Mpumalanga Business 2023-24

A REGIONAL OVERVIEW OF

A REGIONAL OVERVIEW OF MPUMALANGA PROVINCE The Sand River flows through the Sabi Sand Nature Reserve before joining the Sabie River in the Kruger National Park. Credit: Julie Olivier The transition away from coal and other fossil fuels presents a huge challenge but in Mpumalanga a series of innovative and bold partnerships is tackling the task head on. South Africa’s biggest wind farm project has also begun in the province previously known for coal and power stations. By John Young Partnerships are springing into being in every sector of the economy. Whether they are between government agencies, research institutes or between local and international companies, collaboration is all the rage. And the province of Mpumalanga is leading the way. With Mpumalanga’s economy being so strongly geared towards coal (in mining and for energy generation) it makes sense that actors in a variety of sectors should be finding ways to work together to transition to a greener future. At national level, President Ramaphosa was an invited guest in June 2023 to the Summit for a New Global Financing Pact in Paris, partly at least because South Africa is partnering with several European countries and international institutions in green financing arrangements. Various other countries are taking their lead from the Just Energy Transition Partnership whereby South Africa will get .5-billion in financing provided by France, Germany, the United Kingdom, the United States and the European Union. Separate to that deal, the prime ministers of the Netherlands and Denmark came to South Africa to sign an agreement to start a green hydrogen fund to be known as the SA-H2. Concession funding from the Netherlands will also be made available for water and energy infrastructure while MPUMALANGA BUSINESS 2023/24 12

SPECIAL FEATURE Mpumalanga’s Grootvlei power station, earmarked for closure or conversion, will be the site of a pilot project focussed on growing food in greenhouses, hopefully providing jobs for those who lose their jobs related to coal. Sasol is engaging in new partnerships with increasing frequency, as outlined in some detail in the Oil and Gas sector overview in this journal. From green hydrogen to sustainable aviation fuel (SAF), South Africa’s biggest chemicals and energy company is signing agreements with Germans and Danes while cooperating with entrepreneurial technical startups out of Oxford University. The field is ripe for innovation and partnerships are speeding up the process of discovery. MTN, Huwaei and Minetech Smart Mining are working together in a 5G pilot project at an Mpumalanga coal mine. Even in winding down old resources, partnerships have been chosen as the preferred method. A Mine Water Coordinating Body (MWCB) has successfully been launched to help manage the after-effects of the closure of mines and power stations. Many of Mpumalanga’s coal-fired power stations are either in the process of being closed or will shortly be shut down and the same is true of some coal mines that have reached the end of their lives. Eskom, together with mining houses Exxaro, Glencore and Thungela Resources, formed the MWCB to address environmental and socioeconomic challenges that might arise. Issues such as water also fall under the ambit of a broader mine-industry related coalition known as the Impact Catalyst which has been launched in Mpumalanga. Local green moves The Provincial Government of Mpumalanga has established the Mpumalanga Green Cluster Agency to bring together government, academia and industry to create the environment for businesses to develop in a green economy. The Cluster, an initiative of the Mpumalanga Department of Economic Development and Tourism with the support of GreenCape and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), has joined the International Cleantech Network, a group that has 15 000 businesses affiliated to it across the globe. National utility Eskom is also moving into the new era, partly through a process whereby the entity will be broken into three more competitive units, but more immediately through the announcement of 18 winning bids from independent power producers (IPPs) for renewable projects on Eskom land, 4 000ha of which the utility has made available for this first phase. Eskom owns 36 000ha in the province. A total of 1 800MW will become available to the grid and it will be cheaper to transmit because the solar or wind plants will be right next to the existing Eskom transmission lines. Ten coal plants are due to be closed by 2040, with four Mpumalanga plants (Hendrina, Grootvlei, Camden and Komati) first in line. Eskom is undertaking studies to assess the potential impact on local communities of these closures. Options to get these plants producing energy again include gas, biomass and hydrogen but it is possible they might be used for something quite different. Eskom wants to be a net-zero company by 2050. National government’s Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) has seen the investment into this totally new sector of more than R200-billion since 2012 and South Africa is now home to 112 IPPs, whereas just 12 years ago there were fewer than 40 in Sub-Saharan Africa. The relaxation by national government of the rules regarding setting up a power plant of 100MW or less is well suited to the requirements of big timber-processing companies such as Sappi and PG Bison and all the large mining concerns that are active in Mpumalanga. Sappi is a partner in a 25MW biogas energy facility at it Ngodwana Mill. Investment options Several infrastructure investment projects in the tourism sector have been put forward by the Mpumalanga Economic Growth Agency (MEGA). There is a special focus on BRICS countries and the province was glad to welcome the announcement of a new flight into Kruger Mpumalanga International Airport in 2022 by the tourist division of Lufthansa, Eurowings Discover. The TRILAND partnership with Eswatini and Mozambique is another avenue, as is the collaboration with KwaZulu-Natal, Eswatini, Mozambique and the Seychelles. 13 MPUMALANGA BUSINESS 2023/24