Mining's green revolution: South Africa's energy transition opportunity
Blessing Manale
In South Africa we have lived through an “energy and mineral complex", which entails that the extraction and processing of mineral resources, for energy production like coal, oil, and uranium, are deeply intertwined with the broader energy sector; most notably recently highlighting the significant role of mining in the country's energy production and overall economy.
While South Africa’s high dependence on fossil fuels makes it particularly vulnerable to the emerging energy transition, it’s abundance of untapped renewable energy potential means the country is also well placed to benefit from the global transition to a low carbon economy. Driven by deteriorating energy security, the exacerbated impacts of climate change, and a concern about livelihoods in the fossil fuel sector, the just energy transition has become the pollical- economy dialogue flavour of the day – but somehow a bittersweet taster for all and sundry.
This week, the City of Cape Town hosts two gatherings with a similar agenda – Mining and Development.
The Alternative Mining Indaba (AMI) attributing itself as is a global safe space for stakeholders to discuss, debate, highlight and provide solidarity for those impacted and affected by extractives, especially mining.The Africa Mining Indaba (AMI) on the one hand brand itself as a pivotal event for mining professionals, investors, and industry, with a focus on fostering long-term economic growth and sustainability, on topics such as technology, sustainable mining practices, and investment.
What I saw was a tale of Indabas and a missed opportunity for all partners to engage, beyond the polarisation by each claiming that they represent the will of the people in future of mining, with even more equal claim for the pursuit of an extractive industry that stands for “people, planet and posterity”.
Africa and the Mineral Energy Complex
With this emerging backdrop, the mining sector continues to be a key industry in South Africa, responsible for both job creation and foreign direct investment into the country. While the mining sector sits at the centre of the discourse around the just energy transition (JET) especially in South Africa, it is also undergoing its own transition by ramping up investment in renewable energy sources and critical minerals that will be fundamental in securing a future green economy.
The Just Energy Transition Investment Plan adopts this perspective, setting out South Africa’s approach and the financing needs and options, to ensure decarbonisation of the economy in a just and inclusive manner, and at the rate identified as necessary to meet our climate action targets through the Determined Contribution (NDC) targets.
The global energy transition has created unprecedented demand for critical minerals. The minerals sought for the transition include minerals like lithium, cobalt, manganese and nickel If we do not act swiftly, Africa risks remaining a mere supplier of raw materials while other regions reap the economic benefits of beneficiation.
Regional collaboration is necessary for Africa to fully realise the benefits of critical minerals, but this requires political will, infrastructure investment, and coordinated policies. South Africa, with its comparatively advanced industrial base, should take the lead in fostering regional collaboration, supporting joint ventures, and ensuring that beneficiation becomes a pillar of Africa’s green industrialisation agenda.
A successful JET will unlock the development of a green economy, where mining both provides vital economic inputs in the form of critical minerals and catalyses job creation, economic diversification, and inclusive growth through investments in the hydrogen economy and renewable energy.
A Business Case for Mining and Energy
A crucial step in ensuring a successful and just energy transition in South Africa will be to deepen the dialogues between the mining sector and social partners with a focus on unlocking equitable opportunities for the country and its people within the transition.
The national discourse around the just energy transition and has largely been focused on risk, often ignoring the massive opportunities for the mining sector and the country within the transition.
The quest to decarbonise through a rapid development pathway to green industrialization must be characterised and balanced by innovative job creation and economic diversification and industrialisation interventions able to draw thousands of people, in particular youth and women, into the economy. Social ownership models involving communities must be visible in the energy and mineral complex and sharing every rand and every risk will ensure that South Africans are able to earn an honest living and this is not a hard ask for a country like ours – which stand tall on its claim of being a developmental state.
The opportunities presented by the energy also include interventions in mining land rehabilitation, adaptation, and resilience, and deepening the sector’s social license to operate. South Africa’s, and Africa, stable economic and political future lies firmly in its potential to seize the opportunity and engage its capabilities to rapidly stimulate and sustain an inclusive economy.
Blessing Manale is the executive director of the Presidential Climate Commission
BUSINESS REPORT