Minimum Emission Standards compliance postponement - industry applications: day 2

Environment, Forestry and Fisheries

08 November 2017
Chairperson: Mr P Mapulane (ANC)
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Meeting Summary

The Committee continued with its hearings into the applications by industry for postponements to comply with the minimum emission standards (MES), with submissions being received from Eskom, whose power stations contribute to air pollution levels in South Africa, and Groundwork, a non-profit environmental justice service and developmental organisation working primarily in the areas of climate and energy. 

Eskom said it supported the MES, as the standards were needed to reduce the harmful health effects of air pollution and provide certainty for planning. Power stations generally complied with the MES, but from 2020 onwards the stations would need to complete emission abatement retrofits and be granted postponements to remain in compliance. Particulate emissions from power stations had been significantly reduced in the last 30 years, but there had been no significant changes to sulphur dioxide (S02) or nitrogen oxide (NOx) emissions.

Eskom had adopted a phased approach to compliance with the MES because there was insufficient funding, water, and outage opportunities available in the short term. Eskom’s air quality offset programme would address domestic burning, which was the greatest source of particulate matter in communities near power stations. Dialogue between government departments was needed to unlock conflicting mandates hampering full compliance with the MES -- for example, keeping electricity tariffs low vs the cost of reducing the health burden, and water for Flue-Gas Desulfurisation (FGD). A cost-benefit analysis was needed to prioritise retrofits and channel scarce resources most efficiently. Eskom remained committed to reducing its environmental footprint.

Members asserted that misleading evidence seemed to have been presented by Eskom, and asked if the utility was merely sticking to the relaxed emission standards. Had Eskom made any provision for the decommissioning of its plants, and what strategies were in place for when decommissioning would take place? Would the compliance postponements put South Africa in breach of the Paris Agreement? Had any feasibility studies been done on the life spans of the power stations?

Groundwork quoted Statistics South Africa’s most recent household survey of energy use, and said that what had been revealed was in total contradiction to what Eskom and Sasol were saying about where the majority of air pollution came from. The idea that low income households or dense settlements were responsible for the majority of the pollution did not match the available information. There was no comparison between the scale of emissions from industrial and domestic sources, and interventions to reduce domestic emissions were a responsibility of government and should not depend on offsets. It was particularly galling that government had failed to address domestic emissions in any meaningful way. Excessive air pollution was often a by-product of unsustainable policies in sectors such as transport, energy, waste management and industry. In most cases, healthier strategies would also be more economical in the long-term due to health-care cost savings as well as climate gains.

The Committee asked if offsets had been submitted, and if so, whether the utilities had complied. Concern was expressed that the pilot programmes of Sasol and Eskom were two years into the implementation phase. The Minister had said in 2014 that offset programmes needed to be implemented in a way that could change people’s lives, but the process had been rushed. Communities had not been allowed to decide which offsets were suitable for them, or choose which projects would improve their lives. 

Meeting report

Minimum Emission Standards (MES): Eskom Submission

Mr Christo van Niekerk, Acting Senior Manager: Eskom Technology Group, said that Eskom was committed to achieving compliance with all environmental legislation. It had improved its emissions significantly since the 1980s. Over the last three years, it had spent R6.8 billion on emissions compliance through capital investment, of which 50 % was spent on Medupi and Kusile power stations, and the rest on the existing fleet. Eskom could foresee that expenditure on air quality compliance over the next decade would continue to increase and a further increase in capital investment would be needed to meet compliance requirements.

While there had been progress in emission reductions, Eskom was aware of the effects that the emissions from power stations had on people’s health. It had established an air quality offset programme, the intention of which was to address Eskom’s atmospheric emissions licence conditions. It was committed to the reduction of its environmental footprint and impact, and would continue to do so in future.

Ms Deidre Herbst, Environmental Manager: Eskom said that the company supported the Minimum Emission Standards (MES) as they needed to reduce the harmful health effects of air pollution and provide certainty for planning. Power stations generally complied with the MES, but from 2020 onwards the stations would need to complete emission abatement retrofits and be granted postponements to remain in compliance. She explained that particulate emissions from power stations had been reduced by more than an order of magnitude in the last 30 years, but there had been no significant changes to sulphur dioxide (S02) or nitrogen oxide (NOx) emissions.

