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Monica_55905 Jul 16

I&M: PTX – Laying a Pathway to Achieve Social Justice and Carbon Neutrality

I&M: PTX – Laying a Pathway to Achieve Social Justice and Carbon Neutrality image
Major corporations that influence economic performance are changing their utility structures to meet the growing desire to be carbon neutral through energy diversification whilst playing a greater role in their communities. 
Our esteemed panel moderated by Simon Currie, Principal, Energy Estate grappled with how major corporations can lay a pathway to achieve social justice and carbon neutrality. We were privileged to host two senior speakers from Sasol, Kribs Govender, Vice President Business Development, Technology, SHE and Shamini Harrington, Vice President: Climate Change alongside Alex Marshall, Group Marketing & Compliance Director, Clarke Energy, and Mike Peo, Head, Infrastructure, Energy, Telecommunications, Corporate & Investment Banking at Nedbank.

After succinct introductions, our panel dived straight into the content with the Sasol team discussing how Sasol is going to better incorporate renewable energy into Sasol’s operations and grow a PTX business. Shamini frankly states that as the second-largest greenhouse gas emitter in South Africa Sasol has recognised the importance of an energy transition for the business. Through a three-pillar emission reduction framework, initially looking to reduce emissions using the current technology, by 2030 Sasol will be looking to bring in additional gas power to transform operation, whilst in the long-term shifting the company’s portfolio into lower carbon businesses. 

Shamini highlights the Sasol’s energy demand is circa 1200MW’s, of which 600MW’s is self-generated with the difference coming from the grid, this profile is something Sasol are motivated to change, having identified the role energy can have in stimulating growth, employment, and social development – so how are Sasol going to change this profile?

Kribs outlines the strategy, and simply they are looking to reduce the amount of energy used from Eskom and shift this towards renewable energy suppliers, it sounds simple and action like this will reduce circa 3% of the companies' CO2 emission via Eskom generated power. The process is well underway with an RFI being issued and completed in June, before the company develop and procurement programme ready for Q1 2020.  Importantly, Sasol will also be going to market with RFP’s for smaller 10MW projects at a few of their facilities to being getting communities involved and familiar with this new form of energy. 

Mike weighed in outlining the Sasol are very much on the right track, there is no magic wand to transition overnight, and this will take time. Alex agreed that South Africa is one of the most challenging markets due to Eskom circa 80% coal-based generation, and Sasol making a push towards gas would enable them to open up the market for a lower carbon future in South Africa. 

With pressure around the world for financiers to step back from non-renewable energy sources, wholly and immediately, Mike Peo explained how financiers are responding to such pressures and how PTX can sit within such responses. Almost every financier on the continent has issued climate change position statements adopting both the Paris agreements goals and UN’s sustainable development goals, and from a board-level down the belief in these ambitions is becoming embedded, the question is now around the pace at which such messages can be achieved. Nedbank have published a policy stating that they will no longer finance thermal coal power generation, mining companies or trading and infrastructure. Alongside this PTX can aid in transitions, it is worth noting that PTX requires renewable energies and water, which can be a constraint for many African States, PTX is coming but not always a ready option right now. 

From Clarke Energy’s solutions provider perspective, Alex Marshall sees power-to-gas, hydrogen, biogas, bio-methane being very important to decarbonise both the power and gas sector and believes Africa is at the forefront of such technologies. Clarke Energy already have installation running on high hydrogen waste gas in South Africa.  Alex frankly highlighted that as things stand waste-to-energy is expensive in comparison to Solar and Wind, despite the benefits of carbon capture. 

As the conversation moves towards a close, our panel look to identify exactly how PTX can impact an increase in the access to energy in Africa. Mike Peo feels the private sector motivation, a significant shift is coming, and it has the potential to greatly impact access to energy.  This shift could perhaps even be accelerated through COVID-19, however is highlighted that the political world still moves slowly and until the public sector truly understands the conversation our panellists have had today it will be difficult and slow. 

Poll: What does PTX mean to you?

Power to Gas                     20%
Green Hydrogen                10%
Power to new revenue       70%


Takeaways
 
  • Energy Transition has to be done responsibly, assessing the pace at which decarbonisation can be achieved.
  • The change will initially be led by the private sector, both as large corporations commit to energy transitions and private sector companies provide solutions, subsequently, public policy will be needed to better enable and accelerate Public-Private Partnerships. 
  • Large Corporations have a great ability to stimulate communities, cultivating job growth, and local economies through their energy procurement and generation programmes.