Energy Choices

Author: Compilation, with input from Dr Eureta Rosenberg, Claire

( Article Type: Sustainable Development )

Energy is one of the most fundamental requirements of modern society. We rely heavily on energy for our individual domestic and business needs and for the country's economic development.

The availability of abundant, cheap power in the form of fossil fuels has enabled the development of machines and systems that enhance the quality of life and increase efficiency and productivity. In fact, energy availability is often the difference between a 'developed' and 'underdeveloped' context. However, the manner in which we obtain and use energy has caused a considerable amount of damage.

There are many social, health, environmental impacts and costs that have not been acknowledged or paid for by those who have used energy or profited from energy supply. Concerns are therefore growing about the impacts of the consumption of fossil fuels, including:

•  air pollution
• climate change
• waste-disposal problems
• land degradation and
• the depletion of natural resources.

Furthermore, cheap supplies of oil appear to be running out. These trends are likely to continue and even accelerate throughout the 21st Century.

To address these concerns, attention is being focused on ways of saving energy in both supply and use. We now need to make more carefully considered choices as to how we produce and use energy in the future.

Reducing Energy Use 

There are many opportunities to reduce the amount of energy we use. Reductions will benefit our environment and society and will also provide cost savings to individuals or organisations that make the effort to reduce energy usage.

Energy Efficiency:  

•  is recognised as one of the most cost-effective ways of moving towards sustainable development. 
• is cost effective. The majority of interventions will involve no cost or low cost with a payback period within five years. 
• helps improve competitiveness in industry. It has been demonstrated that one of the most cost-effective ways of maximising commercial profitability is the adoption of appropriate energy efficiency measures. 
• is one of the most cost effective methods of reducing Greenhouse Gas emissions, thereby combating global warming and climate change. 
• can save water, since power stations use two litres of water for every unit of electricity (kWh) generated. 

For handy tips on how to reduce your energy usage, see the Enviropaedia's Eco-Logical Living Guide. 

Electricity in South Africa

The South African electricity sector is the largest in Africa, representing about 45% of total electricity consumed on the continent. State-owned Eskom, the national utility, is one of the world's largest electricity utilities. In 2008, it ranked thirteenth in the world by generation capacity.

Beginning with the recommendations of the De Villiers Commission in 1983, through to a series of Conversion Acts in 1987 and thereafter, Eskom has been transformed from a public utility having a remit to ensure electricity provision 'in the public interest' (albeit that 'public' was defined in narrow apartheid terms), to a corporation with a mandate to 'realise shareholder value' for its sole shareholder, the State.

As a corporation with a commercial remit, Eskom is active in electricity supply and management in other parts of Africa, through its subsidiary Eskom Enterprise.

Electricity sales are an important source of revenue for municipalities that helps them to provide public services to citizens, as they add a surcharge to the electricity they buy from Eskom and then sell to consumers.

In physical energy supply and consumption terms, the South African electricity system is dominated by a core of a few major participants. By virtue of their position in this physical energy supply and consumption system, this core has developed significant financial, technical and organisational resources, through which it exerts significant influence on governance of the system.

Challenges in the Electricity Sector 

A key challenge for governance of this sector is balancing the interests of the core players as identified above, with other less well represented groups and interests, including those of citizens who need access to clean, reliable and affordable electricity in order to ensure that decisions are made in the broader public interest.

Additional contextual factors in the sector relate to failures or weaknesses in policy and regulatory processes, for example:

• An electricity supply crisis, starting in early 2008, with features such as widespread blackouts, loadshedding and mandatory limits on supply, leading to disruption, significant economic damage and loss of confidence in national governance. Ongoing national reserve margin problems with associated severe security of supply risks are expected for years to come. 
• The National Energy Regulator of South Africa -NERSA's espoused tariff philosophy is 'centred on price stability and predictability in the interests of the customers', yet high average price increases have been implemented, indicating ongoing difficulties in adhering to central tenets of the philosophy. 
• The Integrated National Electrification Programme, which during the first years of democratic government was comparatively one of the most successful in the world, shows signs of significant slowing and increasing disconnection rates, the latter arguably due in part to unaffordability. Comprehensive and detailed statistics for this trend are disappointingly unavailable, as it bears the potential to undermine the social achievements of the electrification programme with severe welfare impacts for poor South African.  

The electricity supply industry (ESI) has undergone considerable reforms over the past two decades, although Eskom remains a de facto traditional public monopoly.

The political settlement in 1994 enshrined in the 1996 Constitution granted rights and responsibilities to the three spheres of government, including confirmation of the right of local government to supply electricity to customers within their areas of jurisdiction. The organisation of the distribution industry is the result of the takeover of failing local and regional distributors by Eskom in the early 1990s, during the transition from apartheid, and the restructuring of local authorities in the late 1990s. Since then there has been a highly contested process of attempted restructuring of distribution systems, which is ongoing.

Recent developments 

•  Integrated Resource Plan 2010-2030 (IRP2) promulgated ' a ZAR800 billion investment plan in new electricity generation in addition to all existing power plants (which includes 10 GW committed coal), the plan includes a further: 9,6 GW of nuclear; 6,3 GW of coal; 17,8 GW of renewables; and 8,9 GW of other generation sources, i.e. a 52.6 GW new build programme. (See South African DOE website for details) 
• A Suite of Supply Policy Guidelines for the Integrated National Electrification Programme was developed in 2012/13. 
• Medupi and Kusile power stations (4,800 MW each) under construction. US$ 3.2Bn World Bank loan extended for Medupi but Kusile not fully funded (ditto the IRP2).