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Energy
Energy use in South Africa is characterised by a high level of
dependence on cheap and abundantly available coal. South
Africa imports a large amount of crude oil. A limited quantity
of natural gas is also available.
The Department of Energy's Energy Policy is based on the
following key objectives:
- ensuring energy security
- achieving universal access and transforming the energy
sector
- regulating the energy sector
- effective and efficient service delivery
- optimal use of energy resources
- ensuring sustainable development
- promoting corporate governance.
Integrated Resource Plan (IRP)
The Integrated Resource Plan (IRP) lays the foundation for the country's energy mix up to
2030, and seeks to find an appropriate balance between the
expectations of different stakeholders considering a number
of key constraints and risks, including:
- reducing carbon emissions
- new technology uncertainties such as costs, operability
and lead time to build
- water usage
- localisation and job creation
- southern African regional development and integration
- security of supply.
The IRP provides for a diversified energy mix, in terms of new
generation capacity, that will comprise:
- coal at 14% (government's view is that there is a future for
coal in the energy mix, and that it should continue research
and development to find ways to clean the country's
abundant coal resources)
- nuclear at 22,6%
- open-cycle gas turbine at 9,2% and closed-cycle gas
turbine at 5,6%
- renewable energy carriers, which include hydro at 6,1%,
wind at 19,7%, concentrated solar power at 2,4% and
photovoltaic at 19,7%.
The IRP is intended to:
- improve the long-term reliability of electricity supply through meeting adequacy criteria over and above keeping pace with economic growth and development
- ascertain South Africa's capacity investment needs for the medium-term business planning environment
- consider environmental and other externality impacts and the effect of renewable energy technologies
- provide the framework for ministerial determination of new generation capacity (inclusive of the required feasibility studies) as envisaged in the new generation capacity regulations.
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Power sources
Coal
In addition to the extensive use of coal in the domestic
economy, about 28% of South Africa's production is exported,
mainly through the Richards Bay Coal Terminal, making South
Africa the fourth-largest coal exporting country in the world.
South Africa's coal is obtained from collieries that range
from among the largest in the world to small-scale producers.
About 51% of South African coal mining is done
underground and about 49% is produced by open-cast
methods. The coal-mining industry is highly concentrated,
with a few companies accounting for 85% of saleable coal
production.
Production is concentrated in large mines, with 11 mines
accounting for 70% of the output. South African coal for local
electricity production is among the cheapest in the world. The
beneficiation of coal, particularly for export, results in more
than 65 million tons (Mt) of coal discards being produced
every year.
About 21% of the run-of-mine coal produced is exported,
and 21% is used locally (excluding power-station coal). The
rest is not saleable and is discarded. The remainder of South
Africa's coal production feeds the various local industries:
- 62% is used for electricity generation
- 23% for petrochemical industries (Sasol)
- 8% for general industry
- 4% for the metallurgical industry (Mittal)
- 4% is purchased by merchants and sold locally or exported.
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Nuclear
Cabinet approved the Nuclear Energy Policy [PDF] for South Africa in June 2008. The policy aims to increase the role of nuclear energy as part of the process of diversifying South Africa's primary energy sources to ensure energy security. The policy will ensure reducing the over-reliance on coal.
Eskom is investing up to 20 000 MW on new nuclear capacity by 2025.
Eskom's Koeberg Nuclear Power Station's two reactors
outside Cape Town supply 1 800 MW to the national grid when both operate at full power, thus providing about 6,5% of
South Africa's electricity.
The National Nuclear Regulator is the prime safety regulator and is responsible for protecting persons, property and the environment against nuclear damage by establishing safety standards and regulatory practices. It exercises safetyrelated regulatory control over the siting, design, construction and operation of nuclear installations and other actions.
The Nuclear Energy Corporation of South Africa (Necsa) undertakes and promotes research and development in the field of nuclear energy, radiation sciences and technology, medical isotope manufacturing, nuclear liabilities' management, waste management and decommissioning. It is a public entity reporting to the Minister of Minerals and Energy.
Necsa's reactor-produced radioisotopes are exported to more than 50 countries.
