SA emissions improving but Eskom, Sasol are worrisome outliers

In the next few months, broad discussions will begin on revising the greenhouse gas emissions (GHG) limits to which South Africa was committed – after very little consultation – by minister Buyelwa Sonjica at the December 2009 Copenhagen COP Summit. But can we live up to our promises?

Sonjica committed South Africa to keep its annual range of emissions between 398 and 614m tons (Mt) of CO2 equivalent (CO2e) in the period 2025-2030 and contain them to 212-428Mt CO2e by 2050. These targets were considered over-ambitious in some quarters and under-ambitious in others.

At the upcoming COP 26 conference, originally due to take place in Glasgow in November this year, but now postponed for a year, President Cyril Ramaphosa has committed to presenting new peak, decline and plateau targets.

“I agree there should be public consultation. It is a national target and will need buy-in from society,” said Louise Naudé, WWF-SA Programme Manager: Low-carbon Framework. She believes South Africa could do better, and save money, by moving to almost 100% renewable power generation.

After ten years of sluggish economic growth, South Africa’s coal-dependent economy appears to be staying within its 2009 commitments. That appears to be because measurements are incomplete, and data is not easy to access. The biggest emitter of greenhouse gases in South Africa, Eskom, continues to run a fleet of ageing coal-fired power stations, one-third of South Africa’s liquid fuels are derived from coal, while government has continuously delayed rolling out renewable power or a gas economy.

In 2015, the last time an in-depth GHG measurement report was made public, South Africa’s peak emissions, excluding forestry and other land use, were estimated at 541Mt of CO2e. Of that figure, 430Mt or 79.5% came from the energy sector (electricity generation, oil refining and transport). On a per capita basis, South Africa is the world’s tenth-largest GHG emitter, according to the Union of Concerned Scientists.

Eskom accounts for 42% of South Africa’s GHG emissions and Sasol (mainly because of its coal-to-liquids or CTL technology) accounts for about 11%.

In April this year, the Centre for Environmental Rights (CER) successfully won an appeal against the Department of Environment, Forestry and Fisheries’ (DEFF) refusal to release the detailed annual reports submitted by 16 of South Africa’s biggest GHG-emitting companies, which included Eskom, Sasol, ArcelorMittal SA and Anglo American.

Nicole Loser, an attorney for the CER’s Pollution and Climate Change Programme, said the listed companies report voluntarily to the public on their emissions and targets. The available information is not necessarily comparable because it covers different year-ends or levels of detail, unlike the annual reports submitted to DEFF. For example, ArcelorMittal’s head office in Luxembourg reports for groups of countries, so there is no detail available on emissions from the South African operations.

This article was first published in the Mining Yearbook 2020 which is available here: https://www.miningmx.com/the-mining-yearbook-2020/

Leanne Govindsamy, head of the CER’s Corporate Accountability and Transparency Programme, said companies need to disclose their climate change risks and how they are responding so investors, communities, civil society and the media can engage with companies that do not show a willingness to reduce emissions and manage their risks.

After ten years of sluggish economic growth, South Africa’s coal-dependent economy appears to be staying within its 2009 commitments. That appears to be because measurements are incomplete, and data is not easy to access.

South African companies agree with government on an annual ‘carbon budget’, or amount of CO2 they will emit in the forthcoming year. Under the Climate Change Bill, disclosure of this budget becomes mandatory. That would have happened in 2020 but the bill is expected to be enacted this year, so mandatory disclosure will only occur in 2021.

Naudé said one of the issues that has held up the passing of the bill is the business sector’s intense opposition during Nedlac discussions to the imposition of penalties on companies that exceed their carbon budget. The business sector has argued that the carbon tax (introduced from July 2019) is already a punitive measure.

The good news is that “… some companies understand that we have to get to net zero emissions by 2050, are standing up for that, taking own action and collaborating with others to make it happen,” she said.

EMITTERS WITH A CAPITAL ‘E’

Eskom’s annual report for the year to March 2019, the latest available, stated its CO2 emissions as a group were 220.9Mt, up from 205.5Mt in 2018, although it burnt less coal. It also emitted more SO2 and NO2. Up to 2018, its emissions were falling, but this was because it was generating less electricity.

Its average emissions across the fleet, according to a spokesman, are 1kg/kWh.

Eskom said its emissions remain high because of its dependence on coal, which provides base-load power for the country. However, the trade-offs for South Africa are that coal-fired power is more affordable than renewable power (although it admits this is changing) and coal mining employs over 80,000 people. Its main strategy to reduce emissions is to drive energy efficiency, both for itself and its customers.

For economic reasons, Eskom has put 14 less efficient units, totalling 1,969MW, in reserve storage. It says it is looking at options to use this infrastructure in a way that mitigates socio-economic impacts and is more environmentally friendly. It has installed solar PV at two power stations, Lethabo (575kWp) and Kendal (620kWp) to reduce the auxiliary loads.

“The need to transition from coal-fired power production to ‘greener’ energy over time is well understood by Eskom,” said a spokesman. “As the owner and operator of the country’s coal power stations, Eskom has a key role to play in this transition. An additional role for Eskom in the transition, namely in the roll-out of renewable energy technologies, is certainly possible. This would, however, require approval by the relevant authorities.”

In its June 2019 financial year, Sasol published its first Climate Change Report. It said it had cut GHG emissions by about 13%, or 10Mt, since 2004 and it aims to reduce its absolute GHG from its South African operations by 2030 by at least 10% off the 2017 baseline. In 2019, Secunda was responsible for 84.9% of the group’s Scope 1 and 2 emissions.

An additional role for Eskom in the transition, namely in the roll-out of renewable energy technologies, is certainly possible. This would, however, require approval by the relevant authorities

Sasol’s two main challenges are its dependence on coal as a feedstock and the lack of alternative energy sources in South Africa, especially for Secunda. It has been improving its energy efficiency, reducing process emissions and installing other sources of energy, such as the two 10MW solar PV plants at Sasol and Secunda.

Sasol said the most robust parts of its business in a low-carbon future will be its gas value chain and its chemicals operations.

Without external compulsion from government, Eskom and Sasol will make no drastic changes. Government initiatives could include punitive environmental taxes or decisive action to install enough renewable power to make Eskom’s coal-fired power stations unnecessary.

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