Eskom had adopted a phased approach to compliance with the MES because there was insufficient funding, water and outages available in the short term. Its ambient air quality monitoring network showed that generally, there was a compliance with ambient SO2 and NOx standards, but non-compliance with particulate matter (PM)10 and PM2.5 on the Mpumalanga Highveld Eskom’s air quality offset programme would address domestic burning, which was the greatest source of PM2.5 in communities near power stations

Regarding power station compliance with the MES current limits (2015-2020), the Medupi and Matimba power stations needed postponement in respect of S02, although all the other power stations had always complied.

With regard to compliance with the MES after 2025, a retrofit and postponement was needed for the Medupi and Kendal power stations for SO2. Postponement needed for power stations for SO2 included Majuba, Matimba, Lethabo, Tutuka, Duvha (U1-3), Duvha (U4-6), Matla, Kriel, Arnot, Hendrina, Camden, Grootvlei and Komati. Postponement needed for power stations for NOx included Lethabo, Duvha (U1-3), Duvha (U4-6), Kriel, Arnot, Hendrina, Camden, Grootvlei, Komati and Acacia. Postponement needed for power stations for a particular matter included Komati

Ms Herbst said that there had been a more than tenfold reduction in particulate emissions from the Grootvlei power station, which was due to a fabric filter plant retrofit. Eskom’s NOx emissions had decreased by 9% since 2010/11 as a result of the decline in use of the coal-fired fleet, but its SO2 emissions had not clearly decreased over the last six years despite the decrease in energy generated, due to the commissioning of the Grootvlei and Medupi power stations, which both had high relative SO2 emissions

Typical resource requirements and waste production for compliance with the MES for a 3 600 MW power station were capital costs of between R25-28.5 billion, three to six million cubic metres of water a year, more than 400 000 tons of sorbent per annum, and annual running costs of over R300 million. This would result in reduced SO2, NOx and particulate emissions, flue-gas desulfurisation waste by-product (gypsum) amounting to about 675 000 tons per annum, and approximately 165 000 tons of additional carbon dioxide annually. The outage requirements would be up to 150 days per unit.

The cost of achieving full compliance with the MES, based on the current emission reduction plan to 2025 (57% compliance), with an approximately 3% higher electricity tariff, would be an estimated R63 billion. Full compliance including retrofitting of power stations close to the end of their technical life, with an approximately 10% higher electricity tariff, would cost in excess of R300 billion.

Ms Herbst said there were 18 air quality monitoring stations operated by Eskom’s ambient air quality monitoring team in its Research, Testing and Development (RT&D) department, except for Edgemead and Mossel Bay. The network was South African National Accreditation System (SANAS)-accredited.

Eskom’s air quality offset programme had begun in 2011-2013 with a pre-feasibility study. Between 2014 and 2016, there had been a pilot project in KwaZamokuhle involving 120 households in which insulation, liquefied petroleum gas (LPG), clean coal stoves, an electricity subsidy and an electricity starter pack had been tested. This year, 30 households in KwaZamokuhle were participating in an insulation and electricity pilot. From 2018 to 2020, there would be lead implementation with 5 000 households in KwaZamokuhle, Ezamokuhle, Sharpeville, and from 2019 to 2025 there would be a large scale roll-out of at least one settlement per power station, involving 40 000 households.

Lessons learnt from the KwaZamokuhle pilot project were:

  • Domestic burning in KwaZamokuhle accounts for more than 50% of the ambient fine particulate matter;
  • Indoor air quality was determined mainly by outdoor air quality, so interventions in a few houses had little impact on indoor air quality;
  • Mean monthly income was less than R2 000 per household. Households spent around R200-R300 per annum on coal in winter. Affordability drove the energy carrier selection;
  • Residents were very willing to participate in all interventions, and more than 80% did not want their old coal stoves back at the end;
  • Around 30% of households lived in formal dwellings. A solution was still needed;
  • Insulation raised minimum temperatures in houses by up to nine degrees Centigrade.
  • LPG was well received;
  • A stove swap and housing insulation were needed to reduce domestic coal burning. An electricity subsidy without removing the coal stove increased coal use;
  • The poor construction of Reconstruction and Development Programme (RDP) houses posed challenges for the installation of insulation. It was proposed to use a spray of foam in future to reduce water leaks. Draught-proofing was also needed.

