World Bank & Eskom Spark Controversy

Written by: Jessica Solomons

With the ongoing focus on the climate change crisis by the global media and governments worldwide, it’s no surprise that the World Bank’s recent decision to help finance another coal-fired power plant in South Africa has been met with international disapproval.

According to Obiageli K Ezekwesili, the World Bank vice-president for Africa, the building of Medupi power plant, which will be run by Eskom, will help solve South Africa’s power shortage problems and improve living standards in the poorer communities, providing not only employment opportunities but also much needed access to electricity. The US, UK, Netherlands and Italy, however, showed their opposition to the decision by abstaining from voting for or against the $3.75 billion loan, which they argue is incompatible with the World Bank’s commitment to promote low carbon economic development. But for many campaigners, the United States government, as one of the biggest lenders to the World Bank, should be doing more to block the loan especially given the Obama administration’s proposed commitment to shift aid to developing countries away from coal and fossil fuels to less energy polluting sources.

Despite various complaints, criticisms and campaigns, however, the building of the Medupi plant is set to go ahead in February 2012. So what does this mean for the environment and South Africa?

While Eskom has proposed to use the latest in “clean coal” and carbon storage technology which will potentially release 10%-15% less carbon dioxide than conventional coal-fired plants, the fact remains that the establishment of Medupi will still impact the climate and the surrounding area. Despite promises of Medupi providing more work for the poor and alleviating the power shortage problems that have been plaguing SA since 2008, experts in the field argue that the development of the plant is more of a threat than a blessing.

Bobby Peek of the South African environmental justice and development organization, groundWork, voiced his concern that many of the rivers in the Limpopo area, where the plant will be located, will be contaminated by mercury and various other toxins and that this contamination will extend into the air with damaging sulphur and carbon dioxide emissions. And with 25 million tonnes of pollution said to be released into the atmosphere yearly as a result of the Medupi Coal Plant – a figure which is equal to half the total greenhouse emissions of Norway – residents in the Limpopo region have jumped on the campaign bandwagon and lodged complaints themselves with the World Bank inspection panel voicing their concerns, but their pleas seem to be falling on deaf ears.

Energy Minister, Dipuo Peters, insists that citizens should support the loan because 25% of South Africans are still without access to basic, minimum electricity. But many people, especially those in the immediate area of the Medupi site, ask; should we have to choose between our health and electricity?  

Environmental and community activists are concerned that South Africa’s growing fossil fueled economy, if not addressed, will begin to impact the rest of the African continent. Statistics show that South Africa is in fact responsible for 40% of the greenhouse gas emissions in the African continent – a startling figure when reminded that only 6% of Africa’s population lives in SA. What this means is that our government’s decisions when it comes to building more coal-fired power plants impact neighbouring countries, altering their climate and ultimately pushing us further into climate debt with the continent.

But our climate debt is not the only concern. Despite promises that the Medupi Coal Plant will create more affordable electricity for South Africans, Eskom needs to pay back the billions it has borrowed and reports are circulating that to do so the company intends to increase electricity rates which has led critics to ask; how is this project really helping the poor? These revelations have only strengthened concerns that the only people benefiting from this loan are those in government and industry. In fact, the leading party, the ANC, is set to reap huge profits given their share in the company manufacturing turbines for the plant.

Local and international campaigners believe that Eskom’s assurances that the Medupi Coal Plant will strengthen the country’s economy and eventually take South Africa into a greener future are nothing but empty promises, and argue that Medupi will only serve the needs of those in power at the sacrifice of the poor and the planet.

The liveeco team  

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