Address by the Minister of Higher Education, Science and innovation, Dr Blade Nzimande on the occasion of the webinar on renewable Hydrogen and Green Powerfuel opportunities for South Africa - Tuesday, 09 February 2021
Dr Riina Kionka, the European Union Ambassador to South Africa;
Mr Tudor Constantinescu, Principal Adviser to the Director General for Energy at the European Commission;
Mr Chris Yelland, the Managing Director at EE Business Intelligence;
Mr Thomas Roos and Dr. Jarrad Wright, Representative of the CSIR Energy;
Ms Monica Swanson, International Business Manager: Hydrogen Projects;
Mr Marc Aartsen, International Programme Manager: Ports Projects, at the Port of Rotterdam;
Mr Peter Mackey, Vice Principal Strategy & Policy Support for the Hydrogen Energy Business Line at Air Liquide;
Dr Tobias Bischof-Niemz, Head of Division: New Energy Solutions, at Enertrag AG, Germany, and CEO of Enertrag South Africa;
Thiago Almeida, Sector Lead: Power and Infrastructure, at Nedbank CIB
My advisors and the Ministry Staff
Officials from the Department of Science and Innovation and the Department of Higher Education and Training;
Invited guests;
Ladies and gentlemen;
Members of the media
I am grateful to be joining you today in this webinar on renewable hydrogen and green powerfuel opportunities for South Africa.
This event provides us with an opportunity to also launch a detailed study on powerfuels and green hydrogen powerfuels and the opportunities arising for South Africa, commissioned by EU-SA Partners for Growth Programme.
The fact that this event takes place remotely due to COVID-19 does not in any way reduce our commitment to vigorously promote the development of renewable fuels as key energy sources in our society and our economy at large. What the coronavirus pandemic has taught us is to find new innovative ways to advance our socio-economic objectives.
The pandemic continues to cause severe damage to the global economy, affecting trade, investment, production, international travel and global supply and demand.
It is now known that no country or economy has been spared by the ravaging effects of this pandemic.
South Africa has been affected in distinctive ways by the new fourfold crises facing capitalism globally, which are:
- COVID-19;
- deepening economic crisis; locally and globally;
- the multiple crises of socio-economic sustainability for families, households and communities, and
- Climate Change.
This webinar also comes at a time when we are as a country also focusing on extraordinary measures of economic recovery and reconstruction to achieve inclusive growth following the devastation caused by COVID-19 to our people’s lives and our country’s economy.
This is a plan on which all of us as South Africans must work together to build a new economy.
The objectives of the plan are clear:
- To create jobs, primarily through aggressive infrastructure investment and mass employment programmes;
- To reindustrialise our economy, focusing on growing small businesses;
- To accelerate economic reforms to unlock investment and growth;
- To fight crime and corruption; and
- To improve the capability of the state.
All these objectives are linked to the vision of our country set out in the National Development Plan.
The depth of the crisis caused by the COVID-19 pandemic has sharpened our resolve to address our massive socio-economic challenges.
At the centre of our Reconstruction and Recovery Plan, is the creation of sustainable jobs. Our determination is to get our people back into the jobs they lost during the pandemic.
We are also determined to create more employment opportunities for those who were unemployed before the pandemic or who had given up looking for work.
This means unleashing the potential of our economy by, among others, implementing administrative reforms, removing regulatory barriers that increase costs and create inefficiencies in the economy, securing a stable energy supply, and freeing up digital infrastructure.
We therefore view this webinar on renewable energy and green powerfuel opportunities for South Africa amongst the critical and leading instruments towards our economic recovery.
There is growing scientific evidence suggesting that accelerated global warming, driven by increased release of CO2 into the atmosphere, deforestation, loss of biodiversity and forms of mass agriculture driving zoonotic risks may lead to the frequent emergence of future global pandemics. Future economic planning has to take the stabilization of the earth’s climate and retention of natural capital as central features of our growth strategies. Clearly, the shift away from carbon-intensive fossil fuels in favour of greener, renewable energy forms is crucial in this regard.
Alternative and renewable sources of energy, like solar and green hydrogen-based sources of energy, are precisely what we need to prevent the world and its life from being destroyed by pandemics in future.
The advantage of renewable hydrogen and green powerfuels must make it possible for us to provide cheap and sustainable sources of alternative and renewable energy to ordinary people, the workers and poor in our country including the rural areas.
Renewable energy must not only be accessible to the wealthy and better- off in society, it must be accessible to all. That is the reason I strongly believe that a public company such as Eskom must position itself to play a leading role in this space of the renewable hydrogen and green powerfuels.
