South Africa Energy Market Report - July 2017


South Africa has confirmed that Gas can be used to supplement the variable nature of renewables, thereby adding to a steadily diversifying energy mix. Variable renewable energy (VRE) is nondispatchable, owing to the fluctuating nature of, for example, wind and solar power. These VRE sources have a more variable cycle than dispatchable renewable sources, as their capacity depends on nature. Coal-baseload power currently electrifies 90% of the country through State-owned power utility Eskom and that, given the need to adapt to climate change and the country’s carbon emission reductions targets, gas can be used in conjunction with renewables to help diversify the country’s energy mix. Gas power stations would also mean that the power system could be managed more efficiently, as gas power stations have the advantage of flexibility, in terms of starting up or shutting down. Also, gas power stations can be set up in the modular fashion, making it easier to expand capacity by adding additional turbines over time as needed.

Late April this year, the Government’s plans for the 9,600 Megawatt nuclear power generation has been stopped by the Cape Town High Court. After considering various objections and viewing the facts of the requirements for SA’s future power requirements, it was put down due to the basic unlawful decision-making by Government and a review of the Country’s power demand and affordability (economic impact). Gas in comparison seems as this point a more economically sound option which will further diversify South Africa’s energy mix. A diversified energy portfolio will enable industries to balance the benefits and risks associated with each energy source; therefore Gas is also an economically sound option for power generation expansion.


Based on current local and international factors, the fuel prices for July 201 decreased due to the international oil price which remained depressed and prices were adjusted as follows:

- Unleaded 93: R 12.63

- Unleaded 95: R 12.86

- LRP 93: R 12.63

- 0.05%: R 10.98

- New 0.01%: R11.03


South Africa is still implementing the first phase of the Greenhouse Gas Emission Mitigation system and needs to still allocate carbon budgets to companies that are significant emitters of greenhouse gases. South Africa has also not yet finalized the National Climate Change Adaption Strategy. Part of the reason South Africa has moved so slowly on this issue is how much fossil fuel companies are currently contributing to the greater economy. The WSSD (Word Summit of Sustainable Development) where the Johannesburg programme of action was adopted for these matters to occur was held 17 years ago. At that gathering, many companies made certain commitments, but now want to determine the pace of transforming green economies.

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