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Nuclear and coal lobbies threaten to scupper renewables in South Africa

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The Conversation

South African power utility Eskom recently repeated that it will not conclude supply contracts with the developers of new renewable energy power stations. These developers were selected under a programme to facilitate private sector involvement in the building of medium-sized renewable energy power stations.

Public Enterprises Minister Lynne Brown citing cost as a reason to stop the last phase of renewables.

Public Enterprises Minister Lynne Brown citing cost as a reason to stop the last phase of renewables. Image provided by The Conversation

The programme has won plaudits for its success in facilitating the establishment of multiple solar and wind farms in record time. But Eskom is once again stalling.

The power utility’s stand threatens the viability of the entire renewable energy sector in the country. It’s hostility also defies logic given that the whole world is embracing renewable energy as key to a clean energy future and combating climate change.

So what lies behind the opposition?

The answer lies in the fact that two powerful lobbies are at work in South Africa. One is pro-coal, the other pro-nuclear. This has made the success of the renewable energy projects a target for attacks from interested parties in both.

Disrupting the renewable energy sector would ensure that the coal sector remains dominant. And that, over time, it is gradually displaced by nuclear.

The lobby groups attached to coal and nuclear appear to have had powerful allies on the state utility’s board. There is mounting evidence that they have been furthering the interests of a group linked to the Gupta family. It in turn has been accused of capturing state entities to further its own ends, as well as those of President Jacob Zuma, his family and allies.

It has also been widely argued that the massively expensive proposed nuclear build is being driven by the same interest groups.

The battle over renewables is therefore closely linked to a wider political confrontation over control of key aspects of the South African economy.

Eskom’s flawed argument

The renewables dispute centres on the state utility’s refusal to endorse 1121 MW of new renewable energy. This translates to about 1% of Eskom’s current generated electricity, given that renewable energy supply is intermittent. This additional renewable energy would make up 5% of the total renewable energy generating capacity projected by 2030.

Eskom accepts the need to expand its generating potential in the long term. The additional contribution from renewables is well within its broader expansion targets. And tariffs on the energy from renewable sources would be almost half of the estimated cost of new coal and new nuclear power.

The Public Enterprises Minister Lynne Brown has been disingenuous in citing cost as a reason to stop the last phase of renewables. The higher costs she recently quoted were presumably those associated with the first round of renewable energy projects. These contracts were concluded in 2012 and prices for renewables have come down considerably since.

For its part Eskom has pointed to the oversupply of electricity as the reason for its objection. But elsewhere it has trumpeted the need for more nuclear power. It can’t have it both ways.

Powerful forces at play

Until two years ago Eskom was seen as a neutral player committed to effectively provide electric power in the best interests of the country. It threw its weight behind previous power procurement plans.

But that all changed in 2015 after Brian Molefe was appointed CEO.

Molefe and his successor Matshela Koko are both linked to the controversial Gupta family. Their names featured in the Public Protector’s State of Capture report as well as in a bulk leak of emails which implicated the Guptas and other leading figures in the state capture network.

Molefe and Koko played a pivotal role in helping the Guptas purchase a coal mine – the Optimum mine – and to secure a lucrative coal supply contract with Eskom. Both are also strongly pro-nuclear. They have also gone on record to argue that renewable energy is too expensive.

Eskom has furthermore listed renewables as the reason for planning to shut down four coal power plants. In reality, these old plants had already been destined for closure in anticipation of the imminent additional power supply expected from two new coal plants – Medupi and Kusile.

It’s suspicious that one of the power stations facing closure, Hendrina, is supplied by coal from the Optimum mine. The effect of stalling renewable power expansion could force the extension of Hendrina’s life span.

Brown is in the process of restructuring the Eskom board after Molefe departed, Koko was suspended and the chairperson of the board resigned. Although there are signs that the minister is aware that she has been misled by the Eskom board on other matters, she doesn’t seem to believe this is true when it comes to renewables, repeating recently the view that it’s too expensive.

Brown’s counterpart in the energy portfolio, Nkhensani Kubayi, has displayed little sympathy for the renewable energy sector, also making far-fetched and easily disprovable claims that the initial solar and wind power stations have resulted in zero jobs. Renewable energy is in fact estimated to eventually generate over 100 000 jobs in South Africa.

Kubayi has also shown that she’s highly receptive to the nuclear lobby. Visiting a nuclear industry fair in Russia in the middle of June she expressed concern that the judicial disqualification of the existing nuclear cooperation agreement damaged relations with that country.

It has been convincingly argued that South Africa can’t afford the nuclear option in the current economic environment.

