Is South Africa Finally Switching To Gas Power?

Power failures have become the bane of existence for many South Africans. With new levels of load shedding introduced monthly and the price of electricity increasing sporadically, it’s no surprise that the country wants to switch to more sustainable sources of electricity.  

There’s been much chatter and behind-the-scenes moves indicating that South Africa is trying to get away from using coal (which generates more than 80% of our electricity) and switch to the world’s 12th-biggest source of greenhouse gas.  

A large portion of South Africa’s power stations are at the end of their lifespans, hence all the country’s issues with electricity supply. Around 1,000 megawatts of capacity will be decommissioned yearly over the following decade, which presents an optimal opportunity to start updating the energy framework. The only question is how. 

The government hopes to cut emissions to net-zero by 2050. Its energy blueprint imagines the development of scores of solar-based and wind-controlled plants. However, there are widespread doubts that those tasks can happen fast enough, or be reliable, to replace coal fully. Plans to use natural gasses to deliver roughly a fourth of 12,000MW of extra power by 2030 are fervently challenged. The fuel produces less than 50% of the greenhouse gases that coal does; however, replacing the dirtiest fossil fuel with a cleaner one will make South Africa’s emissions target hard to meet.  

Not to mention that financing the gas-fired plants may also be a difficult challenge to overcome. A few development finance establishments, which are vital funders of numerous energy projects in Africa, are revising their investment mandates to leave out the fuel. South Africa might need to depend on organizations like General Electric Co and Exxon Mobil Corp that have communicated interest in developing the new gas projects.  

In March, the government chose Turkey’s Karpowership as a favoured bidder to supply about 1,220MW of electricity from gas-fired floating power stations, an agreement worth an expected $16 billion over twenty years.¬†Although, the organization’s ecological license applications have been rejected amid resistance from natural activists. So it’s difficult to say where that leaves South Africa in terms of financing this grand venture.¬†

We know that South Africa currently imports gas from Mozambique through pipelines and fuel lines operated by Sasol Ltd. South Africa is also hoping to produce its own gas soon. Until then, we’ll have to wait and see.