Minister of Trade, Industry and Competition Ebrahim Patel on Tuesday issued a draft Green Paper on the advancement of new-energy vehicles in South Africa.
The term “new-energy vehicles” covers electrified or hybrid vehicles getting their power from fossil fuels and batteries; electric vehicles using only battery (EVs); and fuel-cell vehicles using hydrogen to store energy.
Patel said the draft followed inputs from the seven big vehicle original equipment manufacturers (OEMs) in South Africa and the National Association of Automotive Component and Allied Manufacturers (Naacam), as well as concerns raised by the National Union of Metalworkers of South Africa (Numsa).
The draft will be gazetted during next week for public comment, with the aim of finalising the strategy in only 90 days in order to submit the policy proposals for cabinet’s consideration by October.
“We need to do that with urgency because the reality of climate change is such that countries are setting targets of how many fossil fuel vehicles they want on their roads and we want investors and headquarters of OEMs to see South Africa putting up its hand very early in the decision-making process about where production will be located in future.
“You miss that bus, then others would have a consolidated presence in the electric vehicle market,” he said.
Patel added that it was also necessary to “step up efforts to build full EVs in South Africa”, in order to maintain the local industry’s capacity to export to key markets, such as the European Union (EU) and UK, where the plan is to stop selling fossil fuel cars by 2035.
Patel said his department has mandated the Industrial Development Corporation (IDC) to work with the Department of Science and Innovation on achieving its road map and it will appoint a panel led by Dr Johann van Zyl, an experienced global carmaker, to finalise a report on the actions that needs to be taken to realise the electric opportunities for South Africa.
Patel said a nickel sulphite facility has also been established in the North West, using by-products of the platinum group metals (PGMs) mining process to create components for lithium-ion batteries, used in electric vehicles.
But he pointed out South Africa is well-positioned to become a key player in the green hydrogen energy economy, with the country’s reserves of platinum group metals used as a catalyst in green hydrogen fuel cells and vanadium used in battery storage technologies.
Patel said that South Africa’s first fuel-cell factory had started production in the Dube Trade Port, in KwaZulu-Natal.
He noted the proposed project between Sasol and Toyota to explore the use of fuel-cell technology along the N3 corridor between Durban and Johannesburg.
End of the ice age
The sudden urgency from government ties in with predictions made in 2017 by independent U.S. thinktank, RethinkX, which predicted that a ten-fold saving in costs and exponential improvements in range and power of electrical vehicles will drive disruption in transport from 2021.
RethinkX predicted that transport-as-a-service (TaaS) provided by fleets will soon start replacing vehicle ownership in the U.S., so that by 2030, 95% of all U.S. passenger kilometres travelled “will be served by on-demand, autonomous, electric vehicles owned by fleets and more than 200 million cars will be taken off American roads”.
The forecast for new vehicles sales in Europe is that new energy vehicles will make up 40% of sales by 2030, and for this number to increase to 80% by 2040.
Three out of four South African manufactured vehicles are currently exported to the EU.
The Green Paper, therefore, looks at ways of expanding the support provided to vehicle and components makers under government’s Automotive Production and Development Plan (APDP), in order to start the production of new energy vehicles.
• The Green Paper is available for public comment at http://www.thedtic.gov.za/wp-content/uploads/EV_Green_Paper.pdf.