The research reactor at Pelindaba, Safari-1, is the most commercialised reactor of its kind in the world with International Organisation for Standardisation 9001-accreditation. It earns South Africa foreign revenue worth millions of rands.
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Liquid fuels
A key feature of the South African liquid fuels sector is the fact that most of the transport fuel is produced in the coastal areas but about 68% thereof is consumed in the inland region of Gauteng. This requires investments in the storage and distribution facilities for the supply of petroleum products at the point of need.
A new R15-billion pipeline to transport petroleum from Durban to Johannesburg is under construction for completion in the 2011/12 financial year.
Through the construction of the new multi-product pipeline, Transnet Pipelines will increase fuel-carrying capacity by 8,7 billion litres per annum in 2011, by 12,2 billion litres per annum in the second phase of the of the project and by 26,2 billion litres in the ultimate fifth phase of the project. This investment is in direct aid of South Africa's security of supply of energy going into the future.
The petrol price in South Africa is linked to certain international petrol markets in United States dollar. This means that supply and demand for petroleum products in the international markets, combined with the Rand-Dollar exchange rate, influence the domestic price.
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Oil and gas
South Africa has limited oil reserves and imports from the Middle East and Africa (Saudi Arabia, Iran, Kuwait, the United Arab Emirates, Yemen, Qatar, Iraq, Nigeria, Egypt and Angola) meet about 95% of South Africa’s crude oil requirements.
Refined petroleum products such as petrol, diesel, residual fuel oil, paraffin, jet fuel, aviation gasoline, liquified petroleum gas and refinery gas are produced by:
- refining crude oil (oil refineries)
- converting coal to liquid fuels and gas to liquid fuels (Sasol)
- turning natural gas into liquid fuels (PetroSA).
Another major role player in South Africa's liquid fuels industry is the Central Energy Fund (CEF). Its mandate is to engage in acquiring, exploring, generating, manufacturing, marketing and distributing any energy form, especially oil and gas. It
also engages in research relating to the energy sector.
The CEF's diversified portfolio of activities is housed in the following active subsidiaries:
- The Strategic Fuel Fund Association, which was established to procure and store crude oil and manage strategic crude oil stocks for South Africa. It trades and leases spare storage ullage and is involved in oil-pollution control.
- PetroSA, which owns and operates the gas-to-liquids plant at Mossel Bay. PetroSA is also involved in oil and gas exploration and production, and its offshore production platform supplies gas and condensates by gas pipeline to its onshore plant for conversion into a range of environmentally friendly transportation fuels and associated products for the domestic and international markets.
- The Petroleum Agency South Africa, which promotes and markets exploration in South African territory (both offshore and onshore for oil and gas), negotiates and monitors concessions and licences on behalf of government, and is the custodian of geological and geophysical data.
- iGas, which is a state-owned entity for the development of gas infrastructure in South Africa. iGas partnered Sasol and ENH of Mozambique in establishing the natural gas pipeline from Mozambique to South Africa.
Government has committed to a 2% blend target for biofuels
inclusion in the national fuel supply. In addition, several other
developing countries have set blending targets of 10% for
biofuels without any need for significant engine adjustment.
Were South Africa to increase its blending target to 10%,
some 125 000 direct jobs could be created, many of which
would be based in rural areas, where the deepest pockets of
poverty occur.
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Electricity
Eskom generates, transmits and distributes electricity to industrial, mining, commercial, agricultural and residential customers and redistributors. The majority of sales are in South Africa and other countries of southern Africa account for a small percentage of sales. It generates about 95% of the electricity used in South Africa and about 45% of the electricity used in Africa.
South Africa is faced with a situation in which the demand for electricity continues to grow within a supply-constrained environment.
Eskom's New-Build Programme was launched in 2005 with
the aim of adding more than 17 000 MW to the national electricity
grid by 2018. By mid-2011, more than 5 000 MW of new
generation capacity and more than 3 000 km of new transmission
lines had been added to the country's electricity grid.
