- Eskom has signed a memorandum of understanding with its major coal suppliers Exxaro and Seriti, which will see them develop renewable energy projects at their operations
- Eskom is trying to transition away from coal to renewables, and the companies collectively contribute over 80% of the utility's coal supply a year.
- This comes as the issue of coal has become politicised, with energy minister Gwede Mantashe criticising the speed of the move away from the resource.
Eskom has signed an agreement with its major coal suppliers, Exxaro and Seriti Resources, that will see them develop renewable energy projects at their operations.
Eskom CEO Andre de Ruyter said this agreement will contribute to the utility’s efforts achieve its aim of having a net zero emissions status by 2050. Exxaro and Seriti collectively contribute over 80% of Eskom’s coal supply a year.
The state-owned power utility and the two coal mining companies said in a joint statement that the signing of a memorandum of understanding to pursue the development of the projects would "create employment and re-skilling opportunities for communities living and working at and around their operations, and to take a step towards a just transition to a low carbon future in South Africa".
This announcement comes as the issue of coal has become politicised, with Energy Minister Gwede Mantashe criticising the speed of the move away from the resource, saying it could destabilise the economy just because "we are greedy" for green funding. Meanwhile, government is trying to get R76 billion in funding from the US, UK, and European Union to help the country's transition away from coal.
Eskom itself is trying to transition away from coal to renewables.
"Eskom continues to explore means to lower the cost of coal supplied to its power stations, and this investment allows it to advantage of the low cost of photovoltaic power," De Ruyter said.
Solar photovoltaic panels are expected to be erected at some of the mines and Eskom sites. These projects may be completely off-grid, or use Eskom’s own transmission infrastructure.
Seriti expects to achieve a reduction in CO2 emissions of up to 350 000 tonnes per annum - more than half of its current emissions of 700 000 tonnes of CO2 equivalent through using coal-fired electricity generation.
Its CEO Mike Teke said the coal miner was committed to "decarbonisation and a just transition".
"We recognise that climate change and the need to decarbonise our economies is a significant challenge and imperative for South Africa. But, at the same time, we are very conscious that this needs to be done in such a way that does not destroy our industrial base, or the lives of South Africans that rely on our companies for jobs, enterprise and support."
Exxaro expects to have a reduction in CO2 emissions of up to 130 000 tonnes per annum at its Matla coal mine, "which represents a saving of 70% of the greenhouse gasses with Matla at full production", the joint statement said.
Exxaro CEO Mxolisi Mgojo said the agreement is a significant landmark development in South Africa’s energy transition to a low carbon economy for three of South Africa’s largest players in the mining and energy sectors.