SA needs to move fast to access Spain's €2.1bn grid and transmission line JET aid package
In an over lunch meeting I had with the Ambassador HE Raimundo Robredo accompanied by Ana María Martinez and Fernando de Castro of the Spanish Embassy in South Africa, we had an interesting, yet intense, debate over European foreign policy, particularly on energy in Africa.
Reflecting on the successes and setbacks experienced by Spain when it transitioned away from reliance on fossil fuels, Robredo related his experience of growing up in a coal region of Spain. He painted a rosy picture. Today coal mining in Spain has ceased almost completely and now his region is a tourist destination.
A report produced by World Resource Institute titled, Spain’s National Strategy to Transition Coal-Dependent Communities, on December 23, 2021, said:
“Since 2010, EU legislation has been a major driver of Spain’s coal mines closures: Decision 2010/787/EU called for Member States to cease financial support to uncompetitive coal mines, and close them by December 31, 2018. The share of coal in Spain’s power generation fell from 40% in 1990 to 5% in 2019 (most of which is imported), and employment in the coal mining sector went from more than 45000 in 1990, to 3400 in 2012, to 1700 in 2017 (plus additional contract workers and employees of coal-fired power plants).
“Mining towns are already struggling due to the industry’s gradual decline, with depopulation rates as high as 40%. Because of their rural nature and lack of a diversely skilled workforce, these areas struggle to attract new enterprises. Strong local coalitions have emerged to slow or stop mine closures, including workers, unions, municipal governments and businesses indirectly supported by the coal industry, and they have hindered successive plans to close coal mines over past decades. Job losses are of particular concern for Spain, because even before the Covid-19 pandemic, its unemployment rate was double the EU average”, the report said.
The just energy transition produced devastating effects on the economy of Spain, the most hard hit being the mining towns, which lost an immense amount of jobs to attain the EU’s goals and commitment to climate-neutrality by 2050.
Spain’s Just Energy Transition plan imposed by the EU was pursued intensely by Spain from 2010 due to the EU legislation policies, which was a major driver of the transition.
The Ambassador, still holds a view that JET is not a forced policy on EU member states, it is voluntary.
However, we know that EU member states in the European Union face a backlash if they fail to reduce and shutdown carbon intense industrial sectors.
I personally don’t agree with shutting of the coal power sector, but I respect the Ambassador’s views.
This as Spain aims to invest in supporting South Africa's efforts towards grid expansion and the building of an extended 14000 km of transmission lines to connect the currently distressed renewables assets that are not as yet connected to the grid. Spain also plans to invest in the technology required to integrate and harmonise renewable energy into South Africa’s high frequency transmission infrastructure.
For that to happen Spain is planning to use its €2.1 billion (R41bn) grid and transmission line support JET aid package to (help) South Africa to unlock, and integrate currently isolated energy generation infrastructure sitting in remote locations unconnected to the grid.
The only challenge I foresee is that the South African government will miss out on this funding package due to bureaucratic red-tape, that slows down the process of acquiring and onboarding such funding opportunities to boost economic growth and development in South Africa.
What needs to happen is that the Minister of Electricity and Energy Minister Kgosientso Ramokgopa together with DIRCO Minister Ronald Lamola should urgently meet with the Embassy of Spain and unlock this fund, which is sitting idle with Spain and unused at the moment.
JET:
The cause behind South Africa’s energy crisis and load shedding which paralysed the economy was due to the rushed implementation of the overzealous JET policies.
In hindsight, looking back at the cause and effect behind the collapse of Eskom plant maintenance and repairs program on its energy generation plants was purely a policy failure issue.
Eskom's overall baseload generation capacity factor was badly hit and affected, and in essence that was the main problem that Eskom had to battle with the huge levels of unplanned capacity load factor (UCLF) generally referred to as unit breakdowns. Most of the broken down plants were sitting idle and broken down and not fixed or repaired for months on end. That in turn caused higher levels of breakdowns and lower availability of generation capacity levels, which worsened levels of load shedding.
The previous Eskom executives who led the power utility during that difficult energy crisis period decided to rather focus on solving load shedding through reliance on external renewable power producers mitigation strategies. That in itself was a grave mistake.
Anger over the crises of load shedding and mismanagement of Eskom deepened socio-economic problems and led to the ANC losing the majority vote in elections.
The JET plan was and still is overly ambitious. To try to force countries to fast track renewables without adequate infrastructure to perform far more energy intensive requirements is madness. This as the technology available for JET is in small modular scale solutions more suitable to power a house and light up factory and semi commercial and industrial lighting requirements, than power a base-load intensive economy.
This as Europe faces prohibitively high electricity costs to pay for renewables that has been recently cited by VW as part of the reason why it is shutting down its German factories.
So why are Europe and the West so intent on forcing Africa to transition away from fossil fuels and move towards adopting and relying on renewable energy technology?
The answer is so simple it is pure foreign policy hypocrisy. Europe and the West haven't transitioned away from the use and reliance on fossil fuels. They are heavily reliant on baseload energy and industrial use of fuels and gas-based hydrocarbons for their heating and industrial processing facilities and industrialisation.
Europe and the West have been doubling down on consuming far greater quantities of non-renewable energy ever since the breakout of war between Ukraine and Russia.
My conclusion is that Africa is highly misunderstood by Europe. Somehow the view of Europeans reading Africans is that we are incapable of self -government and without aid the continent will struggle to grow and prosper. But what the West and EU leaders fail to realise is that Africans are tired of being spoken down by Europe and the West on what to do with their economic sovereignty..
It is the wish of most African states to see a day when the continent will be free from European and Western policy domination that dictates terms in almost all policy fronts that they advance towards Africa. The carrot and a stick approach towards development must end. Allow Africa to grow and prosper without hindrance.
Crown Prince Adil Nchabeleng is president of Transform RSA and an independent energy expert.
* The views in this column are independent of Business Report and Independent Media.
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