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SUSTAINABLE ENERGY NEWS NUMBER 10

2. SA's renewable energy progress

Are Tradable Renewable Energy Certificates (TRECs) simply carrots without sticks? At a recent Sustainable Energy Policy Concepts for South Africa (SEPCO) workshop principles and plans for feasible instruments for more sustainable energy service delivery were discussed and developed. In plenary sessions the focus shifted to principles for a regulation to foster electricity generation from renewable energies and on the design and implementation of energy centres and agencies. The latter refers to the idea of a national network of local/decentral energy centres in combination with national and regional energy agencies. The overall idea is to implement institutional structures which are appropriate to support both energy efficiency and renewable energy projects, as well as to close the gap between policy and strategy that helps to implement sustainable energy projects. The workshop was based on the success of similar projects in Germany and Mexico. The workshop on principles for a regulation to foster RE electricity generation aimed to discuss principles for designing a regulation that fosters the use of renewable energies in the electricity sector, taking the draft White Paper "On promotion of Renewable Energy and Clean Energy Development" as a departure point. European experiences of feed-in regulations were considered. An internet-based forum for post-workshop discussions led to a polemic on the viability of certificates as a way of ushering in RE. Most participants in the workshop on regulatory measures favoured adoption of a feed-in law (a prescribed tariff) for electricity from renewable resources, rather than a quota or Renewable Portfolio Standard, and there was some consideration of the use of certificates as a supplement to regulation. Everyone at the workshop agreed that there should be a levy or tax on fossil fuels (and nuclear power) to supply a fund to support research, development and demonstration of Renewable Energy Technologies (RETs) and energy efficiency and support development of local industries. One prevailing RE governance model was the RE portfolio standard or quota system - all distributors are obliged by law to source a certain portion of their electricity from renewables. The certificates are then a way of tracking who sells what to whom. It is envisaged that the National Electricity Regulator would issue these certificates upon proof of generation. These would be accompanied by penalties if the quota is not met with the fine going into a fund promoting the research the development of RE. This would not only counter the subsidies that fossil fuels have always enjoyed, but also to compensate for the high investment risks of RE since most of the cost of RETs lies in actually getting the plant up and running after which there are no fuel costs, few service costs and few staff. Thus there is a high investment risk that needs to be compensated for with an assurance that, once produced, the RE will be bought. Feed-in laws would set the price (with an annual review) and this would ensure security of market for the generator. A strong case was made for tradable certificates citing the many benefits: off-grid (or non-grid) electrification; non-electrical renewable energy technologies (such as SWH); demand side management programmes (which require baselines); regional and international trade. For the consumer, certificates generally bypass the need for having to buy storage technology for RE (one of the factors that pushes up the cost) since the grid now becomes the storage house. Some participants felt that promoting voluntary initiatives, such as Tradable Renewable Energy Certificates (TRECs), might be a useful compliment, but must not be seen as the primary vehicle for promoting RETs since they would not achieve the essential change in direction of energy development as part of a national policy and strategy. Another disadvantage of TRECs is that greenhouse gas mitigation is not one of the attributes valued within the certificate. There are also inherent dangers whereby certificates end up becoming pollution credit trading. Such problems surround the disaggregation of other benefits (avoided SOx, NOx, VOCs, oil imports...), in particular the way that emissions trading in the US has helped to perpetuate environmental racism - dirty plants close to communities of colour allowed to continue heavy pollution that is off-set elsewhere. It was suggested that schemes like TRECs should have a limited lifespan as renewable energy development is desirable in itself and is in some cases commercially competitive with fossils and will become increasingly so, and a call for a transition to a situation where penalties for pollution are so strong that incentives for environmentally sound practice are no longer needed. Carrots without sticks will not get rid of unacceptable practices, facilities and impacts (achieving the social benefits of sustainable development will require incentives but tradable certificates don't particularly serve this goal anyway, although some benefits would result). On a global scale, it was pointed out that the international sale of TRECs brings strategic considerations regarding the current status of the Kyoto Protocol, and US (and other) efforts to terminate its implementation; TRECs may be offered as an alternative to the Protocol 'credits', without the explicit link to sustainable development and to national and legally binding GHG reduction targets, and also undermining a multilateral approach to tackling climate change. The sale of TRECs makes it possible to buy virtual green power anywhere, even if our electricity supplier doesn't offer it. Some were of the opinion that if RETs are to be deployed as rapidly and as universally as possible; a mechanism that encourages only the most affordable projects, while legitimising business as usual in particular areas, may serve to defer urgently needed action. To enter the debate, join the online discussion forum at: http://www.ises.org/SepcoDiscuss.nsf Incinerator proposal for Sasolburg defeated by Civil Society groups The Sasolburg Environmental Committee together with groundWork and other national and international civil society groups joined forces to halt the proposed development of a hazardous waste incinerator in Sasolburg. The Free State government has disapproved the construction of the incinerator that, were it developed, would have been the largest hazardous waste incinerator in Southern Africa. The rejection the proposal comes exactly one month after the South African government