Given the context of today’s occasion, I would therefore like to focus my address on how science, technology and innovation (STI) could play an important role in providing solutions to a sustainable and inclusive economic development.
In our innovation-led economic growth and development strategy, the key challenge is that of addressing what is sometimes referred to as the “Innovation Chasm”, which provides for the addressing and removing barriers that slows down and in some cases prevents the movement of ideas and inventions from the laboratory into the productive economy and society.
This is a challenge that South Africa has long identified and which our President, Mr Cyril Ramaphosa requires my department of Science and Innovation to address by focusing sharply on removing all barriers to enable South Africa to successfully overcome the ‘innovation chasm’.
In demonstrating this commitment, the President also brought together the Department of Higher Education and Training and the Department of Science and Innovation under one Ministry with the aim of closely aligning our skills development and innovation strategies much closer together in order to facilitate an innovation-led economic growth and development strategy.
It remains our intention to fully utilise this space and further strengthen our innovation led development.
Some of our new higher education, science and innovation landscape opportunities that can be exploited is the advancement of the renewable hydrogen and green powerfuel industry and the role that the Energy and Water SETA and the Wholesale and Retail SETA can play by launching a training programme to expand skills development initiatives to support other alternative sources of energy, such as the renewable hydrogen and green powerfuel training.
The entities in my two departments should exploit these opportunities, including of course involvement of our technical and vocational education training colleges (TVET) in such initiatives, which will add to the already existing training that is offered by some of our universities.
It seems also an ideal time for us empower our TVET colleges, in partnership with industry, to begin with training of green artisans and other mid-level skills in the value chain of the green economy we seek to develop. In this regards, I am proud that my Department, through the HySA programme in partnership with Bambili Energy, a woman-owned company, the University of Pretoria and the Water and Energy SETA have started to provide training to TVET and University of Technology graduates in the installation and maintenance of Hydgrogen Fuel cells. A first cohort of trainees graduated in December 2020.
On the further development of skills by academia, through the National Research Foundation (NRF), our country continues to develop skilled workers capable to generate new ideas and knowledge.
I am pleased to indicate that the significant portion of the NRF budget to date goes towards Human Capital Development initiatives.
The South African Research Chairs Initiative (SARCHi) and the Centres of Excellence initiative are invaluable research instruments to develop and promote new knowledge and skills in new fields.
It should be noted that this is a fraction of investments made by the Department of Higher Education and Training in skills development, and therefore in making use of the new Higher Education, Science and Innovation landscape a lot more pivotal.
Our Renewable Energy RDI Programmes are not just producing the next generation of scientists and engineers for the workforce but the next generation of business leaders and public sector managers and policy experts.
South Africa’s has a comparative advantage when it comes to renewable hydrogen and green power fuels.
We have a unique competitive advantage in the production of green powerfuels. The exceptional wind and solar natural resources, which together with abundant low-cost land, 50 years of experience in the commercial production of synthetic fuels using the Fischer-Tropsch process, and good shipping access to the rapidly growing international markets of the European Union and the Far East, including China and Japan, should position us as a key role player in renewable hydrogen and green powerfuels, both locally and internationally.
In December 2019, my Department of Science and Innovation (DSI) appointed an independent panel of experts to review the second phase of implementation of the Hydrogen South Africa (HySA) Programme.
At the end of the second phase of implementation over 1 billion Rands had been invested. At the early stage of the implementation of this programme we succeeded to attain outputs such as publications, Masters and PhD students and registered patents. The key challenge now is to turn this intellectual capital into developmental and commercial gains to fuel the next generation companies to drive the energy economy of the future.
According to the second HySA Five Year Review, there is a lack of an overarching policy on a South African hydrogen economy. This is a threat to the successful implementation of the HySA programme especially given that the uptake of commercial products into the domestic market is critical.
South Africa is one of the pioneers in terms of developing a hydrogen strategy which we launched in 2007. From January 2019 to December 2020, 18 more countries released their national hydrogen strategies linking the growth of a hydrogen economy towards supporting a green and circular economy to speed up economic recovery post COVID-19.
In our country, this strategy is led by the my Department of Science and Innovation amongst others to ensure maximum return on investment into HySA.
As a country, building on the strategy, we developed a South African Hydrogen Roadmap to set out a vision for an inclusive hydrogen society so that an enabling compact between industry, labour, community and government can be developed.
This Hydrogen Society Roadmap will assist and enable our government and industrial stakeholders to put in place a policy framework required to promote the exploitation of the benefits that hydrogen provides through its integration into the various sectors of the economy.
