Address by Naledi Pandor MP, Minister of Science and Technology, at the Global Cleantech Innovation Programme for SMEs in South Africa gala dinner awards, CSIR Convention Centre, Pretoria
Mr Barlow Manilal, the Chief Executive Officer of the Technology Innovation Agency (TIA)
Mr Gerswynn Mckuur, the National Project Manager Global Cleantech Innovation Programme for SMEs in South Africa
In 2010, the government economics cluster agreed that South Africa should develop a green economy strategy. Soon after we held a green economy summit conference that drew together experts from several departments. The integrated character of ‘green’ activities required inter-departmental collaboration. The long-term greening of the economy required new thinking to tackle deep-seated production and consumption issues.
In turn green thinking influenced the updated Integrated Resource Plan, released in 2013, with its strong focus on renewable energy, with allocations for additional photovoltaic, wind and concentrated solar power capacity; a possible delay in the nuclear decision until after 2025 or even 2035, by exploring alternative options, such as regional hydro and further exploration of the shale gas potential; and an allocation for a new set of fluidised-bed combustion coal generation.
The National Development Plan (NDP) has a similar focus, identifying innovation and technology for cleaner coal use as key drivers for achieving a greener energy dispensation by 2030.
Greening the economy also reached the Technology Innovation Agency that has in the past few years been effectively repositioned as an agency whose funding instruments will enable innovators, entrepreneurs and small and medium enterprises to commercialise their technology innovations.
Technology innovation is inherently high-risk and therefore requires a clearly defined and structured approach. To achieve this, three funds are provided for in the new TIA strategy:
- Seed Fund, which is aimed at assisting universities, in particular, in bridging financing requirements to translate research outputs into fundable ideas for commercialisation;
- Technology Development Fund, which is available to organisations, individual entrepreneurs and SMEs to advance technologies along the innovation value chain; and
- Commercialisation Support Fund, which prepares innovators for follow-on funding.
Since 2010 TIA has supported more than 8,130 small and medium enterprises in accelerating technical innovation through technology development. The impact of the support to SMEs has resulted in significant improvement in technical skills, product quality, productivity, cost-savings, energy efficiency, waste management and most important of all employment creation.
A country enhances its prosperity through investment in higher- level skills and advanced technology - new ideas, new opportunities, new jobs.
Investment in advanced clean technology is a complex process. The shift from research to proof of concept to ultimate commercialisation requires close cooperation and harmonisation of the work of several departments, particularly the Department of Trade and Industry, the Department of Economic Development and the Department of Science and Technology.
What clean technologies are being developed in South Africa?
The Department of Science and Technology asked Academy of Science of South Africa (ASSAF) to document green technologies currently in use in South Africa, and in so doing to answer some key questions.
The first questions was: what green technologies are in use? The answer is that we use green tech in energy, water, waste and sanitation, and in industry, mining, agriculture, ICT, health, transport and buildings. But we use green tech primarily in the renewable energy sector. South Africa is one of the most carbon-intensive economies in the world, and so it is no surprise that we are committed to using green tech wherever possible and to becoming a green tech leader in Africa. Yet the bottom-line answer to the first question is that South Africa has been slow to develop and adopt green technologies.
The second question was: where is the potential for the future growth of green tech? The answer is renewable energy. It is barely a decade ago that the received wisdom was that renewables were too expensive to form part of a national energy grid. Much has changed. Specifically the cost of almost all renewable energy components has declined substantially.
As the cost of renewable energy has been declining, so too has the price of oil. In fact, the price of oil has halved over the last six months putting many renewable energy projects on a hold. There are many reasons for this oil-price decline but the most significant has been a disruptive innovation in drilling technology. I'm talking about horizontal drilling or fracking that allows oil companies to release oil and gas from previously untouchable shale. Before this technology you couldn't get oil or gas out of these shale formations. It was simply too expensive. Now the U.S has been able to increase its own oil output and so it doesn't need to import as much oil from the Middle East - with huge geo-political consequences.
The third question was: are there opportunities for new innovative green technologies? The answer is that there are five emerging technologies: grid-scale storage; digital-power conversion; compressor-less air conditioning and electro- chromic windows; clean coal, specifically carbon capture and storage; bio fuels and electro fuels.
The fourth and last question was: what policies would promote efficient and sustainable green technologies in South Africa? The answer is that we already have a favourable policy environment. We have a number of overarching and sector- based policies that cover green technologies - the Department of Science and Technology 10-Year Innovation Plan; the Department of Energy Integrated Resource Plan; the National Development Plan; and the National Energy Act (Act 34 of 2008). The challenge is rather one of policy certainty and policy alignment.
It is in this policy context that TIA has partnered with United Nations Industrial Development Organisation and the Global Environment facility to implement the “Global Cleantech Innovation Programme for SMEs in South Africa”. This is the second year of a renewed initiative that was first showcased at the United Nations Climate Change Conference (COP 17) held in Durban in 2011. At that time the National Cleaner Production Centre of South Africa, hosted at the CSIR on behalf of the DTI for the last fifteen years, were custodians of this programme, and they remain vital partners in the implementation of the initiative.
In passing, it's worth noting that the National Cleaner Production Centre of South Africa revealed last year that SA’s fledgling renewable energy sector contributed R5.6bn worth of benefits to the country last year. The study found that electricity generated by wind and solar power had saved R3.7bn that would otherwise have been spent on diesel and coal. There was a second saving of R1.6bn from what the researchers call ‘unserved energy’ – the saving to the economy of avoiding power cuts to some consumers. At certain times, wind and solar-generated electricity increased generating capacity on the grid and so avoided a certain amount of load shedding.
Through its various activities and continual engagements with stakeholders, the Global Cleantech Innovation Programme contributes to the development, promotion and deployment of clean technology innovations. It also creates a highly visible platform for linking South African entrepreneurs with investors, business and commercial partners, potentially resulting in the commercialisation of new products and services and ultimately job creation.
As a legacy project, the national initiative aims to find and foster small and medium-size enterprises with innovative technology solutions that can tackle the most pressing energy, environmental and economic challenges in South Africa. The Programme is intended to support SMEs in particular to promote clean technology innovation and supporting SMEs and start-ups that are working on solutions related to energy efficiency, renewable energy, waste beneficiation and water efficiency.
In the WWF Global Cleantech Innovation Index 2014, South Africa is ranked 29 out of 40 countries surveyed. The index indicates which countries are at the leading edge of innovation and also measures the various inputs and outputs of innovation in the sector. To strengthen the sector in South Africa, the Global Cleantech Innovation Programme works to build relationships with government, industry, investors, academia and incubators.
The Programme aims to spur South African innovations in energy efficiency, renewable energy, waste beneficiation and water efficiency; and maximising every participant’s chances of being successful in the Programme and increasing their probability of achieving sustainable commercial success.
The Programme combines a competition and a business accelerator to offer participants progressing through the Programme extensive mentoring, training, access to investors and opportunities to showcase their innovations to the media and the public. Participants and winners in SA, and from international partner countries, stand a chance to win a cash award and a trip to Silicon Valley in November 2015 to participate in the Cleantech Open Global Forum where they will be able to connect with potential partners, customers and investors from around the world.
This year, one hundred and twenty applications were received from all provinces of South Africa. Twenty eight semi-finalists emerged from the first round judging, where renewable energy innovations form the highest proportion (54%) and the waste beneficiation category (25%) is also well represented. The technologies ranged from solar heating designs to mechanical energy storage systems and vermi-composting.
This process has showcased an innovative nation. Innovation adds momentum to the structural economic change that is needed for economic growth, job creation and an improved quality of life for us all.
