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Government Secrecy over Coal-Plant Decommissioning Report

1 November 2023 at 11:13 am

DATE: 1 November 2023

Cape Town- Civil society is concerned about National Treasury’s delay in releasing crucial information relevant to the future of coal-fired power plants in South Africa. Treasury announced in February this year that it had commissioned an independent review of Eskom’s 14 coal-fired power plants and that the review would be concluded by mid-2023. However, it has still not released the outcomes of the review, which was undertaken by an international energy consortium led by the vgbe energy association.

In February, National Treasury indicated that the association was appointed to “review all plants in Eskom’s coal fleet and advise on operational improvements” and that this assessment would “include a determination of which plants can be resuscitated to original equipment manufacturers’ standards, following which Eskom must concession all these power stations with clear targets for the electricity availability factor and operations”.

In a briefing note on Eskom’s debt relief plan, National Treasury advised that the outcome of the independent assessment would be shared with the National Energy Crisis Committee (NECOM). “Eskom is then expected to implement all relevant recommendations emanating from this independent assessment, after approval by the Minister of Finance, and to formally incorporate these additional conditions into its corporate plan for the 2024/25 financial year”.

In May, it was reported that the review had been “updated to take account of South Africa’s acute electricity supply deficit”. It was reported that the review would involve a technical assessment of the feasibility and cost of refurbishing and/or repowering each Eskom power station, and would be used to inform any revision to Eskom’s existing coal decommissioning schedule.

In September, the vgbe report was made available to National Treasury. To date, and despite the significant public interest in the report and its potentially wide-ranging implications for South Africa’s energy future, the report has been kept under wraps.

Brandon Abdinor, Acting Head of the Pollution and Climate Change Programme at the Centre for Environmental Rights, says that, “Eskom’s decommissioning schedule and the pace at which South Africa can decarbonise its electricity system is crucial for several reasons – the health impacts from air pollution; the urgent need to reduce greenhouse gas emissions; addressing energy security and the rising cost of electricity; as well as ensuring a well-planned and just transition away from coal”.

On 17 October 2023, the Centre for Environmental Rights (CER) submitted an access to information request to National Treasury for, inter alia, a copy of the vgbe report.  A response was received on 25 October wherein National Treasury indicated that the CER’s request would be deferred until it had presented the report to Parliament, which process could take up to three months. The CER has responded to say that the report should be made available immediately given the immense public interest in the matter.

“Any information which may have a bearing on the lifespan of Eskom’s coal-fired power plants is crucial and should be made available for public scrutiny without delay. The vgbe report could also influence the Medium Term-Budget Policy Statement, which is being released today. Effective civil society oversight rests on processes which ensure that all relevant information – including information informing policy – is made available in advance of decision-making to allow for effective public participation,” says Robyn Hugo, Director of Climate Change Engagement at Just Share.

“It is also important to note that any decision to extend the life of coal-fired powered plants would potentially risk financing committed to the country under the Climate Investment Funds’ Accelerating Coal Transition (ACT) investment program,” says Leanne Govindsamy, Head of Corporate Accountability and Transparency at the Centre for Environmental Rights. This involves $500 million of highly concessional ACT funding which is expected to directly catalyse $2.605 billion as part of South Africa’s Just Energy Transition Partnership Investment Plan, for repurposing and replacing coal-based power generation capacities with dispatchable renewable power generation. She says further that, “these funds are specifically intended to support phasing out coal and South Africa may not be able to benefit from these highly concessional and catalytic loans should we extend the life of coal plants”.

President Ramaphosa has recently referred to a “strong and effective civil society” as a key strength of South Africa. The strength of civil society depends on access to information and meaningful public participation, as required by the Constitution. The vgbe report should be released without any further delay.