6/2/2020 DEFF minister Barbara Creecy on key air pollution & climate change issues facing SA | EE Business Intelligence

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Johannesburg, 1 June 2020

After recent interviews with the minister of mineral resources and energy,the minister of public enterprises and the CEO of Eskom, which all touchedon issues of air pollution, climate change and the energy transition that isunderway globally, it was considered essential to interview department ofenvironment, forestry and �sheries (DEFF) Minister Barbara Creecy for herinput on these issues.

The interview covers:

- Eskom’s inability to comply with the recently increased SO2  emission limits.- Plans to avoid installing FGD plant at Medupi power station.- Under-reporting of legal contraventions at Kendal power station.- Construction of new coal-�red power plants in South Africa.- Initiatives to improve domestic ambient air quality in poor communities.

DEFF minister Barbara Creecy on key airpollution & climate change issues facing

SAby Chris Yelland, managing director, EE Business Intelligence

6/2/2020 DEFF minister Barbara Creecy on key air pollution & climate change issues facing SA | EE Business Intelligence

https://eebi.co.za/blog/in-the-news-1/post/deff-minister-barbara-creecy-on-key-air-pollution-climate-change-issues-facing-sa-27 2/8

- Further priorities to reduce air pollution in South Africa.- Initiatives to expedite EIAs for renewable energy projects.- South Africa’s commitment to the Paris Agreement on climate change.

On Eskom’s inability to comply with recently increased SO2  emission limits...

With your recent concession to increase the SO2 minimum emission standards(MES) from 500 to 1000 mg/Nm , thus making the SO2 emissions requirementtwice as lenient, Eskom advises me that only Kusile will comply with therelaxed SO2 limit, and it appears that there are no plans by Eskom to evercomply with the MES at its other coal-�red power stations. If this is the case,what will be the next steps by DEFF in this regard?

The �rst issue that one would want to say is that the new SO2 emission limitsof 1000 mg/Nm only apply to those plants that were built before 2010 andthat are not scheduled for decommissioning by 2030. Obviously, this is toallow for the fact that at the time the plants were built, the relevantenvironmental regulatory environment was not in place.

Currently, most of these plants are emitting three or four times this minimumamount. So, having a limit of 1000 mg/Nm will bring about a dramaticimprovement in air quality. For any plant built after 2010, the SO2 limit of 500mg/Nm applies.

The department is a regulator, and the regulations say that power plants mustcomply. There is no regulatory environment that allows any institution to saythat it will not comply. In some instances, they may only be able to complyover a period of time, and plants can then make application to come into fullcompliance over time.

On plans to avoid installing FGD plant at Medupi power station…

Eskom has recently informed me of plans to try and get out of installing �ue-gas desulphurisation (FGD) plant at Medupi. The retro�tting of FGD plant atMedupi was a commitment that Eskom made to the World Bank to meet SO2

emission limits as part of a US $3,75bn loan to construct this coal-�red powerstation. What is your view of Eskom’s plans to avoid FGD at Medupi in a waythat this power station will then not comply with the relaxed SO2 MES limits ofSouth Africa for the next 50 years of its planned life?

Well, let me start off by saying that I have only heard about this issue fromyourself and from what I have read in the public domain, but I have had noformal communication from Eskom in this regard. I think that before Icomment on it as the regulator, I would require a formal communication fromEskom.

As I said earlier, any plant that is built after 2010, and that would includeMedupi and Kusile, must comply with the SO2 emissions limit of 500 mg/Nm ,while the SO2 emissions limit of 1000 mg/Nm applies to power stations thatwere built before 2010.

So, unless a coal-�red power station is to be decommissioned before 2030, itwill require FGD or some other form of SO2 emissions control technology tocomply with the 500 mg/Nm or 1000 mg/Nm atmospheric emission limits.

