SA will see real change from Just Energy Transition Partnership
• The solid and actionable scheme will soon transition the country to a low-carbon economy
South Africans should start to see real economic change as a result of the country’s internationally ground-breaking $8.5bn Just Energy Transition Partnership (JETP).
During the world leaders summit at COP27 on November 7, President Cyril Ramaphosa launched the Just Energy Transition Investment Plan (JET-IP). This sets out in detail how SA proposes to use the $8.5bn the EU and several developed nations have pledged towards the country’s transition to a lowcarbon economy.
This is a moment of enormous opportunity, one that should be celebrated. The JET-IP has a real chance of boosting investor confidence in SA — and as we all know, with investment comes jobs.
That is good news in a country caught in a seemingly interminable quagmire that is commonly called our “triple challenge ”— the world’s highest rate of inequality, compounded by high levels of poverty and unemployment.
The JET-IP presents a solid and actionable scheme for transitioning SA to a low-carbon economy over the next five years, in line with our commitment under the UN Framework Convention on Climate Change’s 2015 Paris Agreement.
More than that, the plan ties in with work SA’s public and private sectors are already undertaking. This sends a clear signal that this should not be yet another document that gathers dust on official shelves.
The JET-IP sets out a R1.5trillion pathway to a greener future, in a practical, timebound, bottom-up guide that has built-in governance mechanisms that identify obstacles early so they can be ironed out.
The JET-IP itself is internationally significant as a first of its kind, and has caught the attention of other developing countries, several of which have approached SA to learn how they too can garner international support to achieve their own decarbonisation goals.
It is also remarkable as an example of the power of collective action in driving climate ambition and investment.
The power of collective action is something the National Business Initiative (NBI) strives to achieve across all of our work areas, including our work on the JET in SA. Our Just Transition Pathway’s work was developed alongside our partners, Business Unity SA and the Boston Consulting Group, with the aim of developing an analytical fact base to support decision-making and co-ordinate the efforts of key national and international stakeholders. This work was also shared with important actors, including government, to inform our country commitments to global climate efforts at COP26, in Glasgow during 2021.
This collective action boosted SA’s climate ambition, declared in the run-up to COP26 in a revised nationally determined contribution under the Paris Agreement, to restrict global warming to well below 2°C, compared with pre-industrial levels. This increased ambition caught the attention of the US, France, Germany, the UK and the EU, now SA’s JET-IP partners.
Together with our Just Transition Pathway project partners, the NBI also pinpointed three key sectors — renewable energy, electric vehicles and green hydrogen — that also form the backbone of the JET-IP. This is why the NBI confidently supports our country’s new practical blueprint for investing in a greener future.
In addition, we are confident that South Africans will start to reap the rewards of the JET-IP in what is a fairly short time: 18 months. The first step will be a solid answer to the energy crisis we all face, which will be a real boon to our economy.
It urgently requires an increase in SA’s grid capacity so that more energy from renewable resources can be fed into our severely anaemic system — something that cannot happen quickly enough.
South Africans — and particularly those living in Mpumalanga, where most of our major coal-fired power plants are situated — will also begin to see many more focused programmes aimed at ensuring individuals gain the skills they need to take part in this transition to a low-carbon economy, whether through upskilling or reskilling.
There can be no quibbling about the need for this transition: we must make it happen, and as quickly as possible. Without switching from an economy that emits high levels of greenhouse gases to a low-emissions economy, SA stands to lose out on business with some of its largest trading partners. By some estimates, up to 15% of GDP and 1-million direct jobs are at risk.
The EU and others will increasingly tax and restrict trade in goods produced in ways that emit large amounts of greenhouse gases, while China has pledged to stop financing coal beyond its borders. The Asian country has to do this to meet the pledges it has made to restrict climate change.
If SA is to reach greener pastures, we must as a country make this transition from a high- to a low-carbon economy. We must also do it as quickly as we can. Now we have a plan to lead us, so let’s get busy.
THE JET-IP IS SIGNIFICANT AS A FIRST OF ITS KIND, AND HAS CAUGHT THE ATTENTION OF OTHER DEVELOPING COUNTRIES