GAVIN NOETH: Just transition not just about gas but entire communities and supply chains

It’s no surprise that SA’s energy crisis has become top-of-mind for both consumers and businesses as the rate and magnitude of load-shedding have increased over the past few years.

The country’s energy supply is under strain due to breakdowns in ageing infrastructure and a growing gap in power generation capacity and electricity demand.

Columnist Peter Bruce has been making the case for a swift transition from coal-powered to renewable energy in response to the government’s proposal to first transition to an alternative to coal such as liquefied natural gas (LNG), to ensure a “just transition” (“Just think ... the sun and wind are ours for free”, March 9, and “The Just Transition: the mother of all party-funding and get-rich schemes”, March 30). 

The concept of a just transition was developed in the 1990s by North American unions that wanted to create a programme of support for workers who lost their jobs as a result of environmental protection policies. Today the International Trade Union Confederation defines the purpose of a just transition as: “To secure the future and livelihoods of workers and their communities in the transition to a low-carbon economy”.

The aim of the just transition in SA’s energy sector is to ensure the protection of workers within the coal industry as the country moves to greener energy sources.

In Bruce’s column he berates energy minister Gwede Mantashe and the National Business Initiative for their determination to pursue a change to LNG-powered energy, and notes that there is no merit in doing so. But is it as straightforward as that? While LNG is also a fossil fuel like coal, it has a far less negative effect on the environment. According to the US Energy Information Administration, burning natural gas emits 50%-60% less carbon dioxide compared to a typical new coal plant, so it’s not as ridiculous as Bruce asserts. On the face of it this could be a sensible strategy as we transition to green sources of energy. 

However, Bruce is correct in his statement that a shift to LNG would result in our dependence on 100% imports, from the LNG itself to the technology and infrastructure to support it. As he notes, Russia is the world’s fourth-largest LNG exporter and accounts for about 8% of global LNG supply. With the war in Ukraine and sanctions imposed on Russia, commodity prices will continue to increase as long as those sanctions continue. The collateral damage may include the slowdown of our energy transition to LNG, and it will definitely be more expensive.

This is the springboard Bruce uses to make his case for an immediate switch to renewable energy. But while we most certainly have more than enough land and open space for solar photovoltaic and wind turbine plants, these renewable energy sources cannot provide for a baseload (the minimum amount of electric power needed by the grid). Simply put, what happens at night when the sun is not shining or if the wind doesn’t blow?

Bruce fairly contends that we already have a solution for this in lithium-ion batteries, but I don’t think it’s as clear cut as that. His opposition to LNG as a transition stage to renewables seems to rest solely on the dependence on imports surrounding it, but lithium presents a similar challenge. In 2019 the biggest producers of lithium were Australia (52.9%), Chile (21.5%), and China (9.7%). SA has no significant lithium reserves, and there is only one mine on the entire African continent that produces lithium. 

Finally, Bruce ends one of his columns by saying that we should not “bog ourselves down in fruitless debate that would make investors rich and the rest of us poorer”, and in his latest column he boldly declared the just transition a “get-rich scheme”. In doing so he seems to entirely dismiss the effects of transitioning to greener energy on the people within the coal industry as a non-concern. Whatever the intent of the energy minister and other stakeholders in the sector, the negative implications for employment in the sector are real, and will be felt by ordinary working South Africans. So, an analysis of all the options available is certainly not “fruitless”.

More than 80,000 people are employed in the coal-mining sector, and no matter which path is chosen — whether it’s the government’s shift to LNG first or a direct transition to renewables as Bruce demands — jobs will be lost. LNG is an extremely complex industry and the average coal miner doesn’t have a clue about how to run an LNG plant, while highly qualified and skilled engineers and technicians are required for maintenance and repair. Thus, LNG is not a panacea for the just transition. Additionally, both LNG and renewables like solar and wind are not as labour intensive as coal. It’s possible that only about 20,000 to 30,000 coal jobs could transition to renewables.

It’s clear that we need to start the move to greener energy production. SA does not exist in a vacuum, something the energy minister seems to be oblivious to, and the world is moving away from coal at the speed of light. The EU is already looking at introducing import duties or other forms of taxation on the importation of goods and services dependent on coal for their production and supply, and other countries are likely to follow. More importantly, we need to drastically reduce our impact on the environment and mitigate climate change. 

Unfortunately, this transition is more complex and difficult to navigate than we want it to be. We can’t simply forget that there are real people who will be affected by the decisions we make in doing so, and we have a responsibility to ensure that the negative consequences are limited as far as possible.

This is because those affected aren’t just the men and women who work in the mines or even those employed across the rest of the coal value chain, but also includes their families and the communities that have developed around and are dependent on coal-fired power plants.

That is what the just transition is all about. 

• Noeth is senior consultant: infrastructure & projects at CMS SA.