South Africa has the strongest economy in the whole of the African continent and is a development hub for the entire southern region. However, among other difficulties, it has excessive unemployment and is one of the countries with most inequality in the world.
Both positive and negative data explain, in part, the country’s focus on renewable hydrogen – a technology that will be key in the coming years. Among the benefits it can bring to the country are job creation, industrial reconversion, emissions reduction, strengthening the energy market and moving towards a more inclusive, robust and sustainable economy.
South Africa’s economic strength, which places it among the so-called BRICS (the five emerging economies), gives it a competitive advantage in developing its own hydrogen economy. Mainly because this requirement involves a diverse market, a skilled workforce and increasing technological development.
It is also a global mining power, a fact that has historically earned it a position among the world’s leading economies. It is the world’s largest producer of platinum – a key raw material for the production of green hydrogen (it is used as a catalyst in the electrolysis process). But it is also a producer of other raw materials, such as chromium and manganese, and is one of the leading producers of gold, iron, cobalt and diamonds, for example.
The mere fact of having a strong mining sector, with influential and economically powerful players, can provide a strong impetus for green hydrogen for a number of reasons, among them:
South Africa is also one of the world’s leading producers of wind and solar energy. So its position in the renewable energy market is also a plus for the deployment of green hydrogen. In fact, the country is located in an area of excellent irradiation and is part of the Gigawatt Club (countries with a renewable energy production of more than 1GW).
All these conditions are the starting point for the impulse that is being given by the Public Administration in collaboration with private entities, whose main projects are already taking their first steps.
At the COP26 the South African government announced the creation of a green grid as well as a Special Hydrogen Economic Zone in the Northern Cape province.
At the COP26 the South African government announced the creation of a green grid as well as a Special Hydrogen Economic Zone in the Northern Cape province
The strategy aims to position the Northern Cape as a leading region for the production and export of green hydrogen, developing an ecosystem and infrastructure that will enable 5 GW of electrolysis capacity and 10 GW of renewable energy generation by 2026. This project aims to complete a research and development phase before moving on to production and commercialisation.
In addition, a Hydrogen Valley is planned in the Limpopo region in an area where platinum group metals are mined. This is a major initiative, as it forms part of a national initiative within the Economic Reconstruction and Recovery Plan to build a sustainable, resilient and inclusive economy.
Exploiting synergies between platinum mines, renewable energies and hydrogen production is one of its strengths. Thus, it aims to produce hydrogen on an industrial scale, creating a cluster to promote various uses of green hydrogen and to boost R&D&I.
It aims to produce hydrogen on an industrial scale, creating a cluster to promote various uses of green hydrogen and to boost R&D&I
Another major project planned by the South African government is the hydrogen corridor between KwaZulu-Natal and Limpopo, where a hydrogen bus route will link major cities such as Pretoria, Johannesburg and Durban.
Between the two regions to be linked by the South African hydrogen corridor is the town of Secunda. The city is famous for the Sasol petrochemical plant, which is the most polluting petrochemical plant in the world. In fact, it produces more emissions than countries such as Norway or Portugal, but it soon wants to stop doing so and will focus on green hydrogen production and reducing its emissions as part of its net zero strategy for 2050. It is just one more sign of the country’s potential to create a leading hydrogen economy.
South Africa is one of the founding countries of the African Green Hydrogen Alliance. It has joined up with Kenya, Namibia, Egypt, Morocco and Mauritania to strengthen collaboration and create a hydrogen economy in their regions.
The Alliance aims to promote public policies that, among other things, improve project financing so that projects can take advantage of the high demand expected in the coming years.
Can South Africa make a just and sustainable socio-economic transition with green hydrogen? It remains to be seen, but the conditions in the country are indeed positive for achieving such an important goal.