Ms Herbst reiterated that Eskom supported the MES because they were needed to reduce harmful health effects of air pollution, and they provided certainty for planning. Dialogue between government departments was needed to unlock conflicting mandates hampering full compliance with the MES -- for example, keeping electricity tariffs low vs the cost of reducing the health burden, and water for FGD. A cost-benefit analysis was needed to prioritise retrofits and channel scarce resources most efficiently. Lastly, Eskom remained committed to reducing its environmental footprint.

Discussion:

The Chairperson said he was shocked that it had taken a World Bank loan condition to get Eskom to comply with South Africa’s legislation. It appeared as if the World Bank was more worried about South African legislation than Eskom itself. He hoped that the presenter would respond to this.

Ms Herbst responded that the World Bank statements were accurate in terms of the pressure they had placed on Eskom. The Atmospheric Emissions Licence (AEL) required Eskom to comply, so from a compliance point of view Eskom was required to register and comply with legislation. She confirmed that Eskom was late with the Medupi sewage treatment plant, and this was due to Eskom’s procurement process. Eskom would therefore start the programme later than expected, but was hoping to finish it by the scheduled deadline of 2025. She clarified that she believed that Eskom was not being pushed by the World Bank.

The Chairperson interjected, and asked what she meant when she said Eskom was not being pushed by the World Bank’s condition? He said that there was an Air Quality Act where the minimum emissions standards had been set and by 2020 all the plants must be compliant. If it were not for the condition, Medupi would have not complied because the presentation required postponements for almost all the plants except the last three. The fact that Eskom was required to submit an application for postponement was because the AELs required Eskom to comply. The Chairperson reiterated that he did not understand what Ms Herbst meant by her statement and sought clarity.

Ms Herbst responded that Eskom had always said that meeting the emissions standards by 2020 would be difficult to achieve. Initially, Eskom had a constrained system, and was not able to take the units for outage, but currently they were not as constrained as they previously were. There were, however, other constraints. The first was the financial constraint of attaining R300 billion to do the retrofits. Secondly, there was insufficient water to operate the plants immediately. The Lesotho highlands water project also had a challenge with the availability of sufficient water to operate the STD plants on all of the power stations. There were also added operational costs. While there were limits set for 2020, Eskom currently had postponements up to 2025 for most their plants for sulphur dioxide, and that had been included in their Atmospheric Emissions License. Eskom therefore affirmed that it was compliant with its AEL because they had been granted postponement.

The World Bank had aligned itself with the requirement to retrofit at Medupi within six years of the first year of being commissioned. Eskom’s AEL was aligned with that requirement. Eskom was further required by the AEL and by the World Bank to comply with the retrofits by 2021-2022. Eskom had applied for a postponement. She responded to the Chairpersons question on the second statement by stating that Eskom generally complied, and it was related to the fact that they could not implement everything all at once. It needed to apply a phased approach in order to attain the necessary resources for the retrofit program.

Mr R Purdon (DA) said that he saw a disturbing picture, and the presentation was extremely concerning. He stated that it was easy to say that Eskom supported the Minimum Emissions Standards, but he found the presentation flowery. He asked if Eskom was complying with relaxed emission limits. The postponements and non-compliance of Medupi were concerning, especially because it was a new plant. He sought clarity on the compliance with the SO2 requirements, where it seemed to be fully compliant, but this was misleading. He was not sensing any sort of urgency and concern because Eskom required postponement for most of its plants. The Medupi compliance was ensured because of the World Bank’s condition -- this was clear, because there were no plans in place for all the other power stations. Why were they no plans to phase out some of the dirty culprits earlier? Had Eskom made any provision for decommissioning plants and the environmental impact assessments (EIAs) to precede this, because was a cost factor? He referred to the Department of Environmental Affairs’ (DEA’s) lekgotla, which had made a statement about the abuse of the MES by Eskom, which was in violation of Section 24 of the Constitution. These were very serious accusations. In light of the delegation that would be representing South Africa at the COP23 soon, would the postponements put South Africa in breach of the Paris Agreement?

