Portfolio components (mix)
X- Y plot results for the informal urban area community scenario
8.2 Policy implications
8.2.3 Policy implications
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180 role to play in reducing emissions among low-income communities. Key role players identified in the draft Strategy include the DEFF, DMRE, Department of Human Settlements, National Department of Health (NDOH) and Department of Science and Technology (DST), respective provincial departments, municipalities, industry, non-governmental and community-based organisations.
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181 a) Defining the indigent customer
In South Africa, the absence of a proper definition of indigent customers has rendered programmes such as the SHS, FBE and FBAE inoperable. Associating the term indigent with low-income households living within formal municipal boundaries and listed on the municipal indigent register has resulted in the provisioning of free electricity in rural areas excluding more impoverished families living in informal urban areas. In any case, in most rural municipalities, FBE and FBAE funding are not included in IDPs (Koelble and LiPuma, 2010). DMRE statistics suggest low uptake, as most rural households prefer grid electricity to off-grid systems for several reasons.
b) Improved access to clean and affordable energy
As the discussion in Chapter 2 highlights, in addition to job opportunities and financial resources, the main challenge facing low-income families in rural South Africa is access to modern, clean, and safe energy sources. The early phases of policy reform in the country post-1994 focused on improving access to electricity. This focus was underpinned by the belief that access to electricity was the panacea to ending poverty and addressing imbalances that existed at the time (refer to Sections 2.2).
The majority of households in low-income communities continue to rely on rudimentary and traditional, inefficient fossil-based fuels Figure 39. While some scholars argue that the situation is unlikely to ameliorate given the cultural dynamics associated with fuel use, the scarcity of fuelwood will likely force households in low-income areas to switch to cheaper modern fuels.
he GP and MAVT formulations show that firewood, kerosene, and bioethanol fuel still form part of the energy mix for informal urban areas. This suggests that complementary policy instruments, such as the enforcement of environmental protection and deforestation regulations, should enable the required shift to cleaner fuels.
c) Regulation and environmental protection
Initiatives such as the FBE, the FBAE and IBT appear to offer indirect financial assistance to ensure access to affordable electricity; nothing is being done on the regulation side to discourage the continued use of fossil-based fuels. While the initiatives mentioned above have resulted in increased access, many poor households still do not have access to energy. The continued support for fuels such as candles and paraffin will likely impose additional financial and health costs on the beneficiaries of such schemes. Inevitably, these costs will be passed on to the fiscus and the taxpayer.
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182 The findings in this research also support this claim, particularly that without government support, given the high upfront costs associated with renewable energy sources, it will take a considerable amount of time for poor communities to transition from rudimentary sources of energy to cleaner and safer options. Decision-makers in South Africa could also consider the role of regulation when formulating policies to improve access to clean and affordable energy.
d) Technological advancement
Past technologies underpin most existing energy infrastructure. In light of the predicted climate change events, which are likely to increase in their severity and frequency, technology choices implemented today will become legacies in the future (refer to Chapter 6). This further supports the prominence of considering the implications of technological developments over the life span of deployed technologies.
Several technologies, such as fuel cells, are still maturing. These technological advancements would increase the efficiency of energy general and consumption systems together with reduced lifecycle costs over time. In addition, most emerging energy generation technologies are largely environmentally friendly. Therefore, it is important to consider the total lifecycle costs of technologies when making investment decisions. Decision-makers should be aware of the fact that significant up-scaling and deployment of renewable technologies is critical for the realisation of the expected cost reductions. This information would assist the DMRE in reconfiguring policies and scenarios for initiatives such as the non-grid electrification programme.
As the scenarios in Chapter 6 and Chapter 7 suggest, an alternative approach to increasing energy access to low-income communities in the age of technological advancement would be to develop climate-proof portfolios anchored on the micro-grid model that are most appropriate for a specific community. The electricity sector, especially Eskom, would benefit from a greater understanding of the impact of decentralised micro-grid systems on existing centralised infrastructure. For example, the planning of transmission lines and supporting ancillary infrastructure would need to be reconfigured to account for the emergence of decentralised micro-grids.
e) Empowering women and girls for inclusive development
If allowed to continue and nothing is done to energy mixes, the status quo implies that gender disparity, especially in low-income communities, will persist. (refer to Section 1.1 and Section 6.7.3) The lives of women and girls will continue to be characterised by a lack of access to