Keynote Address by Deputy Minister Narend Singh at the FEDUSA Climate Change and Just Transition Summit, 5 September 2024
Programme Director
President - Mr. Masale Godfrey Selematsela
Vice President - Ms. Martlé Keyter
General Secretary - Ms. Riefdah Ajam
Other Members of the Executive present
Invited guests,
Ladies and Gentlemen,
I am delighted to be here at this event to discuss the climate crisis and the just energy transition with you. Concern about the climate crisis is no longer limited to international and non-governmental organizations. According to the World Economic Forum's annual Global Risks Perception Survey (GRPS), climate action failure, extreme weather events, and biodiversity loss are identified as the top three global risks by severity over the next ten years.
In the context of South Africa, we have identified two categories of risk to our economy and society. The first is the physical risk, as scientific evidence shows that sub-Saharan Africa is particularly vulnerable to climate change and is warming at twice the global average rate. This leads to increased average temperatures, severe storms, droughts, and rising sea levels, posing risks to our food and water security, infrastructure, and the health of humans and animals.
The second category of risk is the transition risk. The global shift to a low-carbon economy is underway, and countries investing significantly in low-carbon technologies are implementing measures to protect their investments.
As an example and from a South African perspective, the disadvantages of the Carbon Border Adjustment Mechanism (CBAM) could potentially be significant, impacting the country's economy and its international trade relations. As a mechanism designed to level the playing field for EU producers by imposing charges on imports of certain goods from outside the EU based on their carbon content, CBAM could disproportionately affect South African exporters, particularly in sectors like steel, aluminum, and power generation, where the country relies heavily on coal. This could lead to a decrease in competitiveness of South African products in the EU market, potentially reducing export revenues and affecting overall economic growth.
Additionally, implementing necessary adjustments to meet the requirements of CBAM could require substantial investment in cleaner technologies, which might be a challenging endeavour given our country's energy infrastructure and economic constraints. So this then underscores the need for thoughtful consideration and potentially seeking collaborative solutions to mitigate adverse impacts on developing economies like South Africa.
If we do not adopt the technological transition taking place worldwide, our economy risks falling behind and becoming non-competitive in a trade environment that favours goods and services produced in a low-carbon setting. This transition risk will affect major sectors of our economy, including energy, mining, agriculture, transport, and manufacturing.
An example of the challenges ahead is the recent decision by the European Union to ban the import of motor vehicles with internal combustion engines from 2035.
Even though we are not historically responsible for climate change caused by industrialized nations, we need to decarbonize for the world to achieve its climate goals. This presents an opportunity to offer investors significant "climate returns" by committing to voluntary decarbonization in exchange for concessional funding from developed countries.
Just transitions will require extensive policy, legal, technological, and market changes to ensure fairness and equity. We must also consider the social risks associated with the transition, particularly related to potential job losses and their impact on country development agendas.
To foster a just transition, the Departments of Forestry, Fisheries and the Environment (DFFE) and Trade, Industry and Competition (DTIC) have jointly conducted a National Employment Vulnerability Assessment (NEVA) and Sector Jobs Resilience Plans (SJRPs) for sectors vulnerable to job losses due to climate change responses. This work aims to prevent the resulting economic and social burdens from falling on vulnerable people and communities. Sectors examined include coal, metal, transport, agriculture, and tourism value chains, with identified opportunities being piloted in Mpumalanga (eMalahleni, Steve Tshwete, Msukaligwa, and Govan Mbeki communities) with the assistance of the Council for Scientific and Industrial Research (CSIR).
The pilots are focusing on the development of business cases to enable a just transition to sustainable energy systems in the Republic. This will assist Mpumalanga in retaining its reputation as an energy hub by developing renewable energy generation plants in municipalities vulnerable to declines in coal activity. Prioritized activities may also include infrastructure for developing skills in the maintenance and repair of renewable generation, manufacturing of renewable generation components, and allied services. Other identified opportunities for the province are:
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Recycling coal combustion waste products such as fly ash to create new jobs and livelihoods.
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Implementing a Just Energy Transition social protection plan.
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Establishing a Low-carbon just energy transition in the Mining, Timber, Pulp, and Paper sectors, including using biomass from invasive plants for process heat and electricity supply.
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Accelerating the diffusion of early warning systems and tools to ensure food security and support the just transition initiative.
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Measures for workforce reskilling and job absorption, social protection and livelihood creation, incentivizing new green sectors, and economic diversification.
We also acknowledge the efforts of the industry. For instance:
The National Business Initiative (NBI) has mapped out feasible pathways for South African business sectors to achieve carbon neutrality by 2050. Some of the country's largest emitters have committed to supporting the country’s goal of achieving net-zero carbon emissions by 2050.
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Eskom, the country's largest GHG emitter, has committed, in principle, to achieving net-zero emissions by 2050.
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Anglo American has set a global target of achieving carbon neutrality by 2040.
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Exxaro, one of South Africa’s largest coal miners, aims to attain carbon neutrality by 2050.
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SASOL is exploring pathways to achieve net-zero emissions by 2050.
The labour sector has a significant role in transitioning to a low-carbon economy and climate-resilient society. There are opportunities to address the triple challenges of poverty, unemployment, and inequality if done in a just manner.
We, as the DFFE, are willing to work with labour on-ground projects to initiate the just transition concept. Let us collaborate, innovate, and implement the solutions that will power our nation forward. Let us build a future that aligns with our environmental, economic, and social imperatives. A future where sustainable energy drives our progress, where no one is left behind, and where we stand as a beacon of hope and resilience in the face of global challenges.
We must also recognise that Local government is at the coal face of our efforts, as this is where policy legislation and regulation turn into action. We must be focusing on a back-to-basics approach, getting the basics right with respect to our daily deliverables. I'm talking about a suitably skilled work force, continuous training and upskilling of officials and in respect of service delivery, examples like waste collection and disposal, ensuring clean water supply, and enforcing emissions compliance with local industry. More than half of the battle will be won if every local sphere of government gets the basics right. Innovation and consistently good service delivery are what will carry the day.
We therefore encourage FEDUSA to take advantage of its position in the just transition debate:
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Conscientize - continue to impress upon its members and society, the opportunities presented by the just transition.
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Collaborate - work with other sectors to implement just transition ideas. Be part of the discourse.
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Convene - try to work together to build a robust compact to coordinate and rally a common position on matters that shape the policy.
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Challenge - engage and support positions with strong and robust scientific evidence; team up with research institutes, councils, academia, and think tanks if there is no capacity to generate such evidence.
In conclusion, allow me to thank you for your time, your energy, and your commitment to this cause to support the achievement of our broader development agenda and integrate the needs of individuals, societies, and businesses on a more sustainable road for our country and our planet.
Achieving this objective requires us to work together with a common understanding. Your study is, therefore, a significant contribution in this regard.
And I together with Minister George, Deputy Minister Swarts and the Department of Forestry, Fisheries and the Environment, will be with you every step of the way on this journey to a just energy future, which ensures that no worker is left behind.
I Thank you.
For media enquiries, contact:
Peter Mbelengwa
Cell: 082 611 8197
E-mail: pmbelengwa@dffe.gov.za
