The Role of Energy

  1. Electricity needs to be seen as a fundamental human right, and should be free for use to all persons. This is not to say that electricity should be unlimited for use. We live in a world where we need to take account of the effects of electricity provision such as its impact on climate change, the reality of peak fossil fuels and so forth.
  2. We need to look at the impact that exporting goods has the local energy supply market. We have a major problem with regard to the mining and refining of cheap raw goods – such as aluminum – which sees low industrial electricity costs effectively being exported. This is a trend we need to stop: we need to find a way to stop “exporting electricity”. This can be achieved in a multitude of different ways, notably by creating specific taxes that target exporters of raw and processed minerals which utilize our cheap energy prices to create international parity in favor of our exporters. What we are effectively doing is subsiding a capitalist system that is making large profits off of cheap energy provision. While we need to maintain low energy costs for mining and industry, we need to penalize those who utilize this to create a trading advantage on the open international commodities markets. Taxing those who utilize our low energy prices for these purposes will have a three-fold effect: it will contain energy production within South Africa; it will ensure that raw and processed mining products remain in South Africa and can be utilized for domestic manufacturing, thereby stimulating the domestic manufacturing economy (and creating thousands of jobs in the process) and it create a sustainable source of revenue that can be plowed back into infrastructure development, including moving towards sustainable energy production.

 

  1. We need to provide electricity access to rural areas and specifically to commercial farmers. This can be achieved through a number of different mechanisms. Firstly, we can invest in off-grid electricity production such as solar and wind energy to assist rural and farming users of electricity. This will entail a massive roll-out of these electricity generation mechanisms. Secondly, we can impose heavy taxes on agriculture producers who export agriculture goods as well as a land-tax on persons utilizing potential agricultural land for non-agricultural purposes (such as residences, game farms and non-productive farmland). This will have several beneficial effects: it will incentive farmers to re-gear or to simply produce agricultural goods for the local market; it will assist in creating food security in South Africa; and it will help to fund roll-out of sustainable energy initiatives.
  2. We need to consider that we are living in an era of peak oil and will soon reach peak coal. We need to move from living in a society of cheap energy based on the current abundant availability of coal, which is used to feed most of our energy production. There are several things that need to be done in order to move off our current trajectory and reliance on cheap coal. We need to invest massive amounts of funding on the roll-out of sustainable energy. There are several proposals to pay for this – the most feasible are taxing exports of raw and processed minerals which are reliant on the provision of cheap energy. We also need to begin stock-piling coal in order to ensure energy security, as well as to allow us to transition to a more environmentally sustainable form of energy production.
  3. We need to go further in addressing the fact that our reliance on coal has made us the worst in the world in terms of carbon emissions per capita internationally. This can be achieved through two different mechanisms. Firstly, we need to provide tax exemptions for producers and supplies of renewable energy sources, such as the provision of solar energy. We also need to create tax exemptions for those choosing to use these sources. Secondly, we place taxes on those – especially in large industry – who do not take measures to integrate sustainable energy production – as a very simple example, we should incentive industry to utilize solar energy to run their basic energy requirements such as light provision.
  4. One of the major social and environmental issues with regard to energy production in South Africa is coal. Currently we live in an era where coal is in the hands of private corporations. Given the importance of coal to our national energy production and energy security, this is a situation that must be addressed. What also needs to be addressed is the price of coal and undertaking long-term planning with regard to coal production and supply. We currently face a situation where locally mined and processed coal is sold to Eskom at prices that are higher than coal availably on the international market; however, due to negotiated agreements with the coal producers, Eskom is required to purchase coal from these sources at these specified prices. In the short-term what we need to do is to lower the input costs of coal supply. In the medium term, we need to nationalize coal production and refining. However, this must go in hand with moving away from our reliance on coal as the primary method of generating electricity.
  5. We need to re-open the debate regarding so-called ‘fracking’ of gas reserves in the Karoo. We need to balance gas production, energy security and careful handling of the environment.
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