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Dynamics of the local energy market and JUST transition
Dynamics of the local energy market and
JUST transition
By Aradhna Pandarum, Research Group Leader at the CSIR
The inclusivity of SMMEs and empowering them with knowledge of new energy resources and capability is key.
My passion for the energy transition space has its roots in touching lives through innovation. Developing new capabilities and innovation platforms to meet local energy transition objectives is an agenda priority for me and for the global energy industry.
Collaboration and innovation are key to rapidly producing better and more efficient designs. By adopting engineering simulation and test solutions, energy businesses can accelerate development turnaround time and output levels.
Effective relevant energy transition mechanisms ensure that the selected, resilient low-carbon energy technology streams not only address current energy shortages, but also contribute to a just society by improving the country’s employment rate, economic growth and inclusiveness.
The current business challenge is a global one and is brought about by climate change with the increasing need to reduce greenhouse gas (GHG) emissions. According to a report published in 2021 by Bloomberg, South Africa is the 12th largest source of GHG emissions globally.
Almost half of these emissions emanate from the electricity sector. It is, therefore, prudent for us as a country to transition to low-carbon energy technologies and in doing so, ensure accurate relevant analyses of all contributing streams to this dilemma so that swift mitigation of risk responses can be factored in.
The energy transition is not a new concept; it is loaded with novel technologies being introduced at an unprecedented scale, impacting and affecting pathways that have a direct effect on environmental, social and economic indexes.
Techno-economics have always been central to the investment and implementation of large infrastructure for any successful energy technology platform. However, social justice facets such as job creation, enterprise development, community participation, upskilling, reskilling, skills development and impact on health and overall livelihood are pivotal to ensuring that the energy transition is just.
Time is right for local pioneering
The time is right for local pioneering, especially after the impacts of Covid-19. The correct and attuned implementation of relevant solutions will be beneficial in alluring energy industry support programmes that will echo an expository narrative, showcasing insights into the local success of energy transition. Current market challenges in the energy space include: • Job losses from the coal sector due to lack of upskilling or reskilling. • Salary and job description implications created by low-carbon technologies, including renewables and green hydrogen. • The holistic social impact (and how to best determine the impact) of decommissioning coal-fired power stations and using the correct risk mitigation solutions that can be used to address these impacts. • The current inability to ensure and quantify inclusivity, enterprise development and increased economic growth, including unforeseen delays in the procurement processes to purchase new energy technologies.
A solution? Enterprise development through empowering SMMEs in the energy sector
These are but a few challenges, however, a solution on the table is to expedite the energy transition process, whilst ensuring social justice imperatives, by directly addressing enterprise development through empowering small, medium and micro enterprises (SMMEs) in the energy sector.
An injection of astute acumen into a plethora of energy transition opportunities is available to them coupled with technical expertise that will certainly act as a resilient springboard for SMMEs on this exciting low-carbon energy journey. I am confident that this intuitive intervention will ensure significant economic growth. SMMEs employ 50-60% of the South African workforce and SMME inclusion will have an impact on reducing unemployment.
Unbeknown to many stakeholders, policy recommendations and alterations are continuously explored behind closed doors with the chief intent to drive economic growth and sustainability. SMMEs are not privy to this crucial information and are generally unaware of the opportunities being created and available to them.
An analysis conducted by the CSIR in Pretoria concluded that by 2030, 46 219 jobs will be lost by the decommissioning of coal-fired power stations, but the implementation of the energy technologies in the integrated resource plan will create 34 997 jobs (indirectly and directly).
This indicates that the resulting electricity sector will not be enough to make up for all jobs that are lost, let alone cater to market-related salaries at that time. Other economic diversification options cannot be ignored and must be explored speedily. Therefore, SMME empowering SMME differentiation through patents and collaborations are critical to significant changes within the energy transition space.
Aradhna Pandarum is a registered professional engineer and an internationally esteemed researcher with a demonstrated history of working in the utility industry. Skilled in renewable energy, power system design, power flow simulations, electronics, energy economics and power quality. Currently working on and managing research on all aspects of a Just Energy Transition in South Africa.
Pandarum has a bachelor’s degree in Electronic Engineering from Howard College University of KwaZulu-Natal and a master’s degree in Electrical Engineering (Renewable Energy) from the University of the Witwatersrand.
