Image: Hydrogen CRC
As global stakeholders shift attention towards environmentally cleaner sources of fuel, hydrogen has emerged as an ideal transitionary resource. Offering significant opportunities to increase energy security and supply, while reducing carbon emissions, countries rich in renewable resources such as South Africa could significantly benefit from an established hydrogen economy.
Increase Energy Security and Supply
South Africa currently relies on electricity and fuel imports from neighboring countries to sustain its growing economy. Despite the gradual uptake of renewable energy developments across the country, owing to the implementation of the Renewable Energy Power Producer Procurement Program, the country’s demand continues to significantly outweigh supply. By harnessing its significant renewable energy potential through green hydrogen developments, South Africa could benefit from enhanced energy security and a stable, consistent supply, thus reducing imports and driving economic growth.
Drive the Transition to Cleaner Sources of Fuel
The establishment of South Africa’s hydrogen economy could fast-track Africa’s energy transition through the shift to renewables and the reduction of greenhouse gas emissions. Currently, South Africa is the top carbon emitter in Africa, and therefore the need to accelerate the transition to cleaner energy sources is particularly pressing. Utilizing green hydrogen in South Africa could position the country as a leader in the energy transition, serving as a model for other resource rich countries and ensuring climate change is adequately addressed.
Meanwhile, South Africa is well-endowed with platinum group metals – essential for producing green hydrogen. With more than 80% of the world’s platinum reserves, the country is well positioned to drive the development of a green hydrogen economy, accelerating renewable energy utilization and the energy transition.
Position South Africa as an Energy Exporter
As a net importer of oil and gas, South Africa serves to significantly benefit from the development of a hydrogen economy. Hydrogen could not only reduce imports across the country and ensure sufficient supply for its domestic economy, but enable the export of energy to the wider region. With many people across southern Africa still lacking access to energy, the regional community could benefit from a sustainable hydrogen supply from South Africa. What’s more, South Africa, in addition to energy security, stands to benefit from increased foreign trade associated with exports.
Drive Socio-Economic Growth
South Africa boasts the second largest economy in Africa, second only to Nigeria. However, the country continues to experience slow economic growth, hampered by inadequate energy supply, as well as critical unemployment levels – estimated at 34.4% in Q2 of 2021. By redirecting investment towards hydrogen solutions, South Africa could significantly increase job creation, enhance country wide industrialization, and effectively spur socio-economic growth for years to come. With the COVID-19 pandemic hindering economic growth, hydrogen could be the solution to getting the country back to pre-pandemic growth levels.
Alleviate Energy Poverty
Finally, notwithstanding the economic benefits that a hydrogen economy will bring to South Africa, capitalizing on the resource could enable the alleviation of energy poverty, both in the country and across the wider region. With the continent pursuing energy poverty alleviation in line with United Nation’s Sustainable Development Goal 7 – stating that access to reliable, sustainable, and affordable clean energy for all is important for national development – South Africa could realize this objective through hydrogen. Energy poverty does not only reflect lack of access – representing approximately 34% of people in South Africa – but also the lack of affordable energy. Accordingly, by enhancing hydrogen development, South Africa could not only meet energy demand, but create a competitive, cost-efficient energy sector for years to come.
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