• Speaking at the Climate Resilience Symposium this week, President Cyril Ramaphosa highlighted how climate change directly affects the economy.
• The president noted that recent storms in the Western Cape shut down ports, negatively impacting the economy.
• Ramaphosa further reiterated that transitioning away from carbon based energy should be done with consideration for all people and done justly.

This week the Climate Resilience Symposium is taking place at the CSIR International Convention Centre in Tshwane. The symposium welcomes climate experts from government and academia to discuss climate change and its impact on not only the world, but South Africa as well.

On Monday, President Cyril Ramaphosa addressed the symposium and highlighted how important of an issue climate change is. Pointing to recent storms that have hammered the Western Cape, leading to flooding, the president noted how vulnerable humanity is to the changing climate.

“The storms that hit parts of the Western Cape over the past week have caused devastation to homes, communities, businesses and infrastructure. These adverse weather conditions temporarily brought container ship traffic to a complete halt at the Port of Cape Town. Rough seas resulted in cargo vessels losing containers overboard and others being extensively damaged,” Ramaphosa said in his address.

This extreme weather leads to multiple problems that have a tangible effect on the local economy. Farmers who are exporting produce have to wait for storms to abate before ships can load their stock, potentially spoiling the produce. With agriculture being a crutch for the local economy, this is bad news.

“Disruptions caused by climate change increase the cost of doing business, undermine competitiveness and dampen employment growth. These disruptions result in lower tax revenue and increased expenditure on disaster relief, health care and social support for affected communities. Extreme weather causes damage to infrastructure like roads, bridges, railways, power lines and ports, all of which incur substantial repair and recovery costs. The resultant strain on public finances then necessitates the reallocation of funds from other essential services,” the president said.

“To manage the higher expenditure and lower revenues government may then need to increase borrowing, leading to higher debt levels and interest payments. This limits government’s ability to invest in other critical areas. The National Treasury is therefore central to our response to both the shocks of climate change and the potential opportunities to use the just transition as a springboard to build a more inclusive, resilient and sustainable economy,” he added.

However, the president notes that while addressing climate change is terribly important, moving away from fossil fuels and carbon-based energy generation isn’t as easy as we’d hope. The trouble is that given how pervasive carbon is as an energy source, it’s rather affordable, especially when compared alongside alternatives. We can see this play out locally where those with the means can install solar power and ignore loadshedding whereas those without the means have to endure the power outages.

As such, transitioning to non-carbon energy is more complex on the African continent than it is in other parts of the globe. South Africa is trying to make strides in this area but Ramaphosa is tempering expectations.

2030 is the deadline set by the United Nations for carbon emissions to be cut by 45 percent globally on a path to reducing emissions to net zero by 2050. Ramaphosa appears to believe that South Africa can reach that goal.

“Our revised Nationally Determined Contribution balances our developmental needs and economic realities. It takes into account the feasibility of undertaking a climate response through a set of just transition pathways. Importantly, it notes carbon tax as a vital component of our mitigation strategy to lower greenhouse gas emissions. By internalising the cost of carbon emissions, the carbon tax incentivises companies to reduce their carbon footprint and invest in cleaner technologies. The carbon tax also generates revenue for climate initiatives. These funds can be reinvested in renewable energy projects, energy efficiency programmes and social support mechanisms,” says the president.

Energy is by far one of the biggest contributors of carbon emissions but it’s not as easy as spinning up a few solar farms. The physical transmission and distribution grid isn’t designed around renewable energy.

As researchers at WITS highlighted last year, “The grid was designed to transport electricity from Mpumalanga to the rest of the country, with high-voltage cables that reach cities and towns and low-voltage cables which support distribution to homes. This means that the grid is not designed to transport electricity in the opposite direction due to the prevalence of low-voltage cables in the western regions which are quickly gridlocked by excess electrical capacity.”

The real problem here is that solar, wind and other renewable energy would have to be located further South where there isn’t really infrastructure to carry power to the rest of the country.

While the problem isn’t unique to South Africa, the country needs to rethink the electricity generation, transmission and distribution network to account for new energy generation. This takes time and requires investment which is perhaps the biggest roadblock here.

To that end, Ramaphosa notes that we should look beyond our borders for this investment.

“International development finance institutions and governments of the Global North that made financial pledges under the Paris Agreement and COP26 are important sources of cheap and concessional capital. To access this and other funding, we need a credible project pipeline. We need to work with all spheres of government, with communities and with the business sector to create new manufacturing, mining, agriculture and service opportunities. The science of climate change is complex. So too are the economic, technological, social, ecological and political implications. Nonetheless, climate action is an imperative. We must act now,” the president said.

Government is exploring ways to transition from coal to renewables including the Renewable Energy Independent Power Producer Procurement Programme, Integrated Resource Plan, and Just Energy Transition Investment Plan among others.

Transitioning away from cheap coal power is a complex problem but if we want to try and avoid a full war against the climate, we need to dive into the problem and work it. That is of course, easier said than done.

[Image – Markus Kammermann from Pixabay]