Committee on Electricity Warns Against Job Losses as a Result of Just Energy Transition Plan

The Portfolio Committee on Electricity and Energy expressed its concern over potential job losses as a result of the Just Energy Transition (JET) plan when it received a briefing from Eskom on the revised plan, decoupled from the decommissioning of plants.

The Eskom JET strategy has been decoupled from the decommissioning schedule to ensure independence from plant operations. Eskom’s plan promotes the optimal use of the existing coal fleet while rolling out clean energy capacity to ensure security of supply and energy sustainability.

The committee engaged with the power utility on its R400 billion debt burden along with limited government support, as the fiscus cannot keep funding Eskom in the way it has in the past. Also, due to the inflated cost of electricity, the entity has declining energy sales, escalating municipal debt and less than cost-reflective tariffs.

The committee demanded an explanation from Eskom on how it plans to secure the substantial assistance and sustained funding required for the entire JET, including the estimated R257 billion for a minimum emission standards compliance and the 14,000 km of grid expansion needed by 2034.

Eskom said that it has a commitment to reduce emissions by 40% by 2030. Regarding minimisation of any disruption that might occur, Eskom said that the transition not only includes sustainability but also energy security and affordability.

The power utility stated that in its communication, it has been indicating that coal is not an issue. But to manage the transition, the entity uses technology to make it safe to reduce emissions. The committee heard that Eskom will not shut down coal-powered stations for the sake of shutdown and disrupt the economy but, where it is possible, coal will be used as optimally and efficiently as possible within the ambit of the commitments made.

Regarding the strategies that are being implemented to mitigate the risks of funding delays and the impact of the US withdrawal from the International Partners Group, Eskom said the dynamics and changes from the US have changed how the power entity traditionally views funding. However, Eskom believes that change comes with opportunity.

Eskom told the committee that the entity also engaged with the World Bank to source funding from various international funders. The committee heard that funders are aware of their five-year project from the discussions already undertaken.

Regarding job losses due to the closure of the coal power stations and the JET plan, Eskom told the committee that it wants to grow the economy on all fronts, while continuously using all the available resources to meet emission targets. The committee noted the difficulties arising from the decommissioning of power stations, which include job losses and economic and social impacts.

The committee expressed its appreciation to Eskom for stabilising the grid and avoiding loadshedding for a sustained period. The committee told Eskom that nuclear energy is probably the safest and cleanest energy source available. Members of the committee advised Eskom about the possibility of considering the new technology of using nuclear waste stored at fire pits for generating electricity.

Distributed by APO Group on behalf of Republic of South Africa: The Parliament.