726 research outputs found
Governing electricity in South Africa: wind, coal and power struggles
South Africa’s electricity policy is at a crossroads. Its historical dependence on cheap coal for approximately 90 per cent of its electricity generation is under threat. This paper firstly examines how the governance of South Africa’s electricity is inextricably bound up with the country’s historical dependence on cheap coal for export-oriented industry and complex political and economic legacy which has shaped its minerals-energy complex (Fine and Rustomjee 1996). Secondly it finds that despite regulatory hold-ups and departmental tensions, power dynamics in the electricity sector are shifting with the potential introduction of private renewable energy generation into the energy mix. Of this, wind is set to form the largest component. Meanwhile Eskom’s Medupi coal-fired power plant deemed as essential to the country’s generation expansion has been redefined as a ‘clean coal’ power plant following a World Bank loan of $3 billion in April 2010. The paper concludes that while vested interests in the country’s coal-based industrial trajectory are still very influential, they are simultaneously challenged with rising coal costs, imminent national electricity supply shortages and increasing tariffs, a funding crisis of the electricity utility, the demands of climate change mitigation and emerging stakeholders in renewable generation
South Africa’s renewable energy procurement: a new frontier?
Despite a continuing electricity crisis from its coal-fired sources, in recent years South Africa has become one of the leading destinations for renewable energy investment. This is thanks to the launch of its renewable energy independent power producers’ programme for which an estimated $14 billion/R168 billion has been committed thus far and approximately 4 GW of utility-scale renewable energy capacity approved. The programme is unique in that it in order for projects to qualify, developers must commit to undertake requirements for community ownership and economic development benefits in a country with gross socio-economic inequality. As the industry facilitated by RE IPPPP continues to develop, however, concerns have arisen including: the extent to which financial returns will leave or benefit the country; that the ownership of the industry is rapidly becoming the domain of large international utilities; and emerging tensions between ‘bankability’ required by banks and investors and the economic benefits and community ownership criteria
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Technology development in South Africa: the case of wind and solar PV
This paper examines the political economy of technology development in the context of South Africa’s emerging utility-scale, privately generated renewable energy sector. Focussing on the wind and solar PV industries, the paper explores how international dynamics in manufacturing, investment and trade that involve increasingly global industries, are interacting with territorial factors embedded within South Africa’s unique economic, social and political context. While South
Africa’s renewable energy industry has been celebrated internationally, there are tensions between
commercial priorities, and requirements for economic development including local content. The paper merges perspectives from global production networks and the literature on technological innovation in low and middle income countries in order to analyse the potential for the development of innovative capabilities in South Africa’s renewable energy sector. The paper provides rich
empirical content including challenges to the definition and implementation of local content requirements, as well as the involvement of key national and international actors
The political economy of decarbonisation: exploring the dynamics of South Africa’s electricity sector
South Africa’s coal-dominated electricity sector, a key feature of the country’s minerals-energy complex, is in crisis and subject to change. This offers potential opportunities for decarbonisation. Despite positive examples of decarbonisation in South Africa’s electricity sector, such as a procurement programme for renewable energy, there are structural path dependencies linked to coal-fired generation and security of supply. Decarbonisation goes far beyond what is technologically or even economically feasible, to encompass a complexity of political, social and economic factors. Meanwhile, decision-making in electricity is highly politicised and lack of transparency and power struggles in the policy sphere pose key challenges. Such power struggles are reflected in national debates over which technologies should be prioritised and the institutional arrangements that should facilitate them
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The political economy of technological capabilities and global production networks in South Africa’s wind and solar photovoltaic (PV) industries
We examine underlying conflicts between technological capabilities and global production networks in South Africa’s solar photovoltaic (PV) and wind energy industries. This includes an analysis of the complex and multi-scalar relationships that exist between international and local institutions, as well as the embedded nature of renewable electricity technology within a national and international political economy. In South Africa’s case, this encompasses endogenous factors such as the introduction of a regulatory framework for renewable energy independent power producers as well as international dynamics such as rapidly evolving trends in renewable energy investment, trade, and technology development. While South Africa’s wind and solar industries have been celebrated internationally, tensions exist within national government between commercial priorities and requirements for economic development including local content. We provide an empirically rich description to explore how competition and manipulation have posed obstacles to localisation of renewable energy technologies nationally
Commercial-scale renewable energy in South Africa and its progress to date