It is our aim to position this policy framework to leverage on the existing relevant government policy documents as well as identify gaps within the regulatory regime that needs to be addressed to enable the widespread use of hydrogen as an energy source in the economy and society.
In addition, this framework will leverage on the successes achieved through the HySA RDI Programme to transition the R&D and demonstration phase into the commercial phase, and ultimately lead to the achievement of economic and social benefits for the country.
Through the DSI, we commenced stakeholder engagement process in June 2020 with over 50 stakeholders across the private sector, government and parastatals.
At the end of November 2020, the project team completed the first draft of the Hydrogen Society Roadmap. We are now hard at work to ensure that we integrate issue of Gender Equity and Social Inclusion (GESI) in this process. It is our considered view that this process should form a major part of the contribution of our sector to the Economic Reconstruction and Recovery Plan targeting hydrogen and the fuel cell sector.
Ladies and gentlemen, South Africa also participates in international partnerships that supports science diplomacy in renewable hydrogen and green powerfuels.
As a country we will put in place strategic international partnerships especially with countries looking to import and trade in the global hydrogen value chain. We will also ensure that our local universities and private sector are given an opportunity to play a pivotal part in the green hydrogen economy.
Our research, development and innovation will be critical to ensure that the cost of electrolyser technology is reduced and that green hydrogen and power fuels production is scaled up in order to bring the price of the commodity at parity with grey hydrogen.
As part of our commitments made under the White Paper on Science, Technology and Innovation, as a Department of Science and Innovation (DSI) we aim to attract foreign investment into South African with a target to secure at least 15% of South Africa’s Gross Expenditure on Research and Development from international sources with a long term goal to grow the ratio over time.
As a department, we made available R 1.2 billion worth of funding proposals in the 2020/21 financial year (FY) to international funding calls in areas relevant to enabling South African academia and private sector participation in the global hydrogen economy. Through this process, we received a total of five proposals ranging from smaller to larger funding amounts. These proposals includes the following:
- European Union (EU) Green Deal Funding Call – Hydrogen Corridor Consortium;
- The European Union (EU) Green Deal Funding Call – Carbon Capture and Use Consortium;
- The CLIENT II – Carbon Capture and Use Consortium;
- The SATREPS – Green Ammonia Consortium;
- French-South Africa Bilateral on Hydrogen; and
- The African Union (AU) and European Union (EU) Long-Term Joint EU-AU Research and Innovation Partnership on Renewable Energy (LEAP-RE).
The officials from my department will provide details on these proposals should more information be required.
However, I would like to make a reflection on the official launch of the detailed study on green powerfuels and the opportunities arising for South Africa, commissioned by EU-SA Partners for Growth Programme.
The EU-SA Partners for Growth Programme supports the EU Delegation (EUD) in South Africa (SA) in its efforts to maximise bilateral trade and investment flows between the EU and SA.
Powerfuels are synthetic gaseous or liquid fuels based on renewable hydrogen, which is hydrogen (H2) obtained by the electrolysis of water using renewable electricity. Powerfuels comprise pure hydrogen, hydrocarbons and ammonia.
Some Powerfuels are hydrocarbons, in which case the carbon required for their production must be obtained from captured CO2.
While the EU Hydrogen Strategy does not currently place conditions on the CO2 used, in future the feedstock and process will be relevant when greenhouse gas emissions thresholds will be set.
A technical workshop on Powerfuels was held in December 2019 in South Africa, hosted by the EU-SA Partnership together with WITS Business School. The aims of the workshop were to explore the potential of a Powerfuels economy in South Africa, and to identify hurdles that could hinder the establishment of South Africa as a major supplier to Europe and other bulk markets.
Following from the successful workshop, the EU-SA Partnership will be hosting a study tour to Europe to demonstrate to the participants Powerfuels expertise and know-how.
Selected South African companies and relevant government policy makers will be invited to visit industrial plants, market leaders and EU officials in order to strengthen their understanding of the potential and benefits of Powerfuels. In this regard, a Research Paper was commissioned by the EU-SA Partnership to prepare for this Powerfuels study tour.
I would like to take this opportunity to thank the EU-SA partnership and the WITS business school for this ground-breaking initiative. I also wish to take opportunity to thank and congratulate all the individuals and companies that will be involved in this study tour well.
As I conclude, I want to indicate that COVID-19 is likely to stay for the foreseeable future. For this reason, we should stay alert and keep our planning within the sector to accommodate the unavoidable changes brought by this pandemic.
Thank you very much for taking your time attending to webinar. I wish all a fruitful and progressive engagements throughout this session.
Let us keep on keeping safe.
