In practice, the promise of free electricity has not resulted in just and sustainable access to power for the poor. We should be using the Free Basic Alternative Energy to wean consumers off dirty power sources and begin the just energy transition, writes Pieter Coetzee.
The discourse around South Africa’s energy crisis is almost exclusively driven by the news cycle. We jump from story to story and crisis to crisis, fuelling our outrage but finding few solutions.
The commitment at COP26 by the UK, US and the European Union to provide $8.5 billion over the next three to five years to fund South Africa’s just transition is only the latest, exciting piece of breaking news. But some of the most promising potential catalysts for a just transition can be found in existing policy mechanisms if we just know where to look.
One reason why South Africa’s shift towards a just transition has been so slow is that we continue to overlook simple solutions that already exist and are fully within our control. Our current approach to energy policy needs concerted coordination and innovative thought. And the availability of the Free Basic Alternative Energy (FBAE) policy is the perfect place to start.
Government introduced the Free Basic Electricity (FBE) and FBAE policies in 2003 and 2007 respectively, in recognition of the importance of access to power for poverty reduction and improving people’s standard of living.
Currently, the primary vehicle for providing indigent South Africans with energy is the FBE programme. The programme gives limited free electricity – 50 or 60 kWh per month – to indigent households. But in practice, the promise of free electricity has not resulted in just and sustainable access to power for the poor.
The FBAE programme was introduced to supplement the FBE in remote or inaccessible areas that could not be electrified. Unlike the FBE, which provides electricity from Eskom, under the FBAE, municipalities can provide indigent households with paraffin, liquified petroleum gas (LPG or common household gas), and renewable energy, among other viable alternatives.
The FBAE can and should be more than a supplementary policy. It should be leveraged by municipalities as a viable alternative to the FBE, with government using it to drive the shift towards cleaner energy for more households.
Sadly, after 14 years, the realisation of the benefits of the FBAE policy is absent. For many years, the Department of Energy has reported ongoing constraints to the rollout of the policy. These include the difficulty of convincing people to move away from sources like paraffin, lack of information at municipal level on the rollout of FBAE, and lack of indigent policies. The failure to address these constraints has left the country unable to capitalise on the full potential of the FBAE.
For example, 11.3 million households received electricity services from municipalities in 2017. Of these, more than 2.5 million received free electricity under the FBE. By contrast, only 237 000 received free basic alternative energy under the FBAE. According to Stats SA, by 2018 only 49 municipalities supplied indigent households with an off-grid energy source. There is therefore huge scope to shift households to alternative sources of energy.
Worse still, where alternative energy is supplied, the data shows that we are not supplying households and communities with the best possible alternatives. In 2018, more than 5% of South African households still relied on candles as their main source of light. Only 113 000 indigent households received solar energy, and about 86 500 households received paraffin. Only one municipality in the whole country provided LPG to just 104 indigent households – even though LPG is much more efficient, cleaner and safer than paraffin. This is an unfortunate example of just one way in which we are not taking full advantage of existing policy mechanisms with the potential to change the energy landscape and living conditions across South Africa.
All over the country, those who can, are investing in systems to make themselves less reliant on Eskom, and less vulnerable to loadshedding. Through the FBAE, government can and must help indigent households to do the same. This is the epitome of a just transition – using an existing, government-funded programme to promote greener energy while shielding vulnerable energy consumers from the worst effects of loadshedding and energy insecurity.
We should be using the FBAE to wean consumers off dirty power sources and begin the just energy transition. We have existing infrastructure that should be better used, like the LPG import facilities in KwaZulu-Natal and the Western Cape, while investing in renewable energy procurement projects. Rather than FBE awareness, we ought to be investing in the expansion of the FBAE and nudging consumers towards the full spectrum of cleaner energy options.
This underutilisation of the FBAE illustrates the limitations in the current approach to providing people with basic services. Electrification is a worthwhile pursuit, but the singular focus on it is a disservice to the very households we seek to empower. Rather, we need to take a holistic view of the sustainable and cleaner options available under existing policies. We need to seize this moment to advance the just transition by reimagining our energy landscape, and creating long-term, sustainable change. We have the policy levers to begin making the just transition a reality; it’s time to pull them.
– Pieter Coetzee is the CEO of Sunrise Energy, a liquefied petroleum gas (LPG) import facility in Saldanha Bay in the Western Cape.