While South Africa's electricity sector is heavily coal-dependent, the country has recently become an attractive destination for commercial-scale renewable energy investment. This article examines ongoing developments and challenges to the country's Renewable Energy Independent Power Producers' Procurement Programme (RE IPPPP), from inception as a feed-in tariff in 2007, to its launch as a competitive bidding programme in 2011. The article discusses how the programme emerged out of a set of national conditions combined with international trends in renewable energy investment and technology development. The programme's successes include progressive requirements for socioeconomic development. However, since 2016, South Africa's renewable energy industry has faced complex challenges, including resistance by the electricity utility Eskom, itself embroiled within scandals of state capture and corruption, as well as the ability of Eskom's transmission grid to integrate renewable energy generation. Subsequent delays to the programme have generated uncertainty for stakeholders and the future of the industry
Understanding the Political Economy of South Africa’s Carbon Tax
South Africa is the only country in sub-Saharan Africa to have enacted a carbon tax to date. Although the country was ahead of the curve when it began considering the tax’s implementation in 2010, it took until 2019 for the Carbon Tax Act to be passed (RSA 2019). By this time 58 carbon taxes in 46 countries and 31 subnational jurisdictions had been implemented. This Research in Brief is a summary of ICTD Working Paper 150 by Lucy Baker
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Procurement, finance and the energy transition: between global processes and territorial realities
Utility-scale renewable electricity generation is essential to decarbonisation as well as to ensuring affordable and secure electricity supplies around the world. Yet thus far there has been limited critical thinking dedicated to the complexities behind the finance and ownership of this new infrastructure and how national and local stakeholders should participate in and benefit from its development, particularly in contexts of high inequality in low- and middle-income countries. As the global renewable energy industry becomes increasingly consolidated and financialised, evidence from a number of countries suggests that despite the pro-environmental outcomes of utility-scale renewable electricity generation, the processes and institutions that procure and finance it have often failed to include or benefit individuals and communities living in the national and local vicinity. This paper therefore sets two key competing objectives of renewable electricity generation in context: as a predictable, long-term revenue stream for investors, and as a mechanism for socio-economic development and community empowerment. Building on scholarship from human geography, development studies and sustainability transitions, my analysis takes forward understandings of the role of finance in utility-scale renewable electricity generation as a key aspect of the political economy of the energy transition. In exploring the evolution of renewable electricity as a new and rapidly emerging asset class I consider how its development is increasingly determined by the frameworks and logics of finance and investment. Drawing on examples from South Africa and Mexico, I address the following questions: What are the evolving configurations and processes of finance and investment in utility-scale renewable electricity generation? How have they been facilitated? And what tensions have arisen from their implementation at the national and local level
The Political Economy of South Africa’s Carbon Tax
The subject of carbon pricing is rising up the global policy agenda, as countries take action in the aftermath of the United Nations Framework Convention on Climate Change’s Conference of the Parties 26 summit in November 2021. South Africa is the only country in sub-Saharan Africa to have enacted a carbon tax to date, and, globally speaking, was ahead of the curve when it started to consider its implementation at the start of 2010. With a historically energy-intensive and carbon-intensive economy as a core feature of its minerals-energy complex, South Africa is the world’s 14th largest emitter of greenhouse gases, and the largest emitter on the continent. Its electricity grid is the world’s most carbon-intensive, and its primary energy consumption is ranked 17th globally. While the country’s gross domestic product is the 30th highest in the world, it is also one of the most unequal. It has a legacy of socioeconomic and political exclusion, and marginalisation created by the apartheid history that has persisted in the decades since the democratic transition in 1994. This paper asks to what extent and in what way has South Africa’s political economy shaped the process and implementation of its carbon tax? In answering this question, the report explores and analyses the design and implementation of the tax; the key criticisms to which it has been subjected; the effectiveness of the tax, not least in light of the considerable allowances and exemptions that have been included in its design; the relationship between the carbon tax and other existing climate change policies; and the potential relevance of South Africa’s experience for other countries on the continent
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Post-apartheid electricity policy and the emergence of South Africa's renewable energy sector
South Africa’s new renewable energy sector is uniquely embedded within the country’s electricity system and in turn its unique political economy. In this paper I firstly chart major developments in the country’s energy policy and governance since the end of apartheid in order to demonstrate how electricity policy is determined by social, economic, political, and technological factors. Secondly I examine the contested negotiation of key policies, which have been fundamental to the introduction of a renewable energy sector. Finally I consider how the new renewable energy sector has evolved thus far and raise key challenges and concerns for its future developmen
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