Just whistling in the wind

Business Day - - OPINION -

The ac­tion of work­ers in the en­ergy sec­tor to block the progress of re­new­able en­ergy gen­er­a­tion through protest or court ac­tion makes as much sense as print jour­nal­ists protest­ing against the ex­is­tence of the in­ter­net or fixed-line tele­coms em­ploy­ees want­ing to ban cell­phones.

Thanks to rapid tech­no­log­i­cal de­vel­op­ment over the past decade, re­new­able en­ergy is here. It is cheaper; it is cleaner; and con­sumers of the world pre­fer it.

There re­mains, of course, a need for a base-load en­ergy sup­ply for when the sun doesn’t shine or the wind doesn’t blow. In SA that is not very of­ten, but nonethe­less it is still the case that for rea­sons of eco­nomic ef­fi­ciency, a non-in­ter­mit­tent en­ergy sup­ply is re­quired. The op­tions here are coal, nu­clear en­ergy or gas and there has been much de­bate about which of these SA re­ally needs and in what pro­por­tions.

There will be more de­bate about this when the De­part­ment of En­ergy pub­lishes the In­te­grated Re­source Plan for which we have waited for five years. With luck, as the Zuma era comes to a close, a gen­uine de­bate can be held on SA’s en­ergy re­quire­ments, un­clouded by hid­den agen­das to force nu­clear en­ergy into the plan and con­strain re­new­able en­ergy.

The in­de­pen­dent power pro­duc­ers have been vic­tims of this dys­func­tional po­lit­i­cal agenda as Eskom has re­fused to sign the lat­est round of power-pur­chase agree­ments for the past two years.

But now, just as the log­jam looked to be bro­ken with a pledge by new En­ergy Min­is­ter Jeff Radebe to fa­cil­i­tate the sign­ing of the agree­ments, along comes more pol­i­tics with a court ap­pli­ca­tion by the Na­tional Union of Me­tal­work­ers of SA (Numsa) on Mon­day to block it. Numsa ar­gues that more re­new­able en­ergy will mean less coal-fired en­ergy, which will mean that its mem­bers will lose jobs.

The court has agreed to hear the ap­pli­ca­tion, which would in­ter­dict the sign­ing, at the end of March. Fail­ure for Numsa is likely in one re­spect and cer­tain in an­other.

In the first re­spect – that of the court ap­pli­ca­tion – the trade union is hardly likely to win. The com­mis­sion­ing of re­new­able en­ergy from in­de­pen­dent power pro­duc­ers is a cab­i­net-ap­proved pol­icy. Both the old In­te­grated Re­source Plan and the new one — stuck in the works for now, due to pol­i­tics — en­dorse the com­mis­sion­ing of re­new­able en­ergy. It is part of SA’s longterm en­ergy plan­ning and part of the strat­egy to meet car­bon emis­sions re­duc­tion tar­gets.

In the sec­ond re­spect — Numsa’s at­tempt to sup­press the growth of re­new­able en­ergy gen­er­a­tion — the union is doomed to fail. The cost of gen­er­at­ing en­ergy us­ing re­new­able sources has dropped dra­mat­i­cally. At the start of SA’s Re­new­able En­ergy In­de­pen­dent Power Pro­ducer Pro­cure­ment pro­gramme, the av­er­age port­fo­lio cost over the first-round bid was R2.52/kWh. In the fourth round — which is the one to be signed — the av­er­age cost had fallen to R0.82/kWh. It is es­ti­mated that the cost of pro­duc­ing en­ergy at one of Eskom’s new­est coal-fired power sta­tions, Medupi, is over R1/kWh.

Bloomberg New En­ergy Fi­nance projects that on cur­rent trends by 2040 one-third of the world’s en­ergy will be pro­duced by wind and so­lar; one-third of cars and light trucks will be elec­tric; and the world will be one-third more en­ergy ef­fi­cient.

These are un­stop­pable trends. A trade union such as Numsa would be bet­ter off seek­ing op­por­tu­ni­ties to re­cruit work­ers from these new in­dus­tries and look­ing for ways in which con­sumers and their mem­bers can ben­e­fit from a more com­pet­i­tive en­ergy sec­tor. In­stead, like Cosatu, which also is­sued a state­ment on Tues­day, it is tak­ing the di­nosaur ap­proach and call­ing for all re­new­able projects to be stopped and for any fur­ther lib­er­al­i­sa­tion of the elec­tric­ity mar­ket to be put on hold.

This is short-sighted and fu­tile. It is an an­noy­ing speed hump in the way of progress, but once passed will leave them be­hind.


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