The future of energy in South Africa

The CSIR recently delivered a presentation to the Portfolio Committee on energy and mineral resources that outlines how South Africa should transition its energy production over the next 30 years.

Dr Clinton Carter-Brown, Head of the CSIR Energy Centre, said that coal needs to remain part of South Africa’s energy production well past 2050 – albeit as less than 20% of total energy production.

He added that South Africa will probably only begin to reduce its coal usage from 2030 onward.

“This decline would be linked to the decommissioning of aging coal fired power stations,” he said.

He expressed concern at the current coal-dominated system, however, which faces a variety of major challenges – including aging power stations, dependence on imported resources, and a growing infrastructure backlog.

This has resulted in load-shedding, higher electricity prices, and weaker investor confidence in Eskom, said Carter-Brown.

Going green

Carter-Brown believes that the future of South Africa could comprise a “healthy mix” of energy sources, including solar, wind, hydro, natural gas, and biomass.

He said that South Africa is in a good position to play a significant role in the world’s transition to renewable resources because of its access to important, low-cost resources.

“The South African energy transition will be gradual, and coordinated planning is required to carefully manage the impacts whilst maximising the benefits,” he said

Carter-Brown added that South Africa could export some of its resources to other countries, which add a new revenue stream as well as more jobs to the South African economy.

“Opportunities for new industries abound, however, the transition to these new industries, which are aligned with the fourth industrial revolution, will require new skills, and research and capacity building will be key,” he said.

Solving Eskom’s infrastructure problems

A leaked Eskom vision and strategy document also shows that Eskom has a plan it hopes will help solve its well-documented issues.

Acting CEO Jabu Mabuza has admitted that Eskom is in a “death spiral” and its current business model is unsustainable. It is for this reason that he presented a new plan to the Eskom Executive Forum on 22 August.

The first step of this plan was originally announced by President Cyril Ramaphosa in February.

Ramaphosa said that the generation, transmission, and distribution activities of Eskom will be split into three separate subsidiaries.

The next step will see the transmission company be excluded from Eskom completely, and instead instated as its own state-owned company under the Department of Public Enterprises.

Step three involves creating a competitive generation sector that comprises a variety of public and private entities.

Finally, distribution would be restructured into independent, state-owned, regional electricity distributors.

Now read: Why Eskom’s debt is a great bet for investors

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The future of energy in South Africa