Forbes Piece: South Africa’s Energy Struggles Ring Familiar In Other Countries

Matamela Cyril Ramaphosa, President of South Africa delivers his national statement during the High-Level Segment for Heads of State and Government summit on the third day of the COP27 UN Climate Change Conference on November 8, 2022. (Photo by Dominika Zarzycka/NurPhoto via Getty Images)

So much of the focus around the energy transition and its impacts centers around the OECD countries, along with China and India, that issues impacting developing countries in other parts of the world are often largely overlooked. This has been the case in South Africa, whose government, domestic industries, and population have struggled with a major energy and grid crisis throughout 2023.

South Africa’s state-run utility, Eskom, provides about 80% of the country’s electricity through coal-fired power generation. In recent years, the government led by Cyril Ramaphosa has severely restricted the building of new coal plants in favor of subsidizing wind and solar in efforts to meet the country’s climate commitments. As the country’s population and economy have continued to grow, the net result has been similar to those seen in California and other regional U.S. grids, with grid managers struggling to avoid frequent power shortages and blackouts.

[Note: This story is also published at Forbes.com.]

The World Bank approved a $1 billion loan to South Africa in late October to help the country address these worsening issues, but that loan, like a previous $439.5 million loan, is designed mainly to pay for converting some older coal plants to renewables. With demand for electricity continuing to rise, this approach is unlikely to provide a real solution.

Two major oil companies, Total Energies and Shell, have been working to try to provide a different solution which involves developing large deposits of natural gas in South Africa’s offshore. If developed, the natural gas could be used in conjunction with wind and solar to displace many of the coal-fired power plants as they are decommissioned in the coming years. It’s an approach that has worked quite well in the United States over the course of the last 15 years, one that has enabled the U.S. to lower its domestic emissions to levels not seen since the early 1990s.