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Is SA running out of energy?

According to the World Economic Forum (WEF) South Africa is trailing the global race towards sustainable energy sources.

SA ranked 113th out of 114 countries in the Effective Energy Transitions Index 2018, according to a report by the WEF.

The report noted that “South Africa faces an uphill challenge in ensuring a secure, sustainable, reliable and affordable energy future for industry and society.”

Environmental law professor Jan Glasewski and specialist Olivia Rumble comment on SA's current and future energy requirements.

Global energy trends

“The rate of investment in fossil fuels, in particular and coal fired power stations has declined significantly.”

This is due, in part, to the increased cost competitiveness of lower emission technologies, such as solar and wind according to the experts.

“There has also been a decline in oil and gas in the last few years on the back of the collapse in the global oil price.  In turn, we have seen an upswing in investments in energy efficiency measures and programmes, and renewables have claimed the largest share of electricity investment internationally.”

A step behind the curve

Despite this global shift away from coal use SA's current energy policies reflect an “over-dependence on coal for more than 90% of the energy supply mix”.

To counteract this problem SA would need to diversify its fuel mix and create an environment that would attract greater investment. “Another imperative is to allow for more flexibility in the electricity sector.”

Changing policy

So what's stopping the country from moving toward alternative energy sources?

"The policy for energy supply is primarily dictated by the Integrated Resource Plan (IRP). This plan has not been updated for many years although a  draft update is under discussion.”

The IRP directs much of South Africa's future energy mix and related investments in the sector. “It is imperative that it is updated and based on reliable, independent and up to date information and modelling.”

An amended version is expected to be released in 2018.

The future of energy

Experts agree that South Africa’s energy system will look very different in 20 years. The prediction is that coal will contribute much less to primary energy needs and will be replaced by gas and renewable energy resources, especially wind, solar and imported hydroelectricity.

“Energy-efficient options will be widely available and increasingly adopted. The country’s energy market will be more diverse, with greater opportunities for investors to provide innovative and sustainable energy solutions within credible and predictable regulatory frameworks.”

As a result electric vehicles will be more widely used.

Understanding the implications

What do these predictions mean for stakeholders in the sector?

“It is important for those in the energy sector to be abreast of its developments and its implications for business. Players within the energy sector should also be alive to the legalities relating to determinations of new generation capacity under the Electricity Generation Act, particularly as this influences overall energy demand and supply. “

Join the 'South African Energy Law and Governance' course hosted by UCT [email protected] where Glasewski and Rumble provide deeper insights into the policies surrounding energy usage in South Africa.

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