The event brought together thought leaders, policymakers, and academics to explore the complexities of transitioning from a coal-reliant energy system to renewable energy while addressing economic implications and social equity.
The dialogue highlighted SA's heavy reliance on coal, the backbone of its energy system, and the challenges associated with moving towards renewables.
The government’s decarbonisation efforts, compounded by a history of load-shedding, have spurred optimism for economic growth and job creation in the coming years. However, the transition remains contentious due to the significant costs involved.
A delegate from the University of Johannesburg criticised what he termed a “false narrative” around SA’s energy transition. He argued that this misleading perspective could lead to harmful policy decisions. He highlighted several key points:
1. Hidden Costs of Renewables: The initial contracts for renewable energy and grid investments, which he pegged at an estimated R1.3 trillion, have not been fully accounted for. This omission, he suggested, creates a skewed perception of renewable energy being cheaper than coal.
2. Global North’s Role: The delegate claimed that international funders, including organisations backed by the European Union and Canada, are disproportionately shifting the financial burden of the energy transition onto the Global South. “The United States continues to extract hydrocarbons while urging countries like South Africa to abandon coal,” he said, calling the approach hypocritical.
3. Lack of Costing by National Treasury: National Treasury has yet to fully assess the fiscal implications of the renewable energy transition, adding to the uncertainty.
Acting Chief Director for Macroeconomic Policy at the National Treasury, Kuben Naidoo confirmed that a study is underway to evaluate the costs of the transition. While acknowledging Treasury’s cautious approach, Naidoo assured that transparency would be upheld through publicly available reports.
Joanne Yawitch, Head of the Just Energy Transition Project in the Presidency, shared insights into government efforts to convert international funding from loans to grants. However, she raised concerns about the allocation of these funds.
“Much of the funding is tied up in research, technical assistance, and capacity building rather than reaching communities directly impacted by the transition,” Yawitch noted. She emphasised the need for resources to flow into projects that uplift coal-dependent regions such as Mpumalanga.
To address this, the government has piloted a funding platform in Mpumalanga designed to connect funds with small and medium enterprises (SMEs), community organisations, and worker groups. This initiative aims to develop and finance projects that promote inclusive economic growth while ensuring a just transition.
--ChannelAfrica--
