No new coal or nuclear for least cost energy, says Presidential Climate Commission
The Presidential Climate Commission (PCC) has concluded that there is no room for new coal and nuclear power in South Africa’s energy mix. Instead, the massive deployment of renewable energy would provide the least cost electricity for the country, the commission’s recommendation report has found.
“In the short term, the least cost, no-regret option remains renewables, batteries, and balancing and peaking support, for example from gas. Not only are these the cheapest, secure options, but they are also the only options with build times short enough to make a meaningful impact on load shedding”, the report read.
The commission also highlights that those advocating for additional investments in coal ignore the risks to the broader economy that this would present. This includes the devastating impacts of climate change and deadly air pollution, as well as trade-related transition risks and access to finance.
President Cyril Ramaphosa established the PCC in September 2020. The independent body is tasked with overseeing and facilitating a “just and equitable transition towards a low-emissions and climate-resilient economy”, involving supporting workers and communities affected by the coal phaseout. The publication of its latest recommendations follows a request from Minister Gwede Mantashe for input on the Integrated Resources Plan (IRP), which is currently under review. The PCC requests that the IRP is to be updated according to its recommendations.
Renewables take centre stage in least cost pathway
The PPC’s latest modelling, alongside stakeholder consultation, was unequivocal in concluding that clean energy dominates in the least cost pathway by 2030. This includes 50 to 60 GW of renewable energy (wind and solar), storage (batteries and pumped hydro) and between 3 and 5 GW of peaking support, such as gas.
“None of the models build new coal or nuclear or have gas at high utilisations”, the report states. It also highlights that this recommended pathway will attract the best finance terms. “In fact it is likely that new coalfired power is simply not financeable.”
The report also highlights that without decarbonisation, South Africa’s export commodities are at significant risk of climate-related trade barriers — such as the European Union’s Carbon Border Adjustment Mechanism (CBAM). This could have widespread negative impacts on South Africa’s international competitiveness, key export sectors, and the balance of payments and employment across several sectors.
Coal and nuclear would mean higher bills
The PCC’s recommendations conflict with recent messaging from ministers who are advocating for more coal and nuclear in South Africa’s future. For example, in May, Minister Mantashe said a request for proposal for 2,500 MW of nuclear power would be issued, saying it was the lowest-cost energy in the country at 40c a unit.
But the commission’s head of mitigation, Steve Nicholls, told News24 that there is no evidence behind such claims. “We have heard some public statements that nuclear is cheaper than variable renewable energy. We can’t find any reference for that in the international literature”, he said.
Instead, the PCC’s independent modelling clearly finds that the inclusion of coal and nuclear – and gas use above peaking support – in the mix will cause an increase in the cost of electricity. “It is critical therefore, that the decarbonisation of the electricity sector follows a least cost pathway” for the cheapest and most secure energy future, the commission concludes.