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I understand that the World Bank may be a lender for the Medupi project, andI also understand that the bank may have certain requirements that Eskommay be required to meet. But as the regulator of emissions, no-one hasspoken to us at a formal level about dispensing with the FGD plant at Medupi,nor of not complying with the SO2 emissions limit of 500 mg/Nm .

On under-reporting of legal contraventions at Kendal power station…

The Compliance Notice of 10 December 2019 issued to Kendal power stationby your department says Eskom provided incorrect information using acalculation methodology that Eskom knows to be wrong, and is a “grossmisrepresentation of the facts”. Further legal contraventions of Kendal’satmospheric emission licence (AEL) and under-reporting to the regulatoryauthorities has since been acknowledged to me by Eskom in writing. Will DEFFlay charges against Eskom in terms of Section 51(1)(g) of the Air Quality Act inthis regard, and will DEFF investigate the matter if the same reportingirregularities are acknowledged by Eskom to be occurring at other Eskompower stations?

Will you give me evidence of these further AEL contraventions at Kendal andthe under-reporting of these to the regulatory authorities, that you refer to?[Yelland: Yes, Minister, certainly. I have the written communications in whichEskom itself acknowledges the contraventions and the under-reporting atKendal.]

Let me say to you that, with regard to this matter and other matters, thelicensing authorities that have a duty to ensure compliance are themunicipalities. In this instance the municipality asked DEFF to assist themwith the investigation into the non-compliances to the AEL that was issued toEskom for the operation of the Kendal Power Station.

So, clearly, at the end of the day, the municipality is the authority that wouldhave the �rst bite at any compliance issue, but we would step in if we wererequested by the licensing authority to assist. At the moment, they haveasked us to assist with this investigation. So, that is the role we play.

As you know, in an unrelated matter with this particular power station, I havealso recently dealt with an objection by Eskom to a Compliance Notice thatwas issued by DEFF, where I have said that they do need to close generatorUnit 1 and 5 at Kendal. I agreed that they can do this sequentially in order tomaintain energy security, but we have said that they need to �x these twounits, so as to comply.

We are also working with Eskom in implementing a review of generator Units2, 3, 4 and 6 at Kendal, so that we can �nd out exactly what is wrong withthese units, and what remedial action they would have to take in order tocomply.

On the construction of new coal-�red power plants in South Africa…

Two planned new coal IPPs in the IRP 2019, Thabametsi and Khanyisa, basedon �uidised-bed technology, will be amongst the most greenhouse gas (GHG)emission intensive plants in the world, with subcritical steam boilers and

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generators less than 500 MW. Can these new coal plants ever achieve �nancialclosure, and what is the current status of these plants? How will DEFF addressadditional licence applications and legal challenges for these and other highGHG-emitting plants, including the 3300 MW coal-�red power plant proposedfor the Musina Makhado Strategic Economic Zone?

Look, on the question of �nancial closure, all of us are aware that �nancialinstitutions across the globe are moving away from coal. So, I guess anybodywho wants to invest in this type of activity would have to take that risk intoaccount, and your guess is as good as mine as to whether they will ever �nd�nanciers for these projects.

I also do understand that there is pending litigation with regard to Thabametsipower station. So, I think at this stage I would not want to comment further onthis. Furthermore, the Environmental Authorisation for Khanyisa has lapsed atthis stage.

Regarding the status of a new 3300 MW coal-�red power station proposed forthe Musina Makhado Strategic Economic Zone (SEZ) in Limpopo province,you will need to ask the MEC for environment in that province about thatapplication as I am advised that application for the SEZ was made to thatcompetent  authority.

But what I do have to say, Chris, is that if those involved in these projectsfollow procedures, there is nothing, at the moment, that outlaws the buildingof new coal-�red power stations. Whether those projects can be �nanced, andmeet all regulatory compliance and other hurdles, I think we will have to waitand see.

