technology, these percentages increase to 85% and 74%, respectively.
These two key concerns alone would rule out a new IRP that is structured as indicated by Mahlobo at the Energy Indaba.
The best electricity infrastructure plan for SA from 2018 is not a downsized version of the IRP 2010, which is no longer fit for purpose.
Regardless of the true nature of the document that the Cabinet is purported to have approved, the process of public participation to update the IRP is fundamentally flawed.
What was presented at the end of 2016 was called a “base case” and the then minister of energy, Tina Joemat-Pettersson, made it clear that the document was just a “starting point” and not the final draft.
Joemat-Pettersson said that the process had four milestones: “setting the key assumptions; developing a base case; modelling and analysing the scenarios; and developing the final plan taking into account the various scenarios and policy positions”.
There has been no indication that there will be any further rounds of public input. Mahlobo specifically stated at the indaba that the new plan would be published without further public consultation. If this is true, then it means that the public are excluded from the most critical part of the process, the finalisation of the plan.
There is also no requirement for the Department of Energy to show how public comments were incorporated or omitted, and to justify their choices. The final draft could be entirely different from the base case and, if approved by the Cabinet, SA would be stuck with it. This is not good governance.
Citizens therefore urgently need to know what happened to the updated IRP in the Cabinet on December 6 and what its status is now. The department must provide evidence on how public concerns to date have been taken into account and what opportunity there will be to have input on the final draft.
The IRP is a plan for the people. It should be rational and it should be developed in a truly participatory manner.
It must benefit the majority of South Africans, not just a few individuals or industries.