Energy-efficiency measures

The primary short-term focus is on energy-efficiency measures, since they can be implemented quickly and produce measurable reductions. We have continued with the internal energyefficiency programme to save a billion kilowatt-hours. We also work with our consumers to reduce their demand through our demand-side management programme. The short-term target for this nationwide programme is to save 3 000MW by 2012 and 8 000MW by 2025. In reality this equates to about two of our large coal-fired power stations.

Adaptation to the negative impacts of climate change

We accept that global initiatives to reduce CO₂ emissions will take many decades. As such the negative impacts of climate change will become a reality to which we must adapt in order to sustain our business. Adaptation risks in South Africa include an increased number and severity of droughts and floods, human settlement and thus infrastructure movements. Short-term adaptation measures include dry-cooling in our new power stations, which can reduce water consumption by approximately 90%. The trade-off is an efficiency loss and, as a result, an increase in CO₂ emissions. Medium- to longterm considerations include improving the resilience of our infrastructure and staff, by incorporating adaptation issues into long-term planning and risk mitigation strategies. Over the next year we will develop our adaptation strategy. This will be done with input from local and international experts.

Innovation through research, demonstration and development

Research is the key platform for the development and deployment of new carbon-reducing technologies that will result in reductions in greenhouse gas emissions in the long term. Eskom has a proud record of cuttingedge research and development. A number of years ago, we anticipated the need for lower carbon technologies suited to South African conditions. We then initiated projects capitalising on our inherent strengths, building local capacity and associated industries optimised for local conditions. Eskom has and is participating in a number of exciting pilot projects that will achieve this aim:

• an underground coal gasification pilot study that can improve efficiency, reduce environmental impacts and possibly provide a mechanism for the sequestration of CO₂
• a “System Johansson” gasifier biomass pilot for smallscale applications
• a 100MW concentrating solar thermal plant which may overcome the barrier of intermittency and generate a local industry
• hosting the development plant for the pebble-bed modular reactor project, which incorporates modular nuclear technology

Concentrating solar power research If feasibility studies provide satisfactory results in assessing the new technology, we will establish a 100MW pilot concentrating solar power (CSP) plant in the Northern Cape Province. An environmental impact assessment was completed and a positive environmental authorisation obtained from the Department of Environmental Affairs and Tourism in September 2007, while the project feasibility assessment was finalised in November last year. The technology has the potential to be used as a peaking, mid-merit or baseload plant and therefore has significant potential to be expanded as a renewable energy source in our generation mix.

We are developing technology road maps to underpin these technology choices – the coal roadmap has been completed. Roadmaps on other clean technologies are also being developed to guide our research and optimise our resources.

Investment through carbon market mechanisms

We support the carbon market and we are keen to see policy certainty after 2012 for a long-term global carbon market. The carbon market is an essential mechanism to level the playing field by making technologies more accessible and, in turn, inviting sustainable investment into developing countries. We are participating in the clean development mechanism (CDM) (refer here) and view it as a good vehicle to bridge some of the cost gaps, as well as for the wide-scale deployment of low carbonemitting technologies. We are also investigating the application of programmatic CDM in our demand-side management portfolio. This allows for a programme of activities to be registered, in this way reducing costs and time taken for approval. The credits obtained from these DSM activities will be earmarked for further DSM activities, continuing to promote energy efficiency.

Eskom uses a shadow price for carbon to evaluate all investment decisions. Over the next year we will be peer-reviewing our post-2012 strategy. This details different scenarios of the future climate change regime and provides valuable insight into how our climate change strategy should evolve.

Progress through advocacy, partnerships and collaboration

Our response to climate change supports government’s activities. We are active members of the National Committee on Climate Change (NCCC) and participate in the long-term mitigation scenario process. Internationally, Eskom interfaces with leading global organisations that address aspects such as emissions trading, policy directions, post-2012 scenarios, ground-breaking research and business collaboration.

Organisations include the World Business Council for Sustainable Development (WBCSD), the International Emissions Trading Association (IETA), Combating Climate Change (3C), the Global Roundtable on Climate Change (GROCC), Carbon Sequestration Leadership Forum (CSLF), Coal Industry Advisory Board (CIAB), Electric Power Research Institute (EPRI), International Energy Agency (IEA), the International Chamber of Commerce (ICC) and the World Economic Forum (WEF).

We are confident that we have made and will continue to make significant progress in meeting the challenge of climate change. Opportunities and risks have been identified and are being managed pro-actively.

We are also currently developing a “climate change intent”, which will set some key parameters for our aspiration to reduce our relative CO₂ emissions until 2025, and thereafter continually reduce emissions in absolute terms. These parameters will be in support of national and global efforts in this area.

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