Coal to remain vital for South Africa - Mr Patel

Monday, 14 Nov 2011

Mr Ebrahim Patel economic development minister of South Africa recently said that South Africa could not afford a dramatic switch from coal to green energy.

Mr Patel said that doing so would result in an electricity price spike that would destabilize the economy, he told Parliament's economic development portfolio committee.

He said that "We cannot abandon coal as coal contributes to the relatively low electricity prices we have. Coal is a very cheap generator. We have to use our savings on coal to subsidize the entry into the market of renewable energy sources. We have a responsibility to balance these things."

The minister was briefing the committee on the government's plans for a green economy. He cited the existing example of using a percentage of Parliament's electricity bill to help fund the state's solar water heater program, which he described as a success story. This showed it was possible to grow demand for a green product, and use greater production volumes to decrease costs over time.

According to the department, 100 000 low-pressure solar water heaters had been installed in poor and rural areas. Some 40 000 of the more expensive high-pressure models had been acquired by wealthier households in recent years.

Mr Patel said his department is trying to forge an agreement with the insurance industry for the program on replacing damaged geysers with the new technology.

He said research showed 200 000 households had to contend with burst geysers annually, creating a fantastic market opportunity for the solar heater project.

A deal to leverage finance from insurance companies was imminent. It would include arrangements for cases where the replacement cost was higher than the current price of electrical geysers.

The solar water heater project had created more than 500 jobs for previously unemployed people in poor rural areas.

But Mr Patel said that it was of concern that the project uptake had been highly uneven in different provinces.

(sourced Timeslive)