ESG

Coal still significant as SA miners develop net zero action plan

MCSA seeks a "just" energy transition

Staff reporter
 Coal is a major source of electricity in South Africa, according to the minerals council

Coal is a major source of electricity in South Africa, according to the minerals council

Its comments followed all 28 members of the International Council of Mining and Metals last week signing an open letter pledging net zero on scope one and two emissions by 2050.

The Minerals Council South Africa said it was developing a Net Zero 2050 Action Plan and warned a "just transition" must support greater investment in renewable energy over time without compromising energy security.

The country's miners were impacted by extreme power outages almost two years ago and state-owned utility Eskom is continuing to schedule load shedding or controlled power disruption to lower demand.

More than 70% of South Africa's electricity demand is generated from coal power, according to the council.

It said its action plan would include increasing investment in renewable energy, ongoing adoption of modern mining methods and a "realistic" just energy transition.

It had also looked at the opportunities of a green hydrogen economy and was considering setting up a leadership forum to progress this agenda.

"The minerals council emphasises the criticality of a pragmatic and people-centred just energy transition that recognises South Africa's dependency on a reliable energy supply that is crucial for development and inclusive growth, and the significant employment and economic value created in the coal value chain," the council said last week.

It was working closely with its coal members who were "fully supportive of the people-centred and pragmatic just energy transition", it said.

"While the share of coal will decline over time, it will remain a significant provider of baseload electricity, employment, exports and contributor to the economy over future decades," the council said.

Over the next 10 years, it said some 11GW of old-generation coal-fired power stations would need to be retired and the energy mix would require much greater investment in renewables.

Its members had already targeted investment in 1.6GW in renewables in the next three years, the council said.

Meanwhile China's energy crisis is pushing up thermal coal prices but could spark greater investment in renewables, according to Wood Mackenzie Asia Pacific vice chair Gavin Thompson.

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