ON 31ST OCTOBER 2021, A WEEK before COP27 in Egypt, South Africa’s oldest standing coalf ired power station, Komati, was closed. Commissioned in the early 1960s, Komati, rated at 1GW, formed part of the extensive network of coal-fired power stations which account for over 85% of the national energy mix. The closure has been tied to plans to repower and repurpose the facility, utilising renewable energy technologies.
This is the flagship initiative of Eskom’s Just Energy Transition (JET) plan. However, there are concerns around consultation of workers at Komati, and their security, casting a shadow over triumphant media reports on the new dawn for South Africa’s energy transition. The plans for Komati have received partial support from a larger package deal called the Just Energy Transition Partnership (JETTP), valued at $8.5 billion. With support from France, the UK, US and Germany, its objective is to accelerate the transition away from coal use. South Africa’s negotiators remained tight-lipped during the year of negotiations on the package, while civil campaigns emerged, such as Fair Finance Southern Africa, calling for transparency and due public consultation.
These intense debates over the energy transition stand sharply against the deepening crisis facing Eskom. Decades of underinvestment in maintenance and new generation capacity, alongside extensive public-private networks of corruption and extortionate coal prices, have led to a decline in Eskom’s operating performance. By the end of November 2022, over 1,900 hours of load shedding will have affected the economy since the beginning of the year.
Plans for Komati
At the time of its closure, Komati’s performance had fallen to only 121MW, illustrating some of the challenges it faced. The plant employed over 600 people, with almost half outsourced as contractors. Like most of the power stations in Mpumalanga, the site had high levels of unionisation and a stable workforce, a sizeable number of whom had held posts for over a decade.
Eskom’s plans for Komati include repowering the existing infrastructure using solar photovoltaic (PV) and battery storage systems. The extensive plans also aim to generate employment by establishing agriculture and aquaponic projects. They include a skills development centre aimed at providing necessary retraining programmes for workers, geared towards renewable energy systems. In August 2022, Eskom signed a memorandum of understanding with the Cape Peninsula University of Technology for the skills training facility, aimed at technicians and artisans, to be developed over a 36 month period.
Workers left out
When Eskom announced the pending closure of the plant, it continuously insisted to the media that its workers would not lose their livelihoods and would be re-deployed to nearby stations. What they failed to acknowledge was that this agreement did not extend to the hundreds of outsourced workers, divided across many different work roles and labour brokers. From February to June 2022, I led a team with the Institute for Economic Justice, invited by the National Union of Mineworkers, providing support for a group of workers on issues relating to the transition at Komati. The majority of the group were outsourced workers, providing a range of services from plant maintenance to cleaning. They consistently expressed anger and confusion around the looming closure – many had not been consulted at all.
In June, journalists from Workers World Media platform Elitsha visited Komati, interviewing workers and observing efforts to prepare for the decommissioning. The prototype of another of Eskom’s repurposing plans, the development of a Microgrid Assembly operation, was seen in a yard outside the main gates. The solar microgrid system, built on top of a shipping container, is designed to serve rural electrification applications for up to 20-25 households. Several workers indicated they didn’t know much about the system or who was directly involved. Some had seen a private company install the physical unit. This raised questions about the plan: which private companies are driving the new repowering and repurposing initiatives at Komati? Would workers who are employed still be hired by Eskom or by someone else? Would accrued employment benefits carry over?
By July, the first tender for private energy developers to build, operate and maintain an agrivoltaic plant at one of the designated Komati sites had closed. An agrivoltaic plant is a mixed-use, solar PV plant, integrated with agricultural production underneath and interspersed with between-panel arrays. The IEJ attended a tender briefing meeting. We discovered that successful developers would not be required to make specific provisions to incorporate Komati’s existing workforce.