On other initiatives to improve domestic ambient air quality in poorcommunities…

Whilst it is indisputable that power generation and industrial emissions inSouth Africa are by far the largest sources of air pollution, other sources alsocontribute to the problem. What is being done by DEFF itself, as opposed to theefforts of others, to address emissions by internal combustion engines,domestic burning of coal indoors, veld �res and the burning of waste andrubbish outdoors, which also impacts on air quality, most particularly on thelives, health and safety in poor communities? In your view, which othergovernment departments need to play a role to effectively reduce thesesecondary emission sources?

Just prior to my time, the Cabinet and Fifth Administration approved astrategy to address air pollution in dense, low-income settlements. Thisbrought together the Departments of Environment, Energy, HumanSettlements and Health to look at exactly what could be done in this regard.

I want to say upfront, that in my view, we have not done as much as we could,either as government as a whole, or as the Department of Environment, todrive this strategy. There are some very interesting possibilities here. Acountry like India has made enormous progress in dealing with domesticemissions and improving air quality in the domestic space through theinnovative technologies they have introduced.

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We have already seen initiatives by the Department of Human Settlement tointroduce solar geysers, and by Sasol and Eskom to introduce different formsof cooking in these settlements. But if we really want to deal with the ambientair quality issue at domestic level, we need to have a much stronger drive interms of combining different initiatives, and driving them more forcefully fromthe centre

We are developing a proposal to the Presidential Infrastructure Co-ordinatingCommission on improving energy e�ciency in the domestic space. Insulation,solar hot water geysers and new forms of cooking are all important issues.But one of the things I want to see in the post-Covid19 economic recoveryperiod is how we can work together much more effectively with HumanSettlements to introduce a lot of these initiatives at scale.

There are also interesting possibilities in terms of micro-enterprisedevelopment, domestic manufacturing production, and job creation.

On further priorities to reduce air pollution in South Africa…

In your view, has the government made su�cient progress in improving the airquality in South Africa since the promulgation of the Air Quality Act in 2004?Based on your experience in the environmental portfolio so far, what actionswould you like to prioritise over the next two to three years to reduce airpollution, especially in South Africa’s three priority areas (Vaal, Highveld andWaterberg-Bojanala)?

Well, I think I have already talked about initiatives that need to be taken todeal with Eskom and domestic pollutants, but there are two other issues thatwe need to look at here.

The �rst issue is that the monitoring and enforcement of air quality is aconcomitant power that rests across national, provincial and localgovernment. I think one of the things we can accept is that while in manyinstances local government is the licensing authority, we know that localgovernment has limited capacity in terms of delivery in general, and sometimes in terms of compliance and enforcement, in particular.

So, I think that supporting and strengthening the role of local government andlicensing authorities is obviously a very important issue. We spoke earlierabout work we are doing with regard to Kendal, and I think that that such workhas to be done more systematically with all of these municipalities.

The second area that I think is important, is the question of improving airquality monitoring infrastructure and capacity. We have air quality monitoringstations that belong to local government, the South African Weather Service,and then our Department, DEFF. So, there are three owners of thisinfrastructure.

On average, at any one time, about 25% of this infrastructure is not in goodworking order. So, clearly, this is an area where we need to be doing muchmore investment. We have been working together with the Weather Service toput together a proper proposal for improvement of all of these weather/airquality monitoring stations.

6/2/2020 DEFF minister Barbara Creecy on key air pollution & climate change issues facing SA | EE Business Intelligence

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We have also been looking at where we can source �nance, either investment�nancing or donor �nancing. We think that this is a very important initiative inorder to have correct and reliable environmental information on a regular,ongoing basis.

While the information we get is adequate, it could be much better. That is whywe are prioritising investment in upgrading the status of all of these air qualitymonitoring stations. This will ensure they are all online all the time, giving usthe kind of information we need for compliance monitoring and enforcement.

On initiatives to expedite EIAs for renewable energy projects…

Are there any plans to relax the regulatory requirements for environmentalimpact assessments (EIAs) for renewable energy plants that are planned to bebuilt on un-reclaimed mining sites? If so, in which respects, and why?

