“No single sector of the economy has more than 50% black ownership in large entities, with entities in historically white-dominated sectors of the South African economy such as finance (25%) and agriculture (12%) particularly resistant to change. Construction (48%), property (42%) and ICT (36%) are deemed to be showing “relatively good” progress. Black women remain particularly marginalised, with their average ownership of large entities just 12.1%.” – Broad Based Black Economic Empowerment Commission report 2020
Just two weeks ago South Africa’s Minister of Electricity Kgosientsho Ramokgopa reported to parliament that “in 2022, we (‘South Africans’) lost upwards of 650,000 jobs as a result of load-shedding. The projection, at the current rate of load-shedding, is we are on course to lose 850,000 plus jobs”. These stats are frighting to say the least as most energy experts predict that there are no short-term solutions to solving South Africa’s energy crisis.
With all the chatter on how we can end loadshedding in South Africa and Africa as a whole, whether we should be investing in maintaining our coal power stations or if we should be making a greater effort to go green. I always wonder if our continent has truly considered the livelihoods of our people. The real question we should be asking ourselves as Africans is how we can strengthen Africa in the journey embarked upon by globe to limit the global temperature to 1.5 degrees by 2030. We all agree that the effects of climate change have negatively affected the globe but if Africa manages to achieve net zero emissions by 2050 but remains impoverished it would have failed itself. At some point as Africans we ought to move away from the position of being #resilient to a position where our people excel
Just transition?
The term ‘just transition’ was originally used in the 1980’s when it was used in a movement by United States trade unions to protect workers affected by new water and air pollution regulations. These days however, the term is commonly used in reference for achieving climate change goals with environmental, social and governance considerations. With a greater focus (in my opinion) on environmental and governance concerns than the social considerations.
The first major step towards the fight against climate change was the adoption of the Paris Agreement (December 2015), which 196 parties (you could also say territories/countries) legally bound themselves to an international treaty on climate change. The Paris Agreement works on a five-year cycle of increasingly ambitious climate action which has really ramped up since 2020 where the parties have been submitting there Nationally Determined Contributions (NDCs). The Paris Agreement provides a framework for financial, technical, and capacity building support to those countries who need it.
What you need to know about National Determined Contributions (NDCs)
Firstly, countries communicate actions they are willing to take to reduce their greenhouse gas emissions as per the goals contemplated in the Paris Agreement. The actions communicated include finance, technological and capacity building contributions. In South Africa the Presidential Climate Commission is the biggest driver of National Determined Contributions communications for South Africa’s response to climate change. The powers for the Presidential Climate Commission will be derived from the Climate Change Bill which is still under consideration. Furthermore, with the Paris Agreement countries have established enhanced transparency framework in which countries will report actions taken and progress in climate change mitigation.
The Just Energy Transition Investment Plan
Part of the Just Energy Transition Investment Plan (“JET-IP”) is the South African Renewable Energy Masterplan which is industrial related policies to address the possibility for a renewables industry in South Africa. The JET-IP initially published on the 4th of November 2022 by the Presidential Climate Change Commission Details South Africa’s commitment to tackling climate change and the policies it seeks to develop in order to achieve its targets.
A major announcement was recently made by the World bank when it issued a statement that the ‘Komati Just Energy Transition Project’ would be financed jointly through a $439.5-million World Bank loan (approximately R8.5 trillion), a $47.5 million (R905 million) concessional loan from the Canadian Clean Energy and Forest Climate Facility, and a $10-million (R192 million) grant from the Energy Sector Management Assistance Program.
This loan would go towards assisting with the decommissioning and repowering of the Komati coal-fired power plant using renewables, batteries and would go a long way to assisting with South Africa’s Just Transition plans.
Our View
Former Eskom CEO Andre De Ruyter believed that the power challenges along with South Africa’s climate change targets could be solved by investing in renewable energy. This is evident by the investment into the Renewable Energy Independent Power Producer Programme. A lot of controversies have stemmed from Andre De Ruyter’s tenure at Eskom but the biggest one is the lack of planning for people’s livelihoods.
Shutting down coal fired powered and replacing them with renewable energy will shed a lot of jobs and till date there has been no significant plan to replace all those jobs. Furthermore, South Africa intends on taking massive loans to implement these plans with no talk of “native” ownership or empowerment of the previously disadvantaged.
South Africa has a huge opportunity to empower previously disadvantaged individuals by ensuring significant participation and ownership by them in these projects.
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