The $8.5 billion plan
Just days before the commencement of COP27, the World Bank Group President David Malpass visited the newly decommissioned Komati, to celebrate its closure and the approval for a R9 billion finance package to support the planned transition activities. He claimed it represented “important steps to repair the ailing energy sector and provide reliable access to electricity”. This came in anticipation of the launch of the South African government’s Just Energy Partnership Investment Plan (JETP-IP) which was handed over at COP27. Defying expectations of a grant-heavy deal, 97% of the agreed plan consists of concessional loans, commercial loans and guarantees for further loans. Only 3% is allocated for grants, with a paltry sum left to address the heavy social cost of the changes on the horizon.
The plan calls for the implementation of an accelerated Independent Power Producer programme. The investment funds are aimed at developing enabling infrastructure to scale up, with the addition of private renewable energy-based generators for electricity for general consumption, and green hydrogen fuel production aimed at European markets.
This model has been described by civil society organisations Trade Unions for Energy Democracy and the Alternative Information & Development Centre as little more than a green structural adjustment programme – neoliberal reforms which advance public-private partnerships. In this framework, the state and the public absorb tremendous risk, while the private sector captures the profit securely through economic rents. The concept of a Just Transition that emerged from the labour movement is being incorporated into green-washed plans by heavy polluting industries and private equity funds.
All eyes on Komati
On 18th November, the United Front (UF), a coalition of several community organisations and trade unions, and the Centre for Sociological Research and Practice at the University of Johannesburg, released a report expressing public concern about the social-economic impact evaluation of Komati’s closure. The report condemns the approach to the Just Transition as top-down, elitist and biased towards powerful stakeholders. It raises questions about the rapid decline in employment between 2020 and 2022 that their study observed, and highlighted the concern for contract workers.
The JETP-IP model, being trialled and experimented with South Africa, is also on the negotiating table with the Indonesian government (currently discussing a deal of $20bn), Senegal, Vietnam and India. The World Bank, and the western block of nations advancing the JETP model, are eager to point to the progress made in South Africa to demonstrate a viable pathway for North-South partnerships in the energy transition. At COP27, participants from the international labour movement adopted a cautious approach, expressed by Diana Junquera Curiel, IndustriAll Director Energy Industry and Just Transition: We are going to be watching the implementation of these JETPs very closely – particularly the first live example, at Komati in South Africa. If this project is successful, with a genuine just transition for all the workers in the value chain, it will provide a pathway to climate finance that will be emulated around the world. If it fails, trust will be broken, and we will be further than ever from our goals.
Many questions echoed on site and periodically in newspapers and radio stations across the country in the months leading to the final closure: what would be the mechanism for filling new posts in the coming activities? When would the new projects begin; and of course: what happens to outsourced workers? Who takes responsibility for them? What about the broader community? These concerns seem to have failed to impact on the authorities, as the victorious news story of Eskom’s leading efforts to address climate change An agrivoltaic plant – a mixed-use, solar PV plant, integrated with agricultural production underneath. Private energy developers have tendered to build, operate and maintain an agrivoltaic plant at one of the designated Komati sites. developing enabling infrastructure to scale up, with the addition of private renewable energy-based generators for electricity for general consumption, and green hydrogen fuel production aimed at European markets. was promoted.
Unfortunately, many fundamental issues appear baked into how the JETP has already been approached in South Africa. Reality appears far from the progressive calls for “System change not climate change”. The energy transition runs the risk of entrenching historical patterns of inequity, overindebtedness of economies in the Global South and the liberalisation of the economy. It would mean that we remain a permanent destination for equipment from the very economies who benefited from heavy fossil fuel-based industrialisation in the 20th century.
What happens to Komati, its workers and the community around it is very significant for the meaning of a “Just Transition” at home and abroad. We must challenge and highlight every issue we uncover and ensure Komati does not become a ghost town to haunt and hollow out genuine campaigns for Just Transition for decades to come.
Brian Kamanzi is an Energy Policy Research consultant with the Trade Unions for Energy Democracy (New York) and a Research Associate with Institute for Economic Justice (Johannesburg).