Mr T Hadebe (DA) asked whether Eskom had conducted a feasibility study for an extension of the stations’ life spans. Were there decommissioning and air quality improvement plans in place? The Centre for Environmental Rights had noted that Eskom had refused to grant them access to its socio-economic impact assessments for early decommissioning and access to its monthly compliance reports. Eskom was a public entity that should run its operations transparently, so why had there been no access to essential information?

Eskom’s Response

Mr Van Niekerk responded that Eskom had done a study to determine their capacity requirements over ten years, and with their current growth assumption, it was estimated to run out of resources by 2025/2026. He emphasised that Eskom had put implementation measures in place. He responded to the concern on decommissioning by stating that there had been no decision on it. For planning assumptions Eskom relied on specific periods. It had conducted a feasibility study for four stations which looked at a possible life extension beyond 50 years, and that information was available. There were financial provisions for decommissions which were based on the life expectancy of the plants, and that was indicated on Eskom’s balance sheets. Access to monthly compliance and socio-economic impact studies should have been made available and if not, then they would be made available. He pointed out that the studies had been conducted by a third party, and a request would be filed to make them available.

Ms Herbst added that the socio-impact assessments had been done, and that she was unaware that the request for access to the information had been declined. She committed to looking into what the reason for the decline was. Regarding the emission data, the annual emission report had been given, and the issue raised by the Centre for Environmental Rights had been that there was insufficient data. Eskom had taken note of the Centre for Environmental Rights’ statements and suggestions, and would revise the emissions report. In response to the non-compliance that was shown at the Kendal power station, there had been some upset conditions the previous year. Across all of the 90 units, two percent of the time there were some upset conditions. Eskom’s AEL allowed it to have some upset conditions and an allocated time to fix the conditions. The data presented illustrated that Eskom was operating well below the limit. Eskom had improved significantly and had had only had nine incidents at of all their 90 units in the first half of the year, which equates to 0.2 percent of operating in upset conditions.

She apologetically stated that there had been no intention to give a false impression. The green areas in the presentation highlighted the deferments in place, but there were no deferments in place after 2025. Eskom thus considered itself to be compliant, because it had been granted postponements in terms of the legal process followed. She took note of Mr Purdon’s comment on the lack of urgency, saying that Eskom was committed to complying as soon as it could, but it had constraints. She also added that Eskom took note of Section 24 of the Constitution. It acknowledged that its power stations had a negative impact on health and were working on addressing the issue. Eskom was not in breach of the Paris Agreement, and the annual C02 emissions were slightly lower to those of two years ago, which was due to less production.

The Chairperson explained that the frustration of the Members derived from the shocking presentation that the Committee had received the day before, which the current presentation did not address. He referred to the statement of the National Air Quality Officer (NAQO) that it was an offence to submit wrong information to the Department, and the Centre for Environmental Rights had said that Eskom had submitted defective information to the NAQO. The information was defective, because Eskom was required to submit reports daily, but the reports submitted had been monthly reports.

He expressed concern that the atmospheric air pressure reports did not include health impacts, which served as one of the core focuses as to why the meetings were being held. He wanted to know why this was not addressed and what was being done to address the health issues.

Ms Herbst responded that the reports provided included graphs that showed a whole month and within it, it showed daily averages. The daily average was comprised of emissions data, as Eskom had continuous monitoring. It did monitor as it was required to by the AEL, and they did meet the requirements of reporting daily data.

Prof Eugene Cairncross, Environmental Scientist, Centre for Environmental Rights (CER), clarified that that he had received the Kendal reports by chance. However, he could not get the monthly reports for all the other power stations. The request made to access the other monthly reports had been declined.

Mr Maluta Mbedzi, Chief Environmental Advisor: Eskom, said that there was some misunderstanding regarding the modelling process. The reason why Eskom modelled was because it could not measure everywhere in country. The second reason for modelling was that Eskom wanted to estimate the impact of sources that did not exist at that moment. If Eskom were to build a facility, for instance, then it would have been able to estimate the impact which that facility would have before it was built. In the priority areas, there were a complex mixture of sources, and at any given time those sources were mixed and were contributing to the level of pollution in those areas. If the predictions and observations were 1:1, then modellers would have become concerned, as it would have meant that contributions from other areas were zero, which was untrue and impossible. The comparison between predictions and observations that the Professor had raised was not always necessary. Model validation was to get predictions, because monitoring stations were costly, Eskom could not have them everywhere, tsohus the model predictions provided confidence for areas that did not have monitoring stations.

