The presidential climate commission has warned that South Africa is at risk of missing its emissions target deadline amid delays to the phase-out of coal-fired power generation. (Getty Images)
Delaying the decommissioning of the Hendrina, Grootevlei and Camden power stations could cost Eskom up to R90 billion, according to Dan Malocane, chief executive officer of state-owned Eskom.
Malokane briefed the Presidential Climate Committee (PCC) on Friday morning about Eskom's decision to keep its three oldest coal-fired power stations running until 2030, later than originally planned for retirement.
Malokane said Eskom expects revenue from continuing to operate the plants – about R102 billion – will offset the extra costs to the utility.
Malokane emphasised that the postponement of decommissioning was in the interest of energy security, saying: “As Eskom, in considering plans to decommission the station, we had to take into account the realities and threats that remain in terms of load shedding.”
Malokane said Eskom would continually reassess the decommissioning schedule approved by its board.
Eskom's decision to maintain electricity supply in Hendrina, Grootvlei and Camden has become a bone of contention between the PCC and power utility Eskom, which on Friday released the first-ever assessment of South Africa's climate change response.
The report on the state of climate action says there is hope South Africa can meet its Nationally Determined Contribution (NDC) emissions target by 2030, but delays in decommissioning could hinder plans.
The report cites the government's draft sectoral emissions targets report, which was released for public comment in April, and notes that the 2030 NDC target may not be met if key policies such as the original phase-out plan are not met.
Commissioners grilled Malokane about Eskom's decision, questioning whether future demand for the power utility justifies keeping the plant running until 2030 in the context of increasing investment in renewable energy. They also questioned the cost to people's health.
Last October, the Energy and Clean Air Research Centre published a report predicting that delaying the retirement of power plants beyond 2030 could result in 15,300 additional air pollution-related deaths. The total economic losses, it predicted, could be around R345 billion.
To ease concerns about the climate-related impacts of the delays, Malokane said the three plants utilised far more advanced emissions technology than Eskom's other plants.
The main conclusion of the report on the state of climate action is that despite strong determination to tackle climate change, progress is not being made at the pace and scale needed.
“Major obstacles to progress include inconsistent policies, weak governance structures, inadequate funding and inconsistent action by governments and other stakeholders,” the report said.
The report noted that of the 95 actions outlined in the National Climate Change Adaptation Strategy, only 28 are listed as fully implemented or in the process of being implemented.
The report said climate action was plagued by contradictory official positions, including on phasing out coal power, and that the government was “grappling with urgent trade-offs between energy security, economic growth, the health impacts of fossil fuel pollution and climate action.”
The report also warned about limited investment in a just transition, noting that tracked annual climate finance averaged R131 billion per year from 2019 to 2021. While this is the highest on record, it is still far from the estimated average annual need of R334 billion to R535 billion.