The move towards renewable energy will impact politics within many countries, particularly Brics member states, as the need for skills and labour shift, according to CEO of African Rainbow Energy and Power (AREP), Brian Dames.
AREP is chaired by billionaire businessman Patrice Motsepe and focuses on renewables, gas, hydropower and coal on the continent and in South Africa.
Dames, a former Eskom CEO, is co-chair of the Brics Business Council’s Energy and Green Economy Working Group and addressed a Brics energy forum in Sandton on Tuesday.
At the event, which served as a precursor to the second summit of the developing economy group of Brazil, Russia, India, China and SA, he warned that the change experienced by the energy industry “ threatens to destroy many aspects of what we know”.
“And the question would be, what do you do with the workers and the consumers and that is most of the people in the world that are voters, how do you learn new skills, how would we find new employment,” Dames said.
He added that the shake-up in the energy industry globally will change countries’ politics, and will potentially exasperate the sense of disenfranchisement people feel.A day after Eskom revealed a R2.3bn loss and R19bn in irregular expenditure in 2017/18, Dames said that the future of power utilities globally is uncertain as their revenue models are “in a death spiral”.
He maintains that energy firms “will be on the frontline of political and financial transition” when new technologies are adopted. He said the business models of firms for low carbon technologies need to scale up very quickly.
Brics countries leading energy transition
According to Dames, the Brics countries are leading the energy transition but the push for reduction in greenhouse gas emissions will take decades as energy infrastructure is capital intensive.
He foresees electric cars revolutionising the automotive industry but says it is too soon to say how they will impact the demand for oil which he believes will remain strong for the next ten years, before moderating.
“Global energy systems are evolution. Evolution, not a revolution,” Dames said.
Dames also pointed out de-centralised grids as the future of electricity as increased numbers of households and businesses internationally generate power through solar panels on their roofs.
In SA, organised labour has objected to government’s move towards renewables energy, calling for a “just transition” to avoid job losses.
The National Union of Metalworkers (Numsa) tried to interdict the signing of the Independent Power Producers (IPPs) agreements in March and argued they would cost 30 000 jobs in the coal sector.
Government signed the 27 deals in April and said these would generate close to R56bn in investment and 61 600 full time jobs.
The National Union of Mineworkers (NUM), an ANC ally, threatened to end its support for the governing party over the signing of the renewable energy agreements.