Dr Thulie Mdluli, National Air Quality Officer: Department of Environmental Affairs said that in the initial atmospheric reports that were submitted, there were some information gaps and requests were made to facilities for additional information. The initial impact report did not have a health impact assessment; however, the requirement was met when the information was submitted. The air quality system was still being built, and therefore not all reports were accessible. However, the team was working hard to establish the division in a proper manner to secure efficiency in the system. The other challenge the NAQO faced, because of the legal format of the land, was that the licensing formats were different for different spheres of government -- some made requirements for monthly compliance reports to be submitted, while others required quarterly submissions. It was not uniform across the country, as licensing authorities were different.

The Chairperson interjected and asked if the DEA could not develop standard guidelines for licensing authorities.

Dr Mdluli responded that there were standard guidelines, and reiterated that the system had been developed and facilities were coming into the system over time. Some of the facilities were not within the system. The Department licensed over 1 000 facilities across the country. It was difficult for the Department to deal with huge numbers for costs of compliance – it sought a fully-fledged cost benefit analysis. Different departments needed to be engaged in the conversation so that the government could see how much it would be spending on the health budget as a result of non-compliance.

Mr Z Makhubele (ANC) sought clarity on whether the CER sat in stakeholder forums and meetings. Was their posture investigative, or were they allowed to sit in on those meetings? This would allow the CER and Eskom to reconcile and communicate beyond committee meetings. The CER had highlighted that Eskom needed to tighten the dust monitoring regulations -- this was an area that required special focus, especially around mining areas. Eskom had indicated that it required R300 billion to achieve 100 percent compliance, but the CER had highlighted that Eskom, through the technology it utilises, had managed to significantly save about R107 billion and R1.8 billion savings in operational expenditure. Could Eskom confirm this, and if so, how had these savings been spent? He sought certainty on the lifespan of the plants. What informed Eskom’s budget on upsets? Lastly, if all the monitoring stations were functional, were they efficient and effective? Could one rely on them?

Mr Hadebe asked for a full analysis to determine if full compliance was necessary. The Committee required clarity as to what it meant to have full compliance with the MES. If the feasibility studies were done by Eskom, what impact would it have on improving the air quality? What financial planning had been done to execute those implementations? Why had Eskom not implemented the World Bank’s emission recommendations yet?

Mr Purdon said Eskom had not addressed his question regarding the DEA’s allegations of abuse of provisions. The controversial Thabametsi climate impact assessment had revealed significant greenhouse emissions -- what was the update on this?

The Chairperson said that the Thabamtesi issue had been previously dealt with. There had been a court case that challenged the decision to grant environmental authorisation. The court had ruled that there should be a climate change impact assessment, which the DEA was currently dealing with.

Ms Judy Beaumont, Acting Director-General: Department of Environmental Affairs, responded to the question of how life expectancy had affected the Paris agreements by stating that the extension to 60 years was because the Department did not have clarity from Eskom as to what the plan was. The Department’s calculations were on the basis of a 50-year lifespan for all power plants, and the 60-year plan had brought in a new dimension. There was a proposal for some of the power plants not to be decommissioned after 50 years, but rather at the end of 60 years, and this had an impact on air quality. The Department had calculated the carbon budget that was inclusive of the coal fired power stations in the Integrated Resource Plans (IRP) of 2010, and there was also the inclusion of certain megawatts for Independent Power Producers (IPPs). The policy position was that South Africa’s inclusion in a low carbon economy included a mix of energy sources, but the country needed to transition from dirty power sources to cleaner power sources.

Ms Herbst said that the original budget for retrofits at all of the power stations was an estimated R80 billion. Eskom had explored other alternatives that would be cost effective but still achieved the limits, and the alternative methods had reduced the budget from R80 billion to R63 billion. It was not a significant saving, but it was a saving that was required in order for Eskom to remain financial sustainable. The savings were contributed to Eskom’s overall financial sustainability. Eskom was still exploring and learning what worked and did not work for the offset budget. It was required by the authorities to implement offsets around all power station areas. The cost was an estimated R4.2 billion, which would be spent on the offset project of 46 000 houses executed over the next eight to nine years, and was scheduled to be completed by 2025. She reiterated Ms Beaumont’s statement that Eskom needed certainty and that it would be brought into the Integrated Resource Plan (IRP) of the decommissioning, but there were other aspects which needed to be taken into account on the closure of certain power stations.

