Umm Muhammed Umar

Eskom has launched the renewable energy tariffs pilot program. Renewable energy has been a discussion in South Africa for some time now, but has not been, according to some, well supported by government and Eskom. This this time the focus of the program is business – to supply clean electricity to the utility’s customers. Mandy Rambharos, General Manager of the Just Energy Transition office, Eskom, spoke about to Radio Islam about the program.

Rambharos said that the very important aspect that they’re picking up from the move towards cleaner energy, globally, is that they face carbon border tax adjustments, and penalties for having a high carbon footprint. She says that they often receive phone calls from various businesses asking if there was any way they could reduce their carbon footprint as it impacts them directly on trade and export. She added, “And so I think as we decarbonize, as we move towards low carbon technologies, we reduce the carbon footprint, which means that the inherent property footprint of the products produced by various businesses is also reduced.” Because renewable technologies drastically reduce in price over the years, electricity tariffs should be positively affected in the future. Rambharos said that while they had to go up now, over time that could also change the electricity system.

The potential client has to become enthusiastic – and will want to know whether a program is cost effective, they’re looking at whether this renewable energy program will make any monetary sense. Rambharos said that that related to the various penalties coming their way. However, she added that even if one didn’t care about climate change, the cost of renewable technologies, has drastically improved and reduced counts by 60% over the last 10 years. Rambharos said, “given the fact that we need to invest in new capacity in the country as we have capacity shortages, if you look at what technology we should be investing in, it must be renewable from a pure cost perspective, it is far cheaper than putting in coal, or nuclear for example.” She said that the impact of penalties on carbon footprints should not be underestimated, “So say for example at the moment, instant carbon footprint is one kilogram per kilowatt hour. That is calculated in your product that you produce that you’re exporting. And what is happening is because there’s tax adjustments from the EU and other markets that we export to, they are saying to us, “we do not want to import your products which are a bit too high in carbon”. As we reduce that carbon footprint, we become more competitive, which reduces the costs of technologies. Rambharos said, “All of these things accumulate to actually be more cost effective for the business owner.”

There is an upfront investment for businesses, which will depend on the size of the business. Rambharos, however, is confident that this will prove worth it in time.