SOUTH Africa’s Department of Mineral Resources and Energy (DMRE) has updated its Integrated Resource Plan (IRP) on the country’s energy generation up to 2030. The IRP aims to diversify the energy mix while attempting to address the serious problem of insufficient energy capacity.
The IRP is South Africa’s official policy on “least-cost” electricity development up to 2030. The IRP was first released in 2010 and was supposed to be updated regularly, but two proposed drafts in 2013 and 2016 were not adopted. The Cabinet finally approved an update through the IRP 2019 on 18 October. While IRP 2019 promotes a diversified energy mix, which includes coal, renewables, and nuclear, the country will still rely mainly on coal.
According to Carbon Brief, coal made up 88% of the country’s energy needs in 2017 and renewables contributed 3.4%. Under IRP 2019, coal’s contribution is projected to drop to 58.8% in 2030, with renewables rising to 24.7%. The energy sector currently is responsible for almost 80% of South Africa’s greenhouse gas emissions, with 50% of this is coming from electricity generation and liquid fuel production.
IRP 2019 states that old coal plants will gradually be retired, with 10,500 MW expected to be decommissioned by 2030. However, two new plants, of 750 MW capacity each, will be added. The plan notes that no new plants will be built after 2030, unless affordable cleaner forms of coal are available.
According to Engineering News, Gwede Mantashe, Mineral Resources and Energy Minister, said at a media briefing that coal power will still be around for a long time. "We are going to still have a big volume of electricity generation of coal. Therefore we are cautioning [those] who are saying coal is coming to an end – we have 16 power stations which are coal-fired. That is the reality of today. Coal will continue to play a significant role." He added that coal investors should direct their funds to clean coal technologies so that coal can be used in an environmentally responsible manner.
The report says that coal plants will have to meet the country’s Minimum Emissions Standards (MES) by a certain time or they can’t be legally operated. The MES was set up in 2010, but currently there has been a significant delay in applying the standards. Eskom, the state-owned electricity utility that provides 95% of the country’s power, was granted a five-year postponement on compliance in 2014, and it is currently applying for further postponement. Cost is a major problem in retrofitting plants, with many unable to afford upgrades such as flue gas desulfurisation, according to Engineering News. The IRP report also notes that the timing of the closure of non-compliant plants will have to take into account energy security, poor air quality, and the economic cost.
South Africa’s only nuclear power station, Koeberg, will reach the end of its life in 2024. The IRP proposes extending its lifetime to 2044, and the government is currently in talks with Eskom to achieve this. Although no new nuclear capacity is planned before 2030, the report says that consideration must be given to developing a future nuclear programme.
While renewable capacity will undergo a major increase, there will still be a restriction on how much new renewable energy can come online each year. The report says that the annual build limits on renewables are necessary to “smooth out” the capacity allocations and provide a constant pipeline of projects which would attract investors. This restricts new capacity to 1,000 MW/y for photovoltaic solar power, and 1,600 MW/y for wind power.
The IRP also considers other forms of electricity generation, and notes that generation of electricity and heat from biomass and biogas holds huge potential. It highlighted that Eskom is already planning a battery energy storage pilot to assess the technological and regulatory matters relating to utility-scale energy storage.
Other policy adjustment considerations in the plan include initiating a power purchase plan to create reserve capacity, convening a team within a year to put together a “just transition plan”, and supporting the development of gas infrastructure.
South Africa is subjected to numerous rolling blackouts, known as load-shedding, which are scheduled to affect different areas at different times in a bid to prevent a complete failure of the national grid. Load-shedding has been occurring intermittently for over a decade as Eskom cannot keep up with demand. Its struggle to meet demand is due to a significant proportion of energy capacity often being out of service. According to Reuters, this is due to a combination of Eskom’s severe debt, delays to critical maintenance, diesel shortages, fraud and corruption, and design flaws at two major new coal-fired power plants, Medupi and Kusile. Eskom’s energy availability factor (EAF) is an average 67.75% for the year-to-date according to The Citizen.
The IRP notes “there is an immediate risk of huge power shortages”. There are inadequate capacity reserves in the event of emergency plant breakdowns and this situation would worsen if all plants that are non-compliant with MES are shut down. The continued underperformance of Medupi and Kusile will also increase the risk, along with the potential closure of Koeberg in 2024. The report warned that diesel plants running during peak hours would still be necessary up to 2021. However, there is insufficient infrastructure for high volumes of diesel and the cost is prohibitive.
Members of the University of Cape Town's energy systems research group, writing for newspaper Business Day, noted that the policy goals of the IRP are not broad enough. They noted that the main policy focus is tackling poverty and creating jobs, when the plan should address at the role of the electricity sector in meeting economic, social, and environmental policy goals. The authors raise their concern over the medium-term focus on coal capital and labour, rather than larger national policy imperatives. They also point out that the IRP cites the lack of a “just transition plan” to justify the continued use of coal and the constraints on new renewables.
NJ Ayuk, Executive Chairman at the African Energy Chamber and CEO of the Centurion Law Group, welcomed the report. “The approval of the revised IRP2019 is a breakthrough for South Africa, which has huge energy investment potential. South Africa is sending a message that its institutions are aligned towards clear goal and objectives, and are ready to work hand-in-hand with the private sector to achieve a common development vision.”
The addition of new renewables capacity was welcomed by the South African Photovoltaic Industry Association (SAPVIA) and the South African Renewable Energy Council (SAREC). However, given the latest round of load-shedding, both organisations urged the DMRE to launch the latest bidding round for new renewable power, which was supposed to be announced in November 2018.
The addition of new coal plants has been met with criticism. Makoma Lekalakala, Director of EarthLife Africa, said: “There is no reasonable basis for building new coal plants when the technology and costs are clearly in favour of renewables and flexible generation. We no longer need to choose between clean and cheap electricity – clean energy is an affordable, healthy and feasible alternative.”
Happy Khambule, Senior Political Advisor for Greenpeace Africa, said: “This IRP contradicts the urgent need for a just transition and is completely out of touch with reality. South Africa is already a global air pollution hotspot because of the country’s almost complete reliance on coal. The IRP’s irrational increase in the use of coal will only result in yet more deadly toxic air, while wasting precious water resources and pushing us closer to the brink of complete climate chaos.”
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