JSE-listed coal trader Thungela Resources CEO July Ndlovu says it has been a polarising year for the coal industry, with many opposing views on the commodity and the way forward for the industry.

For him, the “just transition” represents not simply a switch from fossil fuels to renewables for energy, but rather the ensuring of universal access to energy and bringing people and business alike into better existence, in a cost-effective manner.

“The just transition is so often focused on energy, rather than the socioeconomic transition that will be effected as a major industry shuts down. We must balance those competing issues. It is not to say emissions is not an important issue, but the issue goes beyond that.

“Unless we join up in an integrated way and do what is right holistically, we will have stop-starts to the just transition.”

Ndlovu admits that the coal industry is experiencing the devastating trend of major miners divesting from coal assets, but he also sees this as an opportunity for consolidation among existing players and emerging players to come on board.

He says the requirement for secure baseload energy supply will remain and, to this end, coal will remain important.

He also believes coal can add meaningful value in terms of environment, social and governance (ESG) aspects, particularly on the “S” factor.

Minerals Council South Africa CEO Roger Baxter agrees, highlighting that 33% of South Africa’s liquid fuels are derived from coal. Coal also supplies more than 70% of the country’s electricity; accounts for about R61-billion of exports; and is one of the country’s largest employers.

The coal mining industry also spent R24-billion on capital expenditure last year.

He acknowledges that a just energy transition must take place, but adds that it must consider coal’s critical economic contribution to the economy and communities.

Coal miner Seriti Resources CEO Mike Teke echoes the sentiment, stating that although majors such as South32 have left the South African coal industry, it poses an opportunity for South African investors who have not been exposed to this commodity.

Teke points out that, even with the Integrated Resources Plan’s goal of decreasing coal’s share in the energy mix, the country will still be left with some coal-fired power stations in the medium term.

He believes the coal-fired power stations should be managed responsibly, instead of having them shut down, if South Africa is to industrialise.

Teke notes the importance of putting ESG at the frontline of skills development and other initiatives, to show the world what value the industry can add. He also stresses the importance of improving the safety of the sector using technology and operating as responsibly as possible.

Petrochemicals group Sasol Mining senior VP Lucky Kgatle says South African entrepreneurs can rewrite the story of coal in such a way that it speaks to an inclusive mining industry – involving collaboration between workers, government, communities and civil society in the creation of solutions.

He notes that Sasol will not exit coal, but pursue it in a sustainable manner, including by focusing on energy efficiency and reducing emissions.

For him, renewable energy has its intermittency issues that need solving, for which coal poses a solution. Additionally, he laments the reality of South Africa’s high unemployment rate, which makes “switching off coal” much more complex.

He agrees with Teke that South African coal miners need to put responsibility at the heart of their operations, in terms of the environment and safety.

The speakers participated in a panel hosted during the Coal Industry Day 2021 conference on July 27.