South Africa: Perennial Protests, Industrial Action And The Risk To The Security Of Energy Supply

Last Updated: 14 January 2013
Article by Happy Masondo

Introduction

As the country continues to count the costs of widespread industrial action including the loss of lives of mine workers and members of the security police, the long term socio-economic effects are incalculable.

Just as the transport sector reached a much awaited resolution to the impasse between the work force and management, strike action in the coal industry was mooted which prompted the Minister of Public Enterprises to state: "I am deeply concerned about the industrial action that has kicked off in the coal sector".1  

At the time of the resolution of the transport strike action, Eskom had already "lost a day's supply of coal".2  This befalls the energy sector during a time when the security of power supply remains tenuous at best. "The truth that the wave of strikes is everyone's problem, not just the mining industry's, has come home in the country's recent sovereign debt downgrades, which raise costs for Eskom, the municipalities and others, and in the weakening of the rand, which heightens inflationary pressures".3 It therefore seems ill-advised for lobby groups to be protesting against all attempts at augmenting the less than secure supply of energy in South Africa.

Endless fractured debates

During September 2012, the South African Cabinet lifted the moratorium on the use of hydraulic fracturing following a period of fourteen months during which the Department of Mineral Resources (DMR), through the Minister, Susan Shabangu, had imposed a moratorium on fracking in the ecologically sensitive Karoo region. During the period of the moratorium, the DMR is said to have held consultations with all interested stakeholders.  At the same time a task team was established to investigate the feasibility of hydraulic fracturing, its impact on the environment and whether it would in fact create new job opportunities. 

Environmental groups such as the Treasure Karoo Action Group and Greenpeace expressed their deep felt "disappointment with the way the government has handled this, the secrecy around the technical task team that was appointed, the lack of consultation and the fact that nobody has seen the report".4 Without expressing a view on the substance of the arguments expressed by the environmental groups, it would appear that other than an assertion that hydraulic fracturing will pollute scarce water resources, they do not appear to offer any solutions to the impending shortage of energy supply.

The proponents of hydraulic fracturing state that the Karoo has the largest untapped deposits in the world and that exploring the Karoo for commercially feasible shale gas "has been billed as a possible  answer to easing coal-hungry South Africa's energy needs as it moves from the heavy polluting electricity production towards greener sources".5

Shell is one of the companies hoping that the exploration of the shale gas will produce commercially viable quantities of gas in an environmentally safe way to provide security of supply of energy.  Shell has also raised the prospect of stimulating job creation across the economy and add to the fiscus through increased taxes.

At the core of the arguments by the proponents of hydraulic fracturing is the view that this process will be carried out with extreme caution. For a period of between two to nine years and at an estimated cost of US$200 million, an enormous amount of work has to be undertaken before the sinking of any exploration wells. In the first instance an environmental impact assessment and an appropriate consultation process with communities in and around the Karoo area have to precede any exploration of commercially feasible shale gas.

The debate between the proponents and opponents of hydraulic fracturing is not in the least helpful if it does not provide options on how the country is to deal with the shortage of energy in the country.  A failure to provide viable solutions to the energy crisis in the country is akin to fiddling while the country goes into complete darkness. The energy crisis calls for balanced debates.

Could nuclear energy not be an option? 

The Nuclear Energy Corporation of South Africa (Necsa) together with the National Nuclear Regulator (NNR) have not been spared from the wave of protest action besetting South Africa.  Disgruntled Lanseria residents presented a petition at a public hearing meeting of the NNR and the Necsa to stop the plans of the construction of a nuclear contamination smelter in the area. The public hearing was convened by the NNR and Necsa to obtain the views of the community on the planned construction. The residents of Lanseria have asserted that they "have done their research and have concluded that this smelter will harm us".6 

Earthlife Africa has also added its voice to the objections of the Lanseria residents by saying that the smelter would cause far reaching health hazards even beyond South Africa's borders. Together with Earthhlife Africa other activists also made both oral and written submissions to the NNR.  The essence of the submissions by the environmental activists is that exposure to radiation is growing exponentially and the proposed smelter would add to the radiation levels in an already contaminated environment. 

Necsa points out that the fears of radiation needed to be presented to the NNR in a proper context and thus stated that the objections were noted but that NNR still had to take into account all scientific information associated with nuclear waste.  The representatives of Necsa said the smelter was planned for the disposal of the voluminous contaminated waste at Pelindaba.  According to Necsa, the disposal of the contaminated waste would take the form of melting down, "which means separating metals - steel and aluminum - from the uranium".7 

Necsa's plans include the selling off of the decontaminated metal for re-use, while the uranium is then concentrated in a controlled form which can be disposed of by Necsa. According to Necsa the melting down process would be conducted in an efficient and environmentally friendly manner. Necsa finds it incredulous that the environmental activists consider any and all radiation to be bad. Necsa concludes that "we need to make a proper risk-benefit analysis rather than being selective with particular scare-mongering tactics".8 It is incumbent upon all stakeholders not to lose sight of the bigger picture of security of energy supply before they attack each other's ideologies. Even if stakeholders do not ultimately agree, both sides should present balanced views. They should not sow panic.

Conclusion

The country is going through a period of socio-economic volatility, mistrust and combative relationships. The socio-economic and political landscape is more than just about industrial strike action in the mining and transport industries. The upheavals experienced in South Africa have now impacted on the country's ability to borrow money following the sovereign downgrades by rating agencies. These types of consequences will invariably sow panic and increase volatility. .

The country's security of supply is at extreme risk where Eskom, the Department of Energy, amongst other entities, will find it that much harder to borrow large amounts of money for the various infrastructure programmes planned for in the Integrated Resource Plan. South Africa is already in an energy crisis of great proportions. The country does not need any more extraneous factors to exacerbate the energy crisis.

Footnotes

1. "Fracking Fallout: SA Split As Moratorium Dropped", Cape Argus, 8 September 2012

2. "Ibid"

3. "Mine the Gap", Financial Mail, 12 October 2012

4. "Fracking Fallout: SA Split As Moratorium Dropped", Cape Argus, 8 September 2012

5. "South Africa Lifts Freeze on Shale Gas Exploration", The Peninsula, 7 September 2012.

6. "Lanseria resists R20m nuke smelter", News 24, 12 October 2012

7. "Ibid"

8. "Ibid"

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions