GREENPEACE PRESENTATION TO NERSA PUBLIC HEARING INTO ESKOM TARIFF INCREASE
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GREENPEACE PRESENTATION TO NERSA PUBLIC HEARING INTO ESKOM TARIFF INCREASE 21 st January 2010 Nkopane Maphiri , Greenpeace Africa Jay Rutovitz , Institute for Sustainable Futures, University of Technology, Sydney. Broad areas to be covered Brief introduction to Greenpeace Africa

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GREENPEACE PRESENTATION TO NERSA PUBLIC HEARING INTO ESKOM TARIFF INCREASE

21st January 2010

NkopaneMaphiri, Greenpeace Africa

Jay Rutovitz, Institute for Sustainable Futures, University of Technology, Sydney


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  • Broad areas to be covered TARIFF INCREASE

  • Brief introduction to Greenpeace Africa

  • International and national context

  • Energy [R]evolution

  • Job creation from the Energy [R]evolution (preliminary results)

  • Policy imperatives


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Greenpeace exists because this fragile earth deserves a voice. It needs solutions. It needs change. It needs action.

  • Mission Statement

  • Greenpeace is an independent, global campaigning organisation that acts to change attitudes and behaviour, to protect and conserve the environment and to promote peace.


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  • Core Values voice. It needs solutions. It needs change. It needs action.

  • Independence

  • Non violence

  • Taking direct action

  • The power of acting together within South Africa


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  • International and national context voice. It needs solutions. It needs change. It needs action.

  • The reality of climate change continues to outstrip scientific

  • projections.

  • An increase in global temperature of more than 2ºC

  • will cause catastrophic, irreversible climate change.

  • Climate change is already causing 300 000 deaths a year

  • according to a report from Kofi Annan’s Global

  • Humanitarian Forum.


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  • International and national context voice. It needs solutions. It needs change. It needs action.

  • International negotiations are ongoing (most recently in

  • Copenhagen) to come up with a global agreement to tackle

  • climate change and reduce CO2 emissions post-Kyoto

  • Protocol.

  • South African energy policy operates within this context,

  • and the South African government has made an

  • international commitment to reach a 42% reduction in

  • projected emissions by 2025.

  • Therefore Eskom build plans must take account of the fact that there is a world-wide push to reduce emissions.


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Energy [R]evolution voice. It needs solutions. It needs change. It needs action.

South Africa is among the 15 countries with the highest CO2 emissions in the world. Greenpeace and the European Renewable Energy Council (EREC) have published the Energy [R]evolution, a low carbon energy scenario which would allow SA to:

Save money,

Create jobs, and

Maintain sustainable economic development without fuelling catastrophic climate change.

The Reference scenario is “Business as Usual”, and is the International Energy Agency 2007 projection.


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Energy [R]evolution - electricity generation voice. It needs solutions. It needs change. It needs action.


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Energy [R]evolution – renewable electricity voice. It needs solutions. It needs change. It needs action.

Renewable energy could provide up to 75% of SA’s electricity by 2050.

Investing in renewable technologies and energy efficiency would reduce CO2 emissions in 2050 by 328 million tons per year.


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Energy [R]evolution voice. It needs solutions. It needs change. It needs action.

Renewable energy is mature, ready and can be deployed on a large scale within 2 years or less. Proactive investment in renewable power and energy efficiency would mean:

A more diverse energy mix would decrease SA’s

dependency on a single energy source (coal), thereby

increasing energy security.

Energy efficiency is absolutely critical - it offers the simplest, easiest and most cost effective way to reduce greenhouse gas emissions and costs.


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  • Energy [R]evolution voice. It needs solutions. It needs change. It needs action.

    Coal and nuclear power need to be phased out.

    • Emissions from coal pose a real and present threat to people and the environment.

    • There is no role for nuclear power in the Energy [R]evolution because of the numerous safety threats,

    • and the fact that there is no solution to waste disposal. Nuclear energy is also very cost intensive.

    • Carbon capture and storage is unproven, and will deliver too little too late.


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Energy [R]evolution Jobs voice. It needs solutions. It needs change. It needs action.

Given the importance of securing energy jobs, and encouraging a just transition to green jobs, Greenpeace Africa commissioned the Energy [R]evolution jobs study which illustrates the benefits of moving towards clean energy and securing South Africa’s future as a champion for change.


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Energy [R]evolution Jobs voice. It needs solutions. It needs change. It needs action.

The Institute for Sustainable Futures (ISF), University of Technology Sydney, analysed the employment effects of the SA Energy [R]evolution for Greenpeace Africa.