Mr Van Niekerk added that Eskom was busy with the last revision of the IRP, and all the life-expectancy considerations would be taken up in the new vision of the IRP. A pre-feasibility study would be conducted to determine the feasibility of extending the life of the power plants beyond 50 years, depending on the IRP requirements. The outcome of the pre-feasibility study would then determine whether a full feasibility study could be conducted. Pre-feasibility studies had been conducted for four of the 13 power stations in full commission. The IRP would be issued in the forthcoming year and at the current stage, there were no plans to decommission any of the power stations.

The Chairperson said there was uncertainty around the IRP. The Committee had been briefed on it sometime in this year, and the DEA had promised that the plan would be ready by August. The date had since been revised and the plan was scheduled to be ready at the end of this year. He agreed that the IRP was urgent and would provide certainty on what South Africa would have to do to comply with the Paris Agreement, and it would provide the guidance going forward.

Dr Mdluli said that the purpose of the presentation was to provide transitional arrangements for the existing agreements to be granted time to comply with the MES. The DEA never intended to allow for rolling postponements. The industry must come into compliance in future. In some cases, the only solution would be to decommission some of the old plants.

Ms Beaumont expressed deep concern, because South Africa’s policy framework included the transition to low carbon emissions and a cleaner economy. Eskom had shown little sign of forward movement and creative thinking. The World Bank had provided funding for a Concentrated Solar Power (CSP) plant, but that funding had not been utilised. The funding was meant to assist Eskom to move into alternative sources of power. The lack of clarity from Eskom undermined a fundamental part of South Africa’s sustainable development policy framework.

The Chairperson shared Ms Beaumont’s concern, because it was at the centre of Eskom’s attitude to South Africa’s legislative regime and policy intentions. Renewable energy and the IPP was part of the energy mix and part of advancing the transition to a lower carbon economy. The attitude that the Committee was getting from Eskom was that it was not willing to live up to the commitment to renewable energy. The Committee still had not had a follow up from Eskom’s leadership. He did not accept the argument that complying to legislation was costly, especially because Eskom had significant resource wastage. The procurement process at Eskom did not promote efficiency -- there was a lot of wastage and corruption, yet the Committee was being told that things could not be done because of financial constraints. It was public knowledge that Eskom paid R1.6 billion to a company called Trillion, and no value was derived from it. This represented Eskom’s bad and arrogant posture. Its management needed to come and report on MES, as the Committee could not accept the rolling postponements.

GroundWork: presentation:

Mr Rico Euripidou, Environmental Health Campaign Manager: GroundWork, said the organisation sought alternatives for life after coal. When it came to offsets, it was important to determine where the pollution was coming from and who was responsible for the pollution. The Air Quality Management Plan of 2012 showed that the largest contributors of emissions were industrial sources, and chief among those were coal-powered generators. The proportion of household fuel-burning was in the minority. What Statistics South Africa’s most recent household survey of energy use had revealed was in total contradiction to what Eskom and Sasol were saying about where the majority of air pollution came from. This did not detract from the impact of industrial pollution. The idea that low income households or dense settlements were responsible for the majority of the pollution was incongruent to the available information. It would be mischievous to say that GroundWork’s efforts should be directed at the domestic contribution to air pollution rather than where the bulk of emissions came from. Both sources needed to be addressed, and the scale of the contribution needed to be taken into consideration. Historically, the government’s efforts to improve people’s lives in terms of domestic emissions had not been meaningful. The main focus had been that a cheap coal-burning device in households would address emissions levels, and although it had been shown to be effective, generally when it was rolled out in households it had very little impact.

If the Committee agreed that Sasol and Eskom had an offset programme in place, then they would be inverting the mitigation hierarchy. It would imply that these utilities had less responsibility for taking action for their facilities, which thus shifted the focus to areas that produced the least emissions. The costs presented revealed that offsets would always be preferred to mitigation, because they were cheaper. The pressure emanated from the rhetoric of the need to cut costs, and that if costs were not cut there would be no electricity. This logic was false. The basis of the offsets was false. Who was responsible for monitoring these offsets? How could these offsets be monitored? Careful consideration of the scale of emissions and who was responsible for the emissions was required.