As part of the programme, Eskom has spent R20,5 billion
on recommissioning three power stations that have been out of service for over 20 years: Camden, Komati and Grootvlei,
all in Mpumalanga. Together, the stations can produce an
estimated 3 800 MW, which equals that of a new power
station. The cost of recommissioning the retired stations is
estimated at almost R100 billion less than a new station, and
the electricity will be available sooner. Camden was reopened
in 2010, with work progressing on Komati and Grootvlei.
Eskom aims to have all three operational by 2013.
Construction of two massive new coal-fired stations Medupi and Kusile is in progress.
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Integrated Electrification Programme
The electrification programme is a modern energy option
and also has a positive socio-economic impact on the lives
of South Africans. There have been improvements in the
education, health and social circumstances of communities
that have been electrified through the grid and off-grid
technologies. By 2011, South Africa's energy penetration
stood at over 75%, and with R3,2 billion allocated to the
electrification programme, the department aimed to connect
an additional 150 000 households, build 10 substations and
contribute about 5 000 jobs. In 2010/11, the department
created 5 811 jobs and connected 195 000 homes to the
electricity grid, exceeding its target by 45 000 households.
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Solar energy
Solar power is being used increasingly for water-pumping
through the rural water-provision and sanitation programme
of the Department of Water Affairs.
Eskom's Solar Water Heating Programme has gained
momentum, with 60 183 claims received for the solar water
heating rebate, of which 41 690 were paid by the end of 2010.
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Wind energy
The Darling Wind Farm in the Western Cape has four wind
turbines. All the electricity produced will be sold to the City
of Cape Town as part of a long-term power agreement with the city. The facility consists of four German-designed
wind turbines. The structures are 50 m high with the blades
spanning 31 m. Each turbine will produce 1,3 MW, bringing
the total output of the wind farm to 5,2 MW.
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Energy efficiency
Government set a target of 15% energy efficiency for the
industry and 12% nationally to be achieved by 2015. The
energy industry leads by example by committing to energy
efficiency.
While the focus has been on energy-intensive industries,
room has been created for other industries and the
commercial sector to join the Energy-Efficiency Campaign,
through the introduction of, among other things:
- efficient lighting and heating, ventilation and air conditioning
and employee education
- efficient production processes and cogeneration in the
industrial sector.
Government remains committed to the efficient use of available
resources. It is also committed to broadening the energy mix,
thereby moving away from being fossil-dominated to a more
balanced combination, which places a high premium on the
use of more efficient technologies and renewable-energy
resources.
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Sasol
Sasol is an integrated energy and chemical company. It beneficiates coal, oil and gas into liquid fuels, fuel components and chemicals with the help of its proprietary Fischer-Tropsch processes.
It mines coal in South Africa and produces gas in Mozambique and oil in Gabon. Its chemical manufacturing and marketing operations span the globe.
In South Africa, Sasol refines imported crude oil and retail liquid fuels through its network of retail-convenience centres. Sasol also supplies fuels to other distributors in the region and gas to industrial customers in South Africa.
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Energy and the environment
South Africa is among the top 20 emitters of greenhouse gases (GHGs) in the world and is the largest emitter in Africa, largely because of the economy’s dependence on fossil fuels. The National Climate Change Strategy [PDF], developed by the Department of Environmental Affairs, requires that government departments collaborate in a coordinated manner to ensure that response measures to climate change are properly directed and carried out with a national focus. The Department of Energy is expected to respond to and mitigate climate change.
South Africa is a developing country or a Non-Annex1 country. This means that within the international political and negotiation context, South Africa is not required to reduce its GHG emissions.
However, the South African economy depends greatly on fossil fuels for energy generation and consumption. It therefore is a significant emitter due to relatively high values being derived from emissions’ intensity and emissions per capita.
South Africa must therefore proactively move the economy towards becoming less carbon-intensive, with the Department of Energy playing a prominent role.
The department has introduced systems to access investment through the Clean Development Mechanism of the Kyoto Protocol [PDF]. It has developed the White Paper on Renewable Energy and Clean Energy Development [PDF], together with an energy-efficiency programme, to support diversification in pursuit of a less carbon-intensive energy economy.
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Last modified: 06 March 2013 14:01:50. |
