Rob Jeffrey, Independent Economic Risk Consultant: It is claimed that wind and solar are the cheapest sources of electricity and these sources should dominate the future electricity supply. This paper focuses on known additional costs and subsidies which are not taken into account by their advocates. Advocates of wind and solar claim a cost of 62cents/kWh. This is, however, the price at the gate of the supplier. It does not include all the costs of supply necessary to convert this electricity from non-dispatchable electricity supply to dispatchable electricity supply at the point of supply to the customer. These are in effect direct subsidies to solar and wind suppliers, whereas they should be added as a cost to the renewable energy suppliers
Rob Jeffrey, Independent Economic Risk Consultant: The industrial base of a country depends on a reliable supply of electricity and steel. In the 1930s, South Africa developed both Eskom and Iscor. Since then the economy has diversified considerably. While the industrial and mining base of the country remains dependent on reliable supplies of these primary products, the manufacturing industries, the secondary and mining sectors also need to be developed through efficient labour and technical training. Business investment needs certainty about energy sources and future potential growth. As a developing economy, South Africa needs both to fulfil its key objectives. This paper is a brief review of the steps that are necessary for South Africa to return to a long-term economic growth path and achieve its primary objectives of reducing poverty, unemployment and inequity.
Rob Jeffrey, Independent Economic Risk Consultant: “Although nuclear energy has a high capital cost, it has a large load factor that is about 90%, compared with other energy sources that have a much lower load factor and life capacity.” South Africa’s National Development Plan (NDP) set the country’s gross domestic product (GDP) growth target at more than 5% a year for the country to meet its economic, social and political objectives. These objectives include the three fundamental targets of reducing inequality, poverty and unemployment.
Rob Jeffrey, Independent Economic Risk Consultant: Poverty is the single highest social cost to society. There are only three major policy objectives: a) poverty alleviation, b) reducing inequality and c) reducing unemployment. Emerging economies require electricity energy sources that offer security of supply at the lowest possible cost. Conclusion: Unless emerging countries that have fossil fuels use them it will heavily prejudice their future growth and result in increased unemployment and poverty. Renewables and carbon tax are contrary to objectives. They are both taxes on the poor.