Mr Euripidou said that if there was an outdoor air pollution problem (as South Africa had) and an indoor pollution problem, then there was a responsibility of acting to address both problems. He emphasised that there was no comparison of the scale of emissions from industrial and domestic sources, and interventions to reduce domestic emissions were a responsibility of government, and should not depend on offsets. It was particularly galling that the government had failed to address domestic emissions in any meaningful way, but over the last decade had tried to do it on the cheap with the Basa Njengo Magogo Programme.

He summarised some of his key concerns:

  • The use of offsets inverted the mitigation hierarchy;
  • Offsets would always be preferred to mitigation measures if they were cheaper;
  • Offsets were used to justify the unjustifiable;
  • Regulatory capacity was inadequate to the task and provided no oversight;
  • The assumption that offsetting compensated for weak regulatory and planning capacity was false. To the contrary, it exacerbated it;
  • Offsets would tempt government to abandon responsibilities rather than build capacity to meet them.

He said that “air quality offsets” were a condition of the Eskom and Sasol postponements. Eskom was supposed to implement an offset programme to reduce pollution in the ambient/receiving environment. An offset implementation plan had been expected from Eskom by 31 March 2016. Sasol was also required to implement an offset programme to reduce PM and SO2 pollution in the ambient/receiving environment. An offset implementation plan had been expected by 30 June 2015. Over a year later, an air quality offset guideline had been published, recommending offsets where MES postponements were granted.

There was a regulatory vacuum while these utilities were benefiting, because the plans had not been implementations of the plan. There needed to be careful considerations of the scale of emissions, who was responsible and the government’s responsibility. The Committee also needed to be realistic about the expense of the health impact of air pollution. At very low levels of pollution, there were health impacts. The last ten years had revealed that emission levels were worsening.

Mr Euripidou said that although Eskom had been granted postponements in 2013/2014 and had been emitting surplus PM, NOx and SO2 in accordance with the relaxed AEL limits, their authorised large scale air quality offset implementation plans, submitted to the DEA in April 2016, remained at the pilot stage (30 houses) with various delays. The obvious conclusion was that in addition to the objection, a properly implemented offset of household emissions could not feasibly counterbalance bulk industrial emissions in general. It clearly was not the case at present. The Department of Environmental Affairs was implicated regarding the timeframe, in that they were permitting the implementation of the air quality offset plan to be dragged out, and Eskom were enjoying something of a windfall at the moment.

Regarding the health costs, the World Health Organisation (WHO) estimated that there were seven million deaths linked to air pollution in 2012. Excessive air pollution was often a by-product of unsustainable policies in sectors such as transport, energy, waste management and industry. In most cases, healthier strategies would also be more economical in the long-term due to health-care cost savings, as well as climate gains. The Department needed to quantify the costs of air pollution.

Mr Euripidou said that particle pollution was one of the most dangerous pollutants for human health. It caused cardiovascular diseases, asthma, hospital admissions and premature deaths. He was unhappy that PM10 and PM2.5 levels in the Vaal and the Highveld had exceeded the national annual standard permanently over the last five years.

He raised the following key issues:

  • Delink between the DEA and the Department of Health (DOH);
  • Track pollution and its effects in real time;
  • MES postponements were responsible for the bulk of emissions;
  • MES standards were not a measure of Best Alternative Technologies/Best Environmental Practices (BAT/BEP);
  • Multi-stakeholder Reference Group (MSRG) meetings had become a finger-pointing exercise;
  • What were the plans for a just transition by Eskom to a renewable energy future?
  • Why were there no decommissioning plans in place, especially for older polluting plants now -- was there an excess?
  • Offsets were unjust – electrify instead.

There were seasonal variations, as data had revealed that there were high emission rates during the winter season. It was not justifiable for significant emission rates to be attributed to domestic households. GroundWork had consistently asked Eskom and Sasol why they have not considered household renewable energy systems. Both utilities had ignored these alternatives energy sources. The implementation of offsets would further create conflict in communities. The Department could not outsource the obligations and competencies of the government. GroundWork asked whether the citizens of the United States better humans than South African people, because Sasol was investing money to comply with US standards, but failing to comply with South African standards. Lastly, what tools were in place to verify the information that was being submitted by these industries?

