Although natural gas is about 60% cleaner than coal in terms of carbon dioxide emissions, it currently contributes only 1.5% of the country’s total primary energy needs. Even though the National Development Plan (NDP) aims to delink economic development from environmental decay and carbon-intensive energy, while promoting social advancement, there is still no natural gas-focused policy in place.
Strategic Fuel Fund South Africa corporate services GM Marion de Wet on Wednesday discussed the causality between a supportive policy and regulatory framework and the sustainable development of a South African natural gas economy at the South African Energy Efficiency Confederation (SAEEC) conference.
The Department of Energy’s objective is to increase the contribution of natural gas in the South African energy mix by 2030 in order to provide affordable energy services to all citizens and industries. This is aligned with the NDP goal to achieve a low-carbon economy by 2030 and reducing greenhouse-gas emissions.
De Wet said that, to consider the sustainable development of natural gas, cognisance needed to be taken of the economic, social and environmental aspects. She added that this would require government’s commitment to supportive policy and regulatory frameworks that stretched beyond the confines of the NDP and existing governance instruments.
“Government needs to play a facilitation role, imposing penalties and ensuring that development happens in an orderly and controlled manner. There are about 30 policies that impact on the value chain of natural gas, in addition to many international frameworks.
“We do not have a regulatory instrument that talks to natural gas specifically, which would need to change. For example, the Gas Act can be expanded to include natural gas as a competitor to liquid petroleum gas, while catering to the three sustainability pillars and minimising monopolies,” De Wet averred.
Currently, oil and gas falls under the governance of the Department of Mineral Resources, but there is a disconnect once elements thereof overlap with the departments of Energy and Environmental Affairs.
De Wet recommended that a government department be established to deal specifically with hydrocarbons, considering that energy’s contribution towards the country’s gross domestic product is about 15%, of which coal – as a hydrocarbon – contributes about 77%.
She said it is necessary to optimise the energy mix ratio to ensure the availability of affordable clean fuel, optimal energy efficiency, technology and skills transfer, job creation, energy independence and security of supply.
“Natural gas can compete as a primary energy carrier, along with solar, wind, nuclear and coal, as well as a secondary energy source, competing with LPG and other petroleum fuels.”
Copper Development Association Africa consultant Carel Ballack, meanwhile, said it was necessary to consider four factors for stimulating growth and ensuring sustainability of solar photovoltaic (PV) development in South Africa.
The four factors are regulation, skills availability, funding and continuity.
He pointed out that only 25 municipalities out of 277 are geared – in terms of policy and framework – to accept renewable energy installations. He said there is a disconnect in regions so far as adoption of standards are concerned.
Regarding continuity, Ballack said the Renewable Energy Independent Power Producer Procurement Programme has had solar PV projects approved in a certain bid window, and afterwards there was a standstill for solar PV installations, since government support was limited to that bid window.
Additionally, South Africa only has two solar panel manufacturing facilities in the country left, since three have closed down in the last few years.
Therefore, it is critical to move the solar PV industry forward, said Ballack, which could happen through transparency in utility processes by municipalities and available information that is accessible to business, to take advantage of solar PV opportunities.
Nonetheless, Ballack noted there is continued market growth expected for solar PV, with 200 MW of renewables currently being installed. The expected installed renewable energy capacity by 2025 is 1 127 MW and 4 027 MW by 2030, growing at an average 28% year-on-year.