ratified the Stockholm Convention, which calls for the elimination of dioxins, one of the main by-products of the incineration process. Full News24 report: www.news24.co.za Visit the GroundWork website for press releases: www.groundwork.org.za For more info on the health effects of dioxins: archive.greenpeace.org South Durban community bears pollution consequences while State, Durban Unicity and industry push through refinery plans without consultation Rates of asthma in South Durban are 29 times higher than the national average. The very many SAPREF incidents over the last two years, including toxic leaks that led to evacuations, clearly indicate that the refinery is in a critical state. None of these industries have been prosecuted, or their managers been held accountable for the deaths of workers. There is also no evacuation plan however for the residents in the South Durban area. Among other measures, The South Durban Community Environmental Alliance (SDCEA) scheduled a community meeting for September 30 with ENGEN who then refused to come to the meeting, claiming they have been insulted in the past. They also claim to be an environmentally friendly company but have refused to give details on what equipment they have installed and what they are spending to be more environmentally friendly. They attribute the heinous pollution in South Durban to domestic coal use when it's obvious that the oil refineries are culpable. Similarly, when SDCEA requests information from SAPREF, they are instructed to go to the Ministry of Justice and use the Promotion of Access to Information Act. SDCEA requests for information about emissions and pollution, result in the dispatching of brochures with photos of plants and flowers that have no bearing on the request. The Durban Unicity has failed to prosecute polluting industries when there are clear cases of criminal negligence against them. The Mayor and Deputy Mayor of Durban said they are "too busy with other meetings" to attend to the concerns of the community, even though SDCEA phoned and faxed them more than 7 times! Since ENGEN and the Mayor refused to come to the community, on October 22 all community members went to a Multi-Stakeholder Report back on the Multi Point Plan (MPP). This is one of the few legitimate regular gatherings where community people of South Durban have direct access to political representation. It soon emerged that there were development plans taking place without consultation. In a Department of Trade and Industry (DTI) publication of June 2002 for the National Council of Provinces, it is recorded that "discussions have been held with SAPREF, Engen and Sasol Polumers (sic) to start developing a petro-chemical hub located at a site next to the Durban International Airport". It is alarming to note that while the Minister of Trade and Industry, the MEC for Economic Development and Tourism, SAPREF and Engen shared the ownership of the MPP at its initiation in 2000, the spirit of openness and mutual sharing of a common strategy for South Durban is limited to industry and state with the community having to bear the pollution consequences. While discussions continue within the MPP forum, no action has been taken by government against industry for the very many SO2 exceedances at the various monitoring stations in the South Durban area. The SDCEA has requested a full report from the Minister and the MEC on the status of this debate: what development plans and types of industry are being discussed, what the time frames are, who the potential investors are and records of minutes of meetings. These discussions have a material impact upon the future of South Durban and SDCEA views the exclusion of civil society from this debate as unconstitutional. Environmental Impact Assessment (EIA) In September 2000, Minister Valli Moosa stated that the Department of Environmental Affairs and Tourism (DEAT) together with the Department of Agriculture and Environmental Affairs (DAE) would consider the communities' concerns around EIA. Since then various meetings have been held with the DAE, the Durban Mayor, but little progress has been made with regard to the concerns highlighted by the community in terms of EIA. In fact the concerns around EIAs have grown recently and records of decisions (ROD) have been granted without proper EIA being conducted. The DAE has failed to come up with a strategy of dealing with the very many EIAs - 64 from January 2001 to March 2002 - that both the DAE and the community are faced with in the South Durban area. The SDCEA has forwarded a strategy to the DAE, but have not had a response from the DAE, nor an alternative strategy. Coupled with the unconstitutionality of the manner in which EIAs are being undertaken, the Major Hazardous Installations (MHI) and the EIA regulations do not dovetail. EIAs can now be granted before the comment period for the MHI is run its due course. The SDCEA has thus requested a formal response from the DAE on the SDCEA's proposal and a draft strategy the DAE is considering to deal with the very many EIAs in the South Durban area. The SDCEA is concerned that when the local officials sought to take legal action against SAPREF, Mayor Mlaba intervened and rather sought to "engage" with a multi-national that is responsible for placing peoples' lives at risk constantly in South Durban. Furthermore, the dirty fuels debate has been delayed by government indecision and industrial interference. What was to be a South Durban debate has been moved to the National Economic Development and Labour Council (Nedlac) where there is no community representation. Government must develop a plan to ensure that industries in South Durban have access to clean fuel. The pricing structure for gas supply to South Durban should be publicised in order that the cost of this gas could be debated. If there is a fear of industries migrating out of Durban as a result of stronger regulations, then the argument that industries migrate to zones with lax regulations hold true. Incineration of waste is a dirty fuel, and the SDCEA will oppose such developments which go against the grain of the MPP. SDCEA has requested government to place a plan on the table to inform debate on clean fuels in South Durban, taking into consideration the very many incentives industry has for developing in South Durban. It has asked for a review of all present incentives for industrial development in South Durban, both hidden and those already made public, to be presented by government at the next meeting. For more information call Desmond D'Sa on 083 9826939 or Anna Weekes on 4611991 or 083 7141899.

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