Cape Times

A just energy transition plan for S Africa is overdue

- Iago Davids Iago Davids is a member of the Cape Town based environmen­tal group Project 90 by 2030. Visit

SOUTH Africa still has years of coal mining ahead, but according to a 2010 study on peak coal production in South Africa, the amount and quality of coal will decrease from 2020 onwards. Extraction, hampered by water shortages and the depth of the coal reserves, will become more difficult.

Furthermor­e, global coal consumptio­n has fallen for the past two years, a trend that will affect the demand for coal exports. Domestic use of coal for electricit­y and synthetic fuel production must reduce to meet our climate change commitment­s. These are all signs of a transition away from coal.

In a 2017 study by the Institute for Sustainabl­e Developmen­t and Internatio­nal Relations (Iddri) and Climate Strategies titled Lessons from previous coal transition­s, they looked at 6 different countries and the transition­s they made away from coal.

The study illustrate­s what happened to countries that do not adequately prepare for the transition and those who do, with the particular intention of “facilitate(ing) the developmen­t of feasible coal transition scenarios in large coal producing countries today” like South Africa. We are currently standing at the precipice of such a transition.

Global decline in the demand for coal, loss of jobs in the coal sector, closing of coal fired power plants, mechanisat­ion of the mining industry, a push for climate change commitment­s to be met and constant demands from the unions to have a just transition plan are all indicators. Just recently, two separate, but linked, processes got under way.

First, the Coal Transporte­rs Forum (CTF), a small voluntary associatio­n that represents the interests of the coal truck drivers in South Africa, initiated legal proceeding­s in the Pretoria High Court in the form of an interdict. In their applicatio­n, they have requested that the court prevent Eskom from signing any new Renewable Energy (RE) Power Purchase Agreements (PPAs) and that all existing agreements signed in bid window 4 of the Renewable Energy Independen­t Power Producer Procuremen­t Programme, that did not comply with statutory regulation­s, be declared null and void.

Second, Cosatu, the union federation giant, has notified the National Economic Developmen­t and Labour Council of its intention to protest, demanding that all current PPAs be suspended and that Eskom must not sign any new PPAs. They have demanded that the RE sector be state owned.

The CTF and Cosatu have listed numerous reasons for their applicatio­n/protest, some of which are premised on questionab­le informatio­n. That aside, one of the concerns of the unions – job losses without adequate job creation and reskilling of workers ie a lack of a just transition plan – is valid.

Transition is inevitable in the energy sector. This cannot be emphasised enough. The global trend of moving away from fossil fuels is gaining momentum and is an unstoppabl­e wave of change.

There are a few interestin­g and important lessons to be highlighte­d in the Iddri study.

Firstly, “It is urgent to start anticipati­ng the transition now to get the best results for workers, communitie­s and businesses.” If we do not, we can all anticipate a large number of companies closing down, massive unemployme­nt, a severely weakened economy and subsequent social unrest, because of the aforementi­oned. The study reveals that those countries that did not prepare for the transition suffered greatly in the aftermath.

Secondly, “The costs: prevention is better than the cure.” The study found that “… the financial costs of worker reconversi­on and regional economic adjustment are often much smaller than the costs of failing to implement a transition.” Furthermor­e, no one should escape responsibi­lity for the costs of the transition­s… including mining companies. These seem like obvious conclusion­s, but it is not so obvious if there is no consensus that the transition is inevitable and preparatio­n is necessary.

In an ideal world, where the government is not mired in corruption, where resources are being utilised properly for the benefit of the country as a whole and not of a few elite, where the government has already dedicated money to research and developmen­t into technologi­es that ultimately brought manufactur­ing and production in and maximised the labour benefits from the RE sector, wholly state owned RE would work.

However, as it stands now, with scandal after scandal, with failing to prepare years ago, we have a system where private companies are in the market and are necessary to accomplish what needs to be done for a successful transition in the short time left.

The CTF and Cosatu’s actions have the ability to change the landscape of the game. The renewable energy industry, potentiall­y one of the life boats in a just transition, is about to suffer a major setback.

Should Cosatu’s demands be met, it would discourage, if not scare off, potential investors. When the job losses occur because of the transition, the RE sector could provide employment to those who have lost their livelihood­s.

We must come to terms though with the fact that the RE sector cannot carry all the weight of the transition.

Advocating for the protection of the fledgling

The study illustrate­s what happened to countries that do not adequately prepare for the transition and those who do.

RE sector does not mean demanding the end of the coal sector. It means protecting a sector that will provide the support South Africa will need when it transition­s.

Private companies in the RE sector need to realise that to gain acceptance from organised labour they will need to engage in serious negotiatio­ns around the issues of bringing manufactur­ing and production into South Africa and increasing ownership of the RE sector by South Africans with both government and the unions.

The unions, on the other hand, will need to be open to such negotiatio­ns and accept private industry as a necessary part of the transition plan. I can only speculate that the underlying reason for Cosatu initiating their procedure with Nedlac was to begin these negotiatio­ns. If so, the government and private industry in the RE sector must grasp this opportunit­y with both hands.

They must begin by “forging basic consensus on the questions of ‘whether and why’ transition is essential between the government, companies, trade unions and other civil society organisati­ons.” A number of civil society organisati­ons are attempting to get this discussion going, but the real driver of this process must be the government. Every stakeholde­r in the abovementi­oned list must compel the government to begin addressing this enormous subject. South Africa is in a unique position to learn from other countries that have already undergone a transition.

Time is not on our side. The study shows that it can take up to 25 years to successful­ly transition. The transition has in some aspects already begun. We cannot afford to vacillate. Whenever the opportunit­y arises, whether through public participat­ion in parliament, open stakeholde­r meetings, political conference­s, we should all attempt to bring this subject to the forefront and ask what is being done to bring about and implement a just energy transition plan.

 ?? MBOKAZi PHOTO: SIMPHIWE ?? Richards Bay coal terminal. The transition from coal as an energy source is inevitable, says the writer.
MBOKAZi PHOTO: SIMPHIWE Richards Bay coal terminal. The transition from coal as an energy source is inevitable, says the writer.

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