A logo sits on a window at the entrance hall of the Congress Center on the opening day of the World Economic Forum (WEF) in Davos, Switzerland, on Tuesday, January 22 2019. Picture: GETTY IMAGES/ BLOOMBERG/ JASON ALDEN
A logo sits on a window at the entrance hall of the Congress Center on the opening day of the World Economic Forum (WEF) in Davos, Switzerland, on Tuesday, January 22 2019. Picture: GETTY IMAGES/ BLOOMBERG/ JASON ALDEN

SA has made little progress in preparing for energy transition over the past year and still lags most of the world, according to the World Economic Forum’s (WEF's) energy transition index 2020 published on Wednesday.

The index ranks SA 106 out of 115 countries, improving nine places over the past 12 months. The countries are benchmarked on the performance of their energy systems and their readiness for transition to secure, sustainable, affordable and inclusive systems.

The annual findings come as the government moves to demonstrate its commitment to procure new power generation in line with the Integrated Resource Plan, SA’s national energy road map, which makes way for renewable energy while phasing out polluting coal-fired power stations.

But the risk of load-shedding persists as monopoly power utility Eskom struggles to meet demand, which is deterring investment and throttling economic growth.

“Energy security and environmental sustainability remain areas of concern, as the power blackouts continue, and coal continues to remain the mainstay of the energy system,” the WEF said in a statement.

“The power blackouts have made a significant dent in SA’s GDP, demonstrating the economic dimensions of the energy system.”

At 106, SA ranks just ahead of Zimbabwe and just below the central Asian republic of Kyrgyzstan.

Sweden was top of the index for the third year running, followed by Switzerland and Finland.  The study found emerging centres of demand such as India, which ranked 74th, and China (78th), have made consistent efforts to improve the enabling environment.

Of the 115 economies studied, the WEF found 94 had made progress towards clean energy since 2015 and 75% of countries had improved on environmental sustainability.

The study, however, found that globally progress was stalling. “Gains since 2015 have only been incremental and breakthrough solutions are urgently required.”

The WEF warned that the disruption of the Covid-19 pandemic could cancel out recent progress in transitioning to clean energy, with unprecedented falls in demand, price volatility and pressure to quickly mitigate socioeconomic costs, placing the near-term trajectory of the transition in doubt.

“Policies, road maps and governance frameworks for energy transition at national, regional, and global levels need to be more robust and resilient against external shocks,” the organisation said in the report.

“The coronavirus pandemic offers an opportunity to consider unorthodox intervention in the energy markets and global collaboration to support a recovery that accelerates the energy transition once the acute crisis subsides,” said Roberto Bocca, WEF head of energy and materials.

“This giant reset grants us the option to launch aggressive, forward-thinking and long-term strategies leading to a diversified, secure and reliable energy system that will ultimately support the future growth of the world economy in a sustainable and equitable way.”

steynl@businesslive.co.za