Electricity sector jobs only.

Direct jobs only (does not include jobs in accommodation, catering, or from spending wages).

We included one scenario with enhanced renewable manufacturing and export to rest of Africa.

ISF also did analysis for global Energy [R]evolution.

Preliminary results


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Energy [R]evolution jobs - methodology voice. It needs solutions. It needs change. It needs action.

Employment factors (jobs per MW)

UNCERTAINTY

SA factors where possible, otherwise OECD factors + multiplier.

Adjustment for cost decline.

Energy efficiency job factor (only for the reduction in electricity consumption)

Includes a proportion of energy efficiency achieved by solar water heating


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Employment factors – key inputs voice. It needs solutions. It needs change. It needs action.

Construction jobs per MW capacity increase

O&M jobs per MW installed

Fuel jobs per GWh

For coal this means coal mining jobs per GWh

Local SA factors for

Coal mining

Coal construction

Coal, nuclear and hydro generation O&M

Solar water heating


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Employment factor - adjustment from OECD voice. It needs solutions. It needs change. It needs action.

Labour intensity tends to be higher in countries with lower GDP per capita.

One method: multiply OECD factors by the ratio of labour productivity* in SA to labour productivity in the OECD. This would mean multiplying by 4.6.

We used the weighted average of the ratio between local factors and OECD employment factors, which is 1.8.

Conservative approach.

* GDP per person employed


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Electricity sector jobs to 2030 voice. It needs solutions. It needs change. It needs action.(including coal exports)

140

120

Thousands

100

80

60

40

20

0

2010

2020

2030

2010

2020

2030

Reference [R]evolution


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The potential for enhanced manufacturing voice. It needs solutions. It needs change. It needs action.

Additional 26,300 jobs

Additional 22,000 jobs in renewable export

147,400 in total, 45% more than in the Reference scenario

Reference

[R]evolution

[R]evolutionenhanced manufacturing


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The Energy [R]evolution scenario creates voice. It needs solutions. It needs change. It needs action.64,000 new jobs in renewable energy between 2010 and 2030.

In electricity supply, the [R]evolution scenario creates 46,000 new jobs by 2030, compared to 29,000 in the Reference scenario.

There are 123,000 energy sector jobs by 2030 in the [R]evolution scenario, 20% more than the Reference scenario.

Energy [R]evolution jobs - results


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Policy Imperatives voice. It needs solutions. It needs change. It needs action.

In principle, Greenpeace Africa is not opposed to energy price increases, provided there are provisions to protect low income consumers.

However, Greenpeace Africa does oppose the tariff increase application made by Eskom as it stands. Instead, the proposed tariff increase MUST encapsulate the following principles:


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  • Policy Imperatives voice. It needs solutions. It needs change. It needs action.

  • The need to prepare SA for a low carbon future and quit our dependency on coal.

  • Eskom should ring-fence at least 50% of the proposed tariff increase for investments into renewable energy and energy efficiency.

  • Under no circumstances should the tariff increase go towards funding nuclear energy or more coal power after Medupi and Kusile.

  • There should be a pause between Medupi and Kusile to develop and build substantial renewable capacity.


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  • Policy Imperatives voice. It needs solutions. It needs change. It needs action.

  • Energy efficiency is the most cost effective way of meeting energy needs, and Eskom should be required to demonstrate there is no demand management or energy efficiency alternative before developing any further non-renewable capacity.

  • There should be a national program of providing energy efficiency packages, which should be free to low income consumers, and include efficient appliances, solar water heating, and insulation.


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  • Policy Imperatives voice. It needs solutions. It needs change. It needs action.

  • Eskom should introduce a universal stepped tariff for residential customers. The Free Basic Electricity should be provided as the first block, followed by charges designed to recoup costs. The FBE should be increased to 100 kWh per month.

  • The cost of providing FBE, the energy efficiency packages and renewable energy feed in tariff should be spread across all electricity consumers.

  • NERSA’s mandate should be extended to regulate the municipal tariffs.


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Conclusion voice. It needs solutions. It needs change. It needs action.

There is no doubt that South Africa’s energy costs are amongst the cheapest in the world, and there is a justifiable reason for predictable tariff hikes.

The energy price increase together with new policies and incentives should enable Eskom and the private sector to invest in renewable energy, stimulate the local renewable manufacturing industry, create 64,000 green jobs by 2030 and place South Africa in the enviable position of having the foresight to switch over to renewables and become a leading exporter into the new African market for renewables.


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This fragile earth deserves a voice. It needs solutions. It needs change. It needs action.

Thank You.

www.greenpeaceafrica.org