Green groups challenge go-ahead for new coal IPPs

Johannesburg - The legal battle between coal independent power producers (IPPs) and environmental groups escalated on Monday, when the groups announced they would ask the courts to set aside environmental authorisations for two new coal power stations in South Africa.

The proposed KiPower and Khanyisa coal power stations received the go-ahead from Environment Minister Edna Molewa, despite not completing climate change impact assessments.

Kuyasa Mining and its subsidiary KiPower have indicated they will oppose the litigation; the Department of Environmental Affairs also believes an environmental impact assessment (EIA) as currently stated in legislation is sufficient.

The challenges come after the North Gauteng High Court delivered a landmark ruling in March, which stipulated that a climate change assessment has to be done for any new coal-fired power station in South Africa.

The Centre for Environmental Rights (CER) and environmental justice organisation groundWork have approached the court to set aside Molewa’s authorisations for the two new coal-fired power stations. The organisations argue the projects can't proceed without a full assessment of the climate change impact of the plants.

The March ruling said that the proposed 1 200 MW coal-fired power station Thabametsi could not be completed until a climate change impact assessment was conducted. The CER said the ruling established there is a legal obligation for Molewa and her department to ensure environmental assessments are carried out for projects such as coal-fired power stations before giving them the green light.

CER attorney Nicole Löser said the stance taken by the minister and her department, namely that there is no legal basis for a climate change impact assessment, is clearly incorrect, and directly contradicts the findings of the Thabametsi case.

“The law is clear that neither KiPower nor Khanyisa can be allowed to go ahead without a full climate change impact assessment. The Life After Coal Campaign will challenge any potential power plant that fails to assess these impacts,” she said.

Tina Costas, a director at law firm Norton Rose Fulbright, believes that in future all new coal-fired power plants will be subject to a climate change impact assessment.

"This is certainly the outcome of  the judgment," she said. “But the requirement to undertake a climate change impact assessment during the environmental process will not only be limited to coal-fired power stations. Any project that results in significant greenhouse gas emissions will be required to undertake the assessment prior to the issuing of an environmental authorisation." 

She said this is not a new requirement. "In the Thabemetsi judgment the court correctly stated that in terms of NEMA (the National Environment Management Authority), climate change impacts are relevant factors which must be considered before granting environmental authorisation."

Khanyisa’s environmental authorisation was issued in 2013 and KiPower's last year.

“Following the Thabametsi judgment, it became clear that, despite its earlier authorisation, Khanyisa – which would operate and emit GHGs (greenhouse gases) until 2070 at least - could not be allowed to proceed without conducting a climate change impact assessment,” Löser argued.

The CER believes that neither KiPower nor Khanyisa’s EIAs contain a comprehensive assessment of the climate change impacts of the plants. CER said both EIAs identify that there are no economically feasible options to mitigate the plants’ emissions.

“Both KiPower and Khanyisa – given the technology that they propose using – are anticipated to be significant emitters, as Thabametsi’s climate change impact assessment has shown,” the CER said.

Thabametsi and Khanyisa are projects under the government’s Coal Independent Power Producer Procurement Programme. Thabametsi and the 600 MW Khanyisa projects were both selected in the first bidding round of the programme.

The 600 MW KiPower power station near Delmas will be developed by companies Kuyasa Mining and KiPower. It did not submit a bid under the first bid window of the Coal IPP Procurement Programme, but has indicated it will bid in a possible second round.

The IPP programme also requires both Thabametsi and Khanyisa to reach financial close before the end of the year, and to commence operating by no later than December 2021. In the interim, they have to sort out numerous outstanding licences and pending legal issues, the CER said, before they could seal the deal.  

A climate resilience assessment of Thabametsi, published in January 2017 by environmental consultancy Savannah Environmental, identified several key climate-related risks to the plant.

Löser said the government respondents in the Khanyisa case now have until September 29 2017 to file the record of decision, the information that was before the minister and Department of Environmental Affairs when they made the decision that the power station could proceed.

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