sectoral economic costs and benefits of ghg mitigation - IPCC

Gina Roos
The highest energy users are clearly the chemical and petrochemical industries, followed by iron
and steel, mining and quarrying, non-ferrous metals and non-metallic minerals, to which coal
supplied 440 petajoules (PJ) directly and electricity supplied a further 167 PJ.
In 1996, a total of 184 500 gigawatthours (GWh) of electricity were produced, after retailing to
redistributors (approximately 70 000 GWh), the majority was provided to industry (51 624 GWh)
and mining (33 071 GWh). While electricity consumption by industry has increased substantially
between 1990 and 1996, electricity consumption by mining has remained relatively constant.
Sectoral Contributions to Gross Domestic Product
Historically, mining has contributed significantly to the GDP, about 7.8% in 1997,
(approximately 41.21 billion South African Rands in current prices) as well as 50% of export
earnings. Of this, gold has been the largest contributor at 3.5% of GDP as well as the largest
employer (62.3 % of mining employment in 1997). Coal mining also contributes about a third of
the total mining contribution to GDP (DMEA Mineral Industry Report 1993/1994, quoted in van
Zyl et al., in draft) and currently employs 55 000 people. This has decreased in recent years due
to the move to opencast mining (Lourens, 1998; quoted in van Zyl et al., in draft)). South Africa
is also the third largest exporter of coal (about 64 million tons per annum and 28% of world
production) with clients mainly in the European Union and the Far East with a competitive
advantage in terms of geographic situation and an efficient export transport system. However, the
potential effect of signing the Kyoto protocol on market demand could be severe, reducing future
demand projections by as much as a third (Lloyd et al., in draft). The contribution of
manufacturing and other secondary industries to GDP has increased in recent years.
Mitigation Options
During the course of the Mitigation component of the South African Country Study, potential
mitigation actions have been identified for industry, the coal mining sector and for bulk
electricity supply. This work is still in draft, in particular awaiting comment from stakeholder
groups. A number of potential options were highlighted for discussion in the Climate Change
Policy Discussion Document issued by the Department of Environmental Affairs and Tourism in
1998 (DEAT, 1998). These are detailed below.
In the Industry sector, the options fall into one of two broad categories, energy efficiency and
fuel switching. They include:
• fuel switching;
• equipment changes/ boiler system upgrades;
• co-generation and thermal cascading;
• improved process design.
In the Coal Mining sector all the options identified aim at increasing the energy efficiency per
ton mined. According to Lloyd et al. (in draft), they include:
• higher extraction ratios;
• improving coal utilisation through improved coal beneficiation;
• using discards for combustion;
• catalytic combustion;
• removal of methane.
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