GroundWork concluded by seeking clarity on the process for postponement applications. What was the major role of local quality officers in the postponement of applications because they had atmospheric licences that they could not enforce. Secondly, the past ten years had not shown capacity building at the local level. Lastly, there had not been a roadmap that displayed how Sasol and Eskom would achieve compliance. GroundWork had nagged these industries but they had not provided the necessary information. The level of engagement was one-sided. GroundWork had also engaged with government at different levels, but had not seen any progress. It relied on the Committee to play an oversight role in ensuring that both Sasol and Eskom complied.

Discussion

The Chairperson said interactions with the communities were always passionate because they lived these experiences and were affected daily by the impact of pollution. This perspective was refreshing, because the issues were not abstract. He asked if offsets had been submitted, and if so, had the utilities complied? Sasol and Eskom had indicated yesterday that they had pilots. He expressed his concern with these pilot programmes because they had been two years into the implementation phase.

A Member said in 2014 a meeting had been held with the Minister of the DEA, at which the Minister had said offset programmes needed to be implemented in a way that could change people’s lives. However, the process in Zamdela had been rushed. The community had not been allowed to decide which offsets were suitable for them. This was a concern, because the community was not allowed to think about and choose which projects would improve their lives.

Ms Estelle Marais, Senior Manager: Environment: Air & Greenhouse Gas (GHG), Sasol, compared the situation in the US against that in South Africa, and said the context of the two environments were different at this point of time. South Africa had old plants in comparison to those of the USA. Except for SO2, Sasol would comply with new plant standards by 2025, and it was working on achieving that. She confirmed that no money had left South Africa to fund USA facilities. There had been three sources of funding. The first source was a $4 billion project loan which Sasol had raised on the market. The second was $3 billion in debt funding, which came from the Sasol Group –a loan which would have had to be paid back once operational. The third was equity, which was received from existing offshore operations, as Sasol had operations in 37 countries worldwide, although it was headquartered in South Africa.

On the question of offsets, Sasol welcomed the feedback. If the process appeared to have been rushed, Sasol apologised for that. Plans would be reviewed going into the future, and the concept of household renewable solutions was a concept that would be explored. Offset programmes involved a very intensive consultation process, and Sasol was very pleased with the outcomes. The programmes were focused on four key areas: waste burning, veld fire management, RDP houses, and costs in the region of R1 billion for the period up to 2020.

The Chairperson said that Sasol was responding to the points which he had made the previous day, and thanked them for the confirmation. How were the offset programme costs determined? Were there any guidelines, or who set the costs for the offset programmes, because Sasol and Eskom’s offset programme amounts were much higher -- R4.2 billion up to 2025?

Ms Herbst responded to the GroundWork presentation, saying that the information presented seemed to be different from the information that Eskom based its decisions on. She did not agree with the GroundWork presentation on the emissions’ impact on health. However, it needed to be looked at. Prof Cornelius’s presentation on the impact of air pollution on health was different from what Mr Euripidou had presented. Eskom needed to focus on the studies and ensure that they were making decisions based on the correct information.

Mr Van Niekerk interrupted by standing up and leaving the meeting with no appropriate procedures for excusing himself.

The Chairperson said that the manner in which Mr Van Niekerk had got up and waved goodbye and left the room was utterly unacceptable and disrespectful. He needed to submit an apology for his unorthodox manner of excusing of himself from the room, as protocols needed to be followed to show respect for fellow Members and delegates.

Ms Herbst apologised to the Chairperson on behalf of Mr Van Niekerk.

She continued with her response to the issues that were at hand, and said that in terms of the offsets, Eskom had submitted their plans one month late, but they were approved the first time. Regarding the issue raised by community members -- of government mandates that were executed by industries – she commented that doing something rather than nothing was the best approach, and all the programmes needed to be integrated to improve the lives of people. Both Eskom and Sasol believed it needed an integrated approach to implement offsets, to help benefit the community. Both industries needed to work in synchronisation with each other.

The Chairperson thanked all the stakeholders, Members, delegates and public viewers for their interest, and said that a meeting would be held once again early in 2018. He was sure that everyone found the meetings beneficial.

The meeting was adjourned.

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