17 March 2008
In this time of electricity supply crisis, the reported (SABC, 17/03/08) construction delay of the Alcan smelter at Coega is to be welcomed as a first step towards a rationalised electricity supply and distribution system.
For over two years, Earthlife Africa Johannesburg has been campaigning against the sale of bulk electricity to Alcan at low tariff rates. In late 2006, the Government & Eskom signed a host of deals with Alcan under the Developmental Electricity Pricing Programme (DEPP). These deals ensured Alcan 1350MW of power (enough to run a small city) at low rates. The estimated special tariff for Alcan is 12c/kWh.
While the details of these deals remain secret—due to dubious confidentiality clauses within the DEPP policy—delaying construction of the proposed smelter gives the Government the time to scrap the DEPP. This will enable the Government to replace the DEPP with an open, transparent policy on industrial electricity supply that will ensure industrial customers meaningfully contribute towards paying for the expansion of Eskom’s generating capacity.
In particular, the time has come to ensure that Eskom increases the generation of electricity from renewable resources, in particular Concentrated Solar Thermal, and that the tariff system is brought into line with the new realities.
Earthlife Africa Jhb believes that as commodity prices rise over the next five years (oil, coal, natural gas, and uranium) and as South Africa comes under increasing pressure to cut CO2 emissions, South Africa will have to transition away from fossil fuels and towards renewable forms of energy.
Government policies like the DEPP prevent this. The underlying assumption behind the DEPP and the subsequent Alcan deal is that the Apartheid system of providing heavy industry with dirty, cheap electricity from coal-fired power stations is applicable in the 21st Century. This is not the case. South Africa cannot afford the Apartheid-style of electricity system under current global energy trends.
However, the converse is also true. South Africa can afford to invest heavily in an industrial plan to design and manufacture renewable energy technology. Only last week, the Centre for Renewable and Sustainable Energy Studies in the Western Cape announced the possibility of generating 10,000MW of electricity from wave power alone.
Our national resources should be invested in promoting this kind of research and development. Showering tax credits and cheap, polluting energy on foreign users in return for very few jobs is an economic model best left in the 1980s.
For more information, please contact:
Energy Policy Officer
Earthlife Africa-Johannesburg Branch
Tel: +27 11 339 3662
Fax: +27 11 339 3270
Cell: +27 84 250 2434