South Africa needs to urgently transform its energy system, with research on South Africa’s energy sector indicating that the long-term cost of inaction is high.

As the world’s most carbon-intensive economy among the G20 countries, almost 50% of the country’s exports are at risk as key trade partners prioritise imports from low-carbon economies instead.

Combined with a stalled GDP growth, an unemployment crisis, rising inequality, and the increasing severity of climate impacts, a just transition to a net-zero economy by 2050 is imperative. Decarbonising South Africa’s electricity system, through ramping up renewable energy deployment is the catalyst for driving that change.

This is according to the National Business Initiative (NBI), Business Unity South Africa (BUSA), and the Boston Consulting Group (BCG) Climate Pathways and Just Transition study, which assesses what it would take for South Africa to reach net-zero by 2050 and to ensure a just transition.

Over the past two years, the NBI, BUSA and BCG, have explored pathways to achieve a net-zero economy within a fair share carbon budget, and to lift South Africa’s people out of poverty, inequality, and unemployment.

The study is one of the most robust, transparent, and inclusive climate studies in South Africa, and is championed by a cross-sector group of 30+ CEOs. The research was conducted in consultation with more than four hundred stakeholders from across business, government, civil society, and labour through over two hundred hours of technical workshops and one-on-one engagements.


It all hinges on renewables

BCG’s integrated energy report launched on 21 July 2022 detailing South Africa’s just transition lays out the core findings regarding the transformation South Africa needs to pursue in terms of our energy sector and draws upon the series of six innovative research reports released in 2021.

The report finds that South Africa can solve its current energy crisis and realise a just transition to a competitive, net-zero economy, if it can unlock its globally advantaged, high-potential wind and solar energy resources at scale and at an unprecedented pace.

This energy transition would improve the availability and reliability of South Africa’s power supply – all while enabling new green industries to build the foundation of a globally competitive economy that is resilient to trade risks from a transition to net-zero.

The report further highlights:

  • The urgent need to drive decarbonisation and transformation of the energy sector in South Africa immediately.
  • * The need for renewables to be elevated as a national priority going forward.
  • The need for a coordinated approach to incubate new green industries, drive economic diversification and create opportunities for skills development, job creation and improved livelihoods in order to build an inclusive future economy

The Climate Pathways study is an ongoing project, several detailed analytical and model-based sector-level reports have been released.