The immediate future

The global ascendancy of renewables and their particular pertinence in South African climatic conditions may even make coal and nuclear energy technologies obsolete in the distant future. Ultimately South Africa won’t be able to buck international trends. That means that, in the longer term, the future of renewables in South Africa remains bright.

Source: The Conversation. Reproduced with permission.  

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  • George Darroch

    What a mess.

  • solarguy

    Lyn Brown has obviously been paid off!

    • MaxG

      Or is stupid… or both…

  • Chris Fraser

    Renewables’ problem is that it is too good, too disruptive. It is another epochal struggle between the old and the new. It is correct to note that domestic nuclear energy will struggle for the very long term. Anyone who forgets to invest in renewables now, has only one objective left to them. That is, to reduce the total generation of energy so they might exert more control over the wholesale price. Poor South Africa we wish you well.

  • john

    So they are going to invest in nuclear, or perhaps one should call it not clear, yes not clear why on earth would one ever invest in the most expensive base line power imaginable even coal beats it.
    As to why they wish to curtail solar that is simple it reduces the outcome for the incumbents let alone any other would be power generator builders.
    South Africa should be investing in Solar, Wind and CST as their resources suit those resources.
    To see a country make such poor governance decisions is not exactly going to work out well in the long run.
    As a comparison look at Chile who are embracing solar and CST perhaps the government ministers need to get better advisers, who have just a tiny little bit more worldly experience than they are told by the present incumbents.

    • Joe

      Yes, Chile are going gang busters will all things Solar related. They have progressed from the basic solar farm to CST and Solar combined with pumped hydro….it is all happening as the saying goes! Chile and Australia are amongst the sunniest countries in the world but it is Chile that is Leading the way projects to do with Solar. It really is exciting to see Chile get on with it.

  • Joe

    Do I detect a hint of corruption at play here? I am no expert on African or South African politk but ‘corruption’ seems to be an industry all on its own and damn hard to breakup.
    Politics and an established interest that is under threat always makes for an interesting double act to push back against a new entrant. I mean we have this scenario of sorts playing out here in Australia, yes.

  • MaxG

    There is this German saying: Von den Dummen lebt die Welt”… in in English it might be: ‘The world lives off the silly’ … I think you get my drift… 🙂

    • nakedChimp

      There is another one that fit’s better – “Wess’ Brot is ess’, dess’ Lied ich sing”
      😉

  • Caroline4

    From Jacob Zuma down, over the past decade South Africa’s government institutions have been captured by the corrupt and mega-rich Gupta family. It is a tragic situation that has developed in what could have been the most enlightened, progressive amazing place building on Mandela’s legacy. Heart breaking.

  • Mark Roest

    Australia is the lesson in point here, and South Africa may be a good place for it to play out. The federal government puts coal ties ahead of people and nature in both cases, because of the wealth that can be created for the elite through centralized ownership and control of energy, which is crucial to the operation of the economy — i.e. to the lives of everyone. This is colonialism’s core precept: gain monopoly control over critical or highly valued (spices) resources, divide and conquer the people so they cannot fight back, and jack up the prices so the elite can drive Rolls Royces, have million-acre estates, and keep convincing themselves that they are superior to everyone else, while having the power to step on others’ heads to convince others that they are inferior and that’s the reason why they can be exploited at will.
    Riane Eisler calls this the Dominator Paradigm; she calls for it to be replaced by renewed ascendancy of the Partnership Paradigm in her book of that name, and gives a fascinating history of how the Dominator Paradigm took over globally in The Chalice and The Blade.

    Jesus, Muhammad, Buddha, and many other great spiritual teachers were all pointing out that our dominator nature causes needless suffering to all, and our stewardship, partnership, nurturing, loving, contemplative, appreciative, spiritual nature creates happiness for all. In that sense (and others), all the major religions are branches of the same tree.

    If you read Jane Goodall’s later book(s?) you will see that the chimpanzees, with whom we have common ancestors, treat each other very nicely within their family group, but attack and kill members of other groups to gain control over choice foods and females. The troupe that Jane studied split, 5 of 12 took an adjoining territory, and the males among the 7 remaining killed each of the 5 in ambushes over the next 18 months; they committed deliberate genocide, just like the Klan / fascists want to in the USA.

    The emotional process is called de-speciating, and class and caste systems are an expression of it. The fundamental driver is greed. Most of our political leadership systems, at the top levels of hierarchies, are about creating loyalty to support greed; when we break through the logjams to treat each other well, to nurture each other, and let the young know success on that path, the greed paradigm can collapse.