Eskom key reason South Africa is big polluter

Nov. 25, 2011 - DONNA BRYSON - pro.energycentral.com

The coal-powered national electricity company is frank about its role in making South Africa the continent's worst contributor to global warming, but Eskom says it also has plans and pledges in place to ensure it does its part to save the world.

The state-owned utility company's actions and decisions can ripple across the continent. Eskom is Africa's biggest power utility, accounting for more than 60 percent of all the electricity generated on the continent, according to the World Bank. It also exports across southern Africa.

Critics and even supporters say Eskom should have started its move toward renewable sources of energy earlier, and now needs to set its ambitions higher.

South Africa emits more global warming gases than any other country on the continent and is the 13th largest emitter in the world, according to U.S. government analysis. The independent Carbon Disclosure Project, which tracks climate change information, says emissions from electricity generation - almost solely from Eskom - accounted for 45 percent of South Africa's emissions last year.

"Why do we emit so much?" said Steve Lennon, a top Eskom executive. "It's because we are 90 percent dependent on coal."

"That's an uncomfortable position for us at Eskom," Lennon told The Associated Press.

Coal is cheap and readily available, said Tasneem Essop, a former provincial environment minister in South Africa who will lead the World Wildlife Fund's international team at international climate change talks next week in South Africa.

After skepticism about renewables, she said Eskom "has ramped up ambitions, but we believe that can be strengthened."

Eskom is determined to increase its use of renewable energy sources like hydro, solar and wind, which now account for less than 5 percent of electricity generated in South Africa, Lennon said.

The South African government has pledged to get its greenhouse gas emissions to a third less than what could be expected by 2020 if it continued its current usage and growth patterns, and to 42 percent less than what could be expected by 2025.

The government also has set a goal of doubling its power generating capacity by 2030 to more than 89,000 megawatts. The cheapest way to do that, Lennon said, would be to continue relying on coal. Instead, proposals announced in May call for about 46 percent of the generating capacity to come from coal and more than 26 percent from renewable sources such as hydro, wind and solar.

"We'll see just a fundamental shift from a coal-based power sector to one that is a nicely balanced and diversified power sector," Lennon said.

South Africa is increasingly compared to emerging economies with big carbon footprints like China and India. In China, the energy mix includes 80 percent coal and 7 percent wind, hydro and solar. In India, it includes just under 55 percent coal, and about 32 percent hydro and other renewables.

If China and India are ahead when it comes to renewable energy, South African environment minister Edna Molewa said, her country can now benefit from their experience. South Africa has to balance its need to develop with its responsibility to help the world combat global warming, she told AP.

Energy is scarce across Africa, said the World Bank's sustainable development director for the continent, Jamal Saghir. That means not just factories, but schools and hospitals aren't operating at top potential. Coal will eventually have to be phased out, but it cannot be overlooked now anymore than wind and solar, Saghir said.

When it comes to renewable energy, "should we do more? Yes. Should we be more ambitious? Yes," Saghir said. He said the South African government and Eskom are headed in that direction.

In September, Eskom and the African Development Bank signed agreements for a total of $365 million in loans for Eskom's first large-scale renewable wind and solar projects. A month later, the World Bank weighed in with $250 million more in funding for those cutting edge renewable projects.

Eskom expects to start building the wind farm next year. It may take two or three more years of planning and design work before it can start building the solar plant.

Now, the company is building two new coal-fired plants. The Medupi plant is to be completed by 2015 and the Kusile plant by 2016. Eskom also has brought a coal-fired power station back into service, and two other stations that had been closed will soon be producing power again.

South Africa has severe power problems that came to a head in 2008, when shortages led to frequent and widespread blackouts that angered consumers and worried investors. The government fears supplies will be tight for the next few years.

The World Bank was so concerned, in 2010 it approved a $3.75 billion loan to help South Africa finish Medupi, despite opposition from environmental groups. While most of the loan, $3.05 billion, was for Medupi, wind and solar power projects were allocated $475 million of the total.

The World Bank's Saghir said the loan was made to help address threats to recovery and development across southern Africa.

Melita Steele, a climate change expert in South Africa with the Greenpeace environmental activist group, said the international community should stop funding any coal projects.

"You can just invest in renewables," she said.

The power crisis sharpened focus on energy efficiency. Consumers from small households to big mines are being encouraged to switch to energy efficient light bulbs and set goals for reducing consumption. A program to encourage homeowners to switch to solar water heaters by subsidizing the costs of the units started off slowly, with just 50,000 installed in three years. Lennon said he believes the government-set target of 1 million by 2015 can still be met.

At Eskom itself, solar panels began powering offices at three coal power plants this month.

The fact that there are more blueprints than actual projects is frustrating for Greenpeace's Steele.

"All we can see at this moment is talk," said Steele. Coal would not be considered cheap if the costs of global warming, pollution and other factors were included in its tally, she said. "Talk is cheap. Coal is expensive."