OPINION: 'The country could have created 165 688 more jobs in the renewable energy sector'
JOHANNESBURG – South Africa could have created 165 688 more decent jobs in the renewable energy sector if the country did not import most of the components used in the solar photovoltaic (PV) field and concentrated solar power (CSP) technologies.
However, according to Independent Power Producers Procurement Programme Office, the country only created 31 207 jobs for South Africans, while the National Energy Regulator of South Africa (Nersa) reported on March 31, 2019 that the 23 Renewable Energy Independent Power Producer Procurement Programme (Rei4P) projects could only create a combined total of 737 operational jobs.
The total costs of all energy produced by Rei4P projects in the first half of 2019 was R13.65 billion.
Nersa explains that job creation for renewable energy power generation is characterised by a high number of jobs during the construction phase of the project, as there is a high intensity of work to be completed to get the project running within a short period.
Once the project is in operation, jobs that remain are fewer and are in technical maintenance and administration, which is responsible for managing the business aspects of the power plant. The problem is South Africa is an importer of products that can be manufactured in the country by our people.
I am grateful that President Cyril Ramaphosa invited me to participate in the Sustainable Infrastructure Development Symposium South Africa, however, it is most important that we place decent work at the heart of discussions to accelerate infrastructure investment as a critical driver of future inclusive growth of the South African economy.
I am concerned that employment is only mentioned in the context of the expanded public works programmes that have been used in South Africa to create employment opportunities.
The International Labour Organisation sums up decent work as the collective aspirations of people in their working lives.
It involves opportunities for work that is productive and delivers a fair income, security in the workplace and social protection for families, better prospects for personal development and social integration, freedom for people to express their concerns, organise and participate in the decisions that affect their lives and equality of opportunity and treatment for all women and men.
Infrastructure investment is vital to a country, while investment in energy can deliver more jobs and decent work for all in Africa.
The Integrated Resources Plan 2019 that was approved by the Cabinet that solar PV, wind, and CSP with storage, present an opportunity to diversify the electricity mix, produce distributed generation, and provide off-grid electricity. Renewable technologies also present a huge potential for the creation of new industries, job creation, and localisation across the value chain. I don’t know why decent work is not at the centre of our economic policies.
The Organisation for Economic Co-operation and Development and the International Energy Agency submitted that around 600 million people in Africa still have no access to power, representing 48 percent of the continent’s population of nearly 1.2 billion.
The Council for Scientific and Industrial Research reported, using conservative estimates, that the 2019 load-shedding feat cost the South African economy between R60bn to R120bn, not calculating the jobs that were destroyed.
Endowed with substantial renewable energy resources, Africa is in a position to adopt innovative, sustainable technologies and could play a leading role in global action to shape a sustainable energy future. Africans must become manufacturers, not just importers of technologies.
Sustainable development and use of the continent’s massive biomass, geothermal, hydropower, solar, and wind power have the potential to rapidly change Africa’s current realities and create decent work. The African Continental Free Trade Agreement also aims to create a huge market for manufacturing.
Importantly, the Department of Trade and Industry (dti) submitted that the economy cannot achieve its goals based on importing most of the products we use when it can be manufactured locally and create jobs. The government is leading the way with its Local Production and Content Initiative.
Maintaining the appropriate balance of imports and exports is crucial for a country. The importing and exporting activity of a country can influence a country's gross domestic product, its exchange rate and its level of inflation and interest rates.
Why were the policies of the government not implemented, if the evidence is obvious? One needs to look at the research-based approach to employment creation.
The employment factor methodology estimates both direct jobs in the manufacture, construction, and operation and management, and indirect jobs both in the upstream supply chains of the raw materials and inputs to manufacture of solar PV, wind turbines, and construction of wind farms and solar PV power plants.
China, the leading producer of PV equipment and the world’s largest installation market, accounted for about two-thirds of PV employment worldwide, or some 2.2 million jobs.
Treasury in the 2020 Budget Review submitted that the government has committed to procuring 14 725 megawatts (MW) of power from renewable energy sources in terms of the Integrated Resource Plan 2010 to 2030. Up to 2019, 6 422MW has been procured from 112 renewable energy independent power producer projects over seven bid windows, and 3 976MW of electricity generation capacity from 64 projects has been added to the national grid.
Private-sector investment in the programme amounts to R209.7bn to date, of which R41.8bn is from international investors and funders.
So when the employment factor is applied it is easy to calculate the number of direct decent jobs that could be created.
The total amount of jobs that could be created in the renewable energy sector utilising solar PV could have been 482 980 decent jobs if we all support the dti Local Production and Content initiative.
Putting South African First should be a priority for all South Africans. To this end, the country needs a burgeoning manufacturing sector and fewer imports.
Dr Dennis George is the executive chairperson of African Quartz. This article reflects his personal views and are based on academic research.