It is important to start off and say that there are no plans to relax theregulatory environment. Environmental impact studies apply to everybody inthe same way, and there is no law for some and a different law for others.

What we have done is to identify a number of renewable energy developmentzones (REDZ), some of these being in former mining areas. We gazetted eightof these zones in February 2018, and it is our intention to gazette anotherthree zones this year in Emalahleni, Beaufort West and Klerksdorp.

To speed up EIAs, we commissioned the CSIR to undertake what we call“strategic environmental assessments” in these zones. The advantage of thisis that we have then already done a pre-assessment of environmentalsensitivity. So, when somebody wants to apply for an EIA in these areas, wehave already done part of what they would have to do anyway. This reducesthe authorisation timeframe from 300 days to 180 days.

As a result of other work that we have done, we can then further reduce thedecision-making timeframe. So, the current timeframe for a renewable energydevelopment assessment within one of the REDZ is now only 80 days. This isimportant in terms of ease of doing business.

Initiatives to expedite EIAs could be done for other sectors, but we chose toassist the renewable energy sector because this is an important way todemonstrate our commitment as a department to speeding up and enhancingthe renewable component of our energy mix.

On South Africa’s commitment to the Paris Agreement on climate change…

According to the 2019 IPCC Special Report, global coal use in electricitygeneration must fall by 80% below 2010 levels within the next 10 years (by2030) in order to avoid exceeding the 1,5⁰C limit. In addition, according toClimate Action Tracker South Africa’s climate change commitments, are “highlyinsu�cient”.  How seriously does your department, and the South Africangovernment, take the country’s commitments in terms of the Paris Agreementon climate change? Please can you also comment on South Africa’s identi�edpoor readiness to undertake a just transition?

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Both myself and President Ramaphosa are on record as saying that weremain committed to the Paris Agreement and to implementing all of ourrequirements in terms of this agreement. We have a valid nationallydetermined contribution (NDC) to reducing our greenhouse gasses, and weare currently updating our NDC with an intention to submit this before COP26,which we have now heard will be taking place in November of 2021.

This is a 5-step process that involves a review of what has happened to datewith regard to our compliance. From there, the process would involve oursister government departments, the provinces and the non-governmentalsector, putting all the evidence before them and receiving recommendations.At the end of that process we would then be taking recommendations tocabinet.

These recommendations could well include an enhancement of our NDC, but Ithink that at this stage what we would want to say is that we are in thatprocess of review, we are committed to going through with this, we arecommitted to getting buy-in from all sectors, and we are committed tomaking sure we meet all the necessary deadlines.

We have developed a low carbon emission strategy that looks at differentsectors of our economy and the kinds of transition required to meet thetargets by 2050. Of course, the issue that we are currently seized with is howto turn the key aspects of that strategy into implementable plans.

One of the things that I take heart from is the recently released integratedresource plan for electricity, IRP 2019, that substantially increases the amountof renewable energy in our energy mix. This is fundamental to the wholeprocess of transition because, as a country, the majority of our GHGemissions come from the energy sector.

Other important recent developments are that individual enterprises andmunicipalities can now generate their own electricity, and this opens the wayfor a broadening of the energy mix. It also allows individual enterprises toreduce their energy and water footprints, both of which are important in termsof mitigating and adapting to the effects of climate change.

I do agree with concerns that we have not as yet set up the PresidentialClimate Change Commission. However, with two months of lockdown, therehave been other pressing priorities that government has had to address. Butthe fact that there have been delays in setting up the Commission does notchange our commitment.

So, may I conclude by saying that we do remain committed as a country tothe Paris Agreement. We are reviewing our Nationally DeterminedContribution, we want to ensure that we maximise buy-in in the reviewprocess, and we will implement all of our responsibilities in terms of theClimate Change Convention.

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6/2/2020 DEFF minister Barbara Creecy on key air pollution & climate change issues facing SA | EE Business Intelligence

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