South Africa has for decades relied on coal to generate its electricity. The country's transition plan will cost billions and put jobs at risk. But is there a light at the end of the tunnel?
As this year's COP28 slowly draws to a close, world leaders have gathered in Dubai to deliberate over climate issues. This includes an eventual end to the burning of fossil fuels.
Now South Africa finds itself under pressure to begin a phase-out of its almost 100% reliance on coal for generating energy. It is estimated that this will come at a huge cost, including the loss of jobs.
President Cyril Ramaphosa recently delivered the country's so-called "Just Energy Transition Implementation Plan" , which has an estimated cost of €24 billion ($25 billion) to be spread across solar, wind and battery storage projects.
The plan outlines exactly how South Africa will reduce its dependence on coal, acquire new sources of renewable energy and build new industries and jobs for affected communities and workers.
However, President Ramaphosa told reporters on the sidelines of the climate change summit that South Africa would require external help to afford it.
"We are calling for more countries to participate as our energy transition requires much more money, so that we can transit in a much more effective way and in a just way, particularly when it comes to those communities that are going to be affected." Ramaphosa said.
Job losses expected
South Africa's plan to scale down its use of coal comes at a significant cost to its labor market.
A significant portion of the economy of Mpumalanga province in the country's east relies on coal mining and coal power stations. Removing coal from the equation effectively means Mpumalanga's economy will need to be reconstructed.
The country's car assembly plants will also require billions of euros of investment to make the switch to electric car production.
With the implementation of the plan looming, labor unions are now scrambling to secure the futures of their workers. Phakamile Hlubi-Majola, the spokesperson of the National Union of Metalworkers of South Africa told DW they want full guarantees that the implementation of the plan will protect livelihoods.
"The process should benefit the maximum number of people in the country," he said.
"It should protect the maximum number of jobs."
However, Leo Roberts from the think tank E3G said South Africa's entire economy is being dragged down by an "over-reliance" on ageing coal plants.
"Coal power isn't providing reliable electricity, there are rolling blackouts," he said.
"It's incredibly expensive and the state utility that runs the power system Eskom is so debt-saddled that it can't borrow money."
The country's power utility Eskom is currently struggling to generate enough electricity for the country. Eskom, which currently employs around 30,000 workers, would need to retrain many of them in order to remain relevant in the renewable energy sector.
Between a rock and a hard place
Energy analyst Adil Nchabeleng says South Africa's energy conundrum has left it between a rock and a hard place, adding that its pledges at COP28 are still going to clash with its existing energy situation.
"We are a coal-based country that specializes in coal-fired power stations and we need to make sure that those power stations will carry us to the next 20 years minimum and make sure that we produce electricity that we require," he said.
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But in the long run, the South African government sees light at the end of the tunnel. Concession loans and grant pledges made by international partners to support the transition phase now stand at just over €10 billion.
While the energy transition plan is expected to shed up to 300,000 jobs, the government says it is expected to create up to 815,000 jobs by 2050.
This article has been adapted by Okeri Ngutjinazo from a report on DW's AfricaLink, a daily podcast packed with news, politics, culture and more. You can listen and follow AfricaLink wherever you get your podcasts
Edited by: Ineke Mules
