Page 99 - Risk Report 2024

7. Energy 8. Logistics

Total grid failure (if it occurs) would considerably impact The interactive impact of the coal mining industry on
individuals and companies, and crime is likely to increase – electricity supply in SA is often underestimated. Coal power
particularly when solar or back-up systems run out. Insufficient stations utilise considerable coal volumes, and inadequate
understanding of energy supply and production and incorrect, Government policy on the export and pricing of coal has
inadequate, and even deliberate misinformation lead to resulted in poor quality of coal being supplied to meet power
incorrect risk identification and business continuity planning. stations design. Eskom and mining firms have progressed in
One big uncertainty is whether the transmission grid can managing wet coal related risks however, the controls cannot
be upgraded and strengthened to allow the connection of be fully effective. Coal transportation by road and failure of
new plant, in particular renewables. Loadshedding is having Government to manage the shift from road to rail, significantly
significant impact with 2023 having the highest number of days impacts the cost of coal, safety, and security, and creates a
of loadshedding since it started in 2008. Policy interventions lucrative market for criminal syndicates. The considerable
to allow private power generation have enabled some market increase in road transportation of coal, gas and other energy
resilience. related substances has severely impacted roads and the safety
of smaller vehicle users and local communities. Changes in
technologies in the energy sector are causing value and supply
chains to adjust. Ports are needed to facilitate increased
imports of renewable energy components, or exports of
green hydrogen or related products such as green ammonia.
Operations require water and should gas use increase, more
pipelines, with skills and reskilling for a just energy transition.

9. Food Security 10. Climate Change
Increasing cost of energy for production and storage remains Extreme weather impacts power infrastructure, generally
a significant input cost for businesses which is passed on to causing short-term power failures. Future planning of
the consumer; many have already made alternative energy transmission, distribution, and pipeline placement and
support arrangements. Food production can be impacted protection to address this, will be extremely costly. However,
by the competition for water and energy, as these resources if not done, this will have medium- to long-term impacts on
are critical components for agriculture and agri-processing supply of key basic services (such as the water challenges in
e.g. water pumping, processing of food and cooking etc. KZN). Balancing energy production, water use, and emissions
This energy-water-food nexus is impacted by changes to the remains a significant long-term challenge. Decarbonisation
climate. Food security is also exacerbated by geopolitical and extreme weather are key uncertainties but are becoming
tensions. more certain as global and national policies develop and
mature. For SA’s carbon intensive economy it is a risk for trade
and cost of production as measures such as the carbon tax
are rolled out. Changing weather patterns not only impact on
operations and plant reliability but also on customer energy
needs and location. A just transition away from fossil fuels
will lead to declining jobs in some sectors, necessitating novel
policy approaches and interventions.

11. Technology 12. Skills

Too much information, biased and negative reporting, and a lack of The energy sector has skilled personnel available, but many
interest from many individuals has led to an unbalanced population are in posts that they either are unable to shine, or they fail to
relying on headline comments and advice from many purporting perform, this leads to a request for more resources whereas
to be experts. Where any new technology allows for increased repositioning and retraining might be a better option. Challenges
incorrect and fake information, it remains critical to support those around political and family related appointments remain a key
who do not have the learning or ability to decide for themselves.
Cybersecurity is a critical issue for electrical infrastructure that area of concern. The changes in technology occurring due to
requires constant vigilance. New and emerging technologies such the energy transition necessitate the development of some
as AI, robotics, automation, and biotechnology are impacting new skills and upskilling and retraining as well as addressing
energy operations, use, and generation and require new skills and job losses. To ensure that we have the right skills at the right
knowledge to manage. Smart grid technology to integrate battery time and in the right volume will require a coherent vision for
storage, wind turbines, and other energy sources into the national the energy sector that is integrated into the skills system. The
grid offer opportunities to reduce outages. JET IP starts to give some recommendations on how this can
be achieved in a coordinated and integrated manner.