Quantifying the Potential of Restored Natural Capital to Alleviate Poverty and Help Conserve Nature: A Case Study from South Africa

Abstract not available.

South Africa's Electricity Consumption: A Sectoral Decomposition Analysis

South Africa's electricity consumption has increased sharply since the early 1990s. Here we conduct a sectoral decomposition analysis of the electricity consumption for the period 1993 to 2006, to determine the main drivers of this increase. The results show that the increase was due mainly to output- or production-related factors, with structural changes playing a secondary role. While there is some evidence of efficiency improvements, indicated here as a slowdown in the rate of increase in electricity intensity, it was not nearly sufficient to onset the combined production and structural effects that propelled electricity consumption higher.

Is Water Shedding Next?

South Africa is in the grip of an electricity crisis marked by a euphemism known as “load shedding”. The demand for electricity has grown to the point that the supply reserve margin is often under threat, necessitating the electricity supplier to cut supply to some areas for various periods of time, or to shed load. This is a condition previously unknown to South Africa since the country has enjoyed electricity security from the mid-1950s. Are we, however, heading in the same direction when considering water? Is water shedding inevitable? We ask these questions since South Africa is a country classified has having chronic water shortages, a condition exacerbated by climate change and the rapidly increasing demand for water. Can we avert a water shedding crisis by being proactive? In this paper we address this issue by applying a Computable General Equilibrium (CGE) model using an integrated database comprising South Africa’s Social Accounting Matrix (SAM) and sectoral water use balances. We refer to AsgiSA, the governments’ Accelerated and Shared Growth Initiative in South Africa, and conclude that continuing business as usual will indeed lead to a situation where water shedding will be inevitable. Unlike electricity, however, water security is much more serious from livelihood, health and socio-economic development perspectives since there are no substitutes for it, although its influence is not directly and immediately visible. This delayed effect can create a degree of comfort and ill-founded complacency leading to non-action, whereas there is an urgent need for proactive measures.

Electricity Intensities of the OECD and South Africa: A Comparison

Improving a country’s electricity efficiency is considered one of the important ways to reduce its greenhouse gas emissions and to meet its commitments concerning climate change mitigation. In this paper, we conduct a comparative analysis between South Africa and OECD members’ total and sectoral electricity intensities. This is done to establish a sense of South Africa’s relative performance in this regard, to ascertain the possible scope for improvement and, if such scope exists, to determine in which of the industrial sectors.

On the Real Exchange Rate Effects of Higher Electricity Prices in South Africa

The paper uses a static Computable General Equilibrium (CGE) model of South Africa and simulates various shocks to the price of electricity. We attempt di¤erent closures to the model and compare their respective e¤ects on the Consumer Price Index. In a CGE model, this is measuring the real appreciation of the exchange rate, or international trade competitiveness. In general, we conclude that electricity prices per se does not signi?cantly in?uence the real exchange rate, regardless of which closure is used.

On the Real Exchange Rate Effects of Higher Electricity Prices in South Africa

The paper uses a static Computable General Equilibrium (CGE) model of South Africa and simulates various shocks to the price of electricity. We attempt different closures to the model and compare their respective effects on the Consumer Price Index. In a CGE model, this is measuring the real appreciation of the exchange rate, or international trade competitiveness. In general, we conclude that electricity prices per se does not significantly influence the real exchange rate, regardless of which closure is used.

Predator–prey analysis using system dynamics: An application to the steel industry

In this paper, we use a predator–prey model to simulate intersectoral dynamics, with the global steel sector as the prey that supplies inputs and the automotive sector as the predator that demands its inputs. A further prey, an additional upstream supply sector, namely the iron ore sector, is added to reflect the implications of scarcity and resource limitations for industrial development and economic prospects. We find that capacity constraints in the steel industry could limit the future supply of vehicles, a result exacerbated by the unsustainable use of iron ore reserves. The solution is not for marginal steel industries to close, but for steelmakers to adapt and move to less resource-demanding secondary steelmaking technology rather than focusing on primary steelmaking. The forecasting capabilities of the model are compared with the outputs from a neural-network model. Although the results are comparable over the short term (±10 years), over the long term, results diverge, showing that forecasting steel-industry dynamics is complex and that further work is required to disentangle the drivers of supply and demand. This study indicates the potential advantages of using predator–prey models in modelling the supply chain in economics.http://www.sajems.org/am2016Economic

Climate change: The opportunity cost of Medupi and Kusile power stations

Eskom has embarked on the construction of two coal-fired power stations (Medupi and Kusile) that use a new dry-cooling process with flue gas desulphurisation (FGD). While the introduction of these new technologies does have meaningful environmental benefits beyond the conventional coal-fired power stations, they still emit greenhouse gasses. The question at stake here is what is the opportunity cost, viewed from a climate change perspective, of these two new power stations? This question is answered by considering the carbon footprint of the two power stations and a range of unit values for CO2. From this analysis, it is evident that the most likely range of the opportunity cost is between R6.3 billion and R10.7 billion per year. This converts to a damage cost of between R0.10 and R0.17/kWh when assuming a net combined generation capacity of 8 677 MW and a load factor of 85%

Value Chain-Induced Constraints Limiting Scale of Conservation Agriculture in South Africa

The potential of scaling conservation agriculture (CA), for long-term food security, remains under-investigated within the context of agricultural food value chains in South Africa. To scale the use of CA an understanding of the current agricultural value chains, their functioning, regulatory framework and constraints, is essential and this raises a key question: What are the main shortfalls and deterrents in agricultural value chains and why might CA be faced with challenges to feed into these existing structures, through which it could, the hopes are, create a more inclusive and sustainable farming system for long-term food security? The empirical data from an ethnographic qualitative participant research showed that interviewed value chain participants (VCP) are limited in acting on account of their economic constraints. None of them had products that supported CA, while financial institutions argued that such products would not be necessary, as any risk mitigating farming system would, in any event, result in financial benefits to the farmer

The Struggles of Smallholder Farmers: A Cause of Modern Agricultural Value Chains in South Africa

The potential of sustaining smallholder farmers (SHFs), for long-term food security remains, within the context of rising modern food value chains, particularly in Africa, a threat. Support for a greener, lower carbon economy that creates jobs and improves human well-being as part of a sustainable and socially inclusive stable economic development should be driven, at least in part, by SHF