Terra Firma Academy interviewed Ken Ross, an Engineer from Terra Firma Solutions specialising in energy efficiency.
Terra Firma Academy: Ken, firstly we have heard a great deal in the press about Eskom and the significant electricity price increases planned in the next 5 years. Can you tell us what you expect from Eskom over the next 5 years?
Ken Ross: Eskom have had a 16% tariff increase approved for this financial year by the energy regulator and have further submitted for a multiyear price increase structure to the regulator. The rumour is a 15% per year increase although I expect this to be higher as the cost of coal increases and the requirement for additional generating demand increases.
Terra Firma Academy: It sounds like we have significant issues that need to be resolved in the electricity space in South Africa. Do we have the energy experts in this country to become more efficient at a residential and company level?
Ken Ross: The concept of energy efficiency on a broad scale is relatively new globally due to the historically low cost of energy that we derive from fossil fuels. This is particularly true in South Africa where our history of very cheap electricity and abundance of fossil fuels have led to a culture of inefficient energy use. Often engineers in are tasked with ensuring uptime and reducing maintenance costs and saving energy takes a back seat in many energy intensive environments. This has led to a huge skills shortage and very few technical experts in energy efficiency and energy management in South Africa.
Terra Firma Academy: Seems like there are enormous job opportunities in this space what types of skills do you envisage we need?
Ken Ross: The skills are multidisciplinary in terms of reducing energy consumption in the residential, commercial, agricultural, manufacturing and mining sectors in South Africa. The skills range from energy audits and assessments, data and financial analysis, energy management skills, engineering design skills, measurement and verification as well as installation and commissioning of new technologies. The sector presents jobs opportunities across all skill levels, from electricians and artisans right through to engineers and financial experts.
Terra Firma Academy: What about water? We hear rumours that South Africa will have serious water shortages in the next few years. Do we have water experts that can help us reduce, reuse and recycle water in SA?
Ken Ross: Water scarcity is one of the scariest challenges our generation will face. Whilst a significant emphasis is currently being put on energy shortage due to the immediate constraints on economic growth and future greenhouse gas emissions, the next big crisis will be water. Water is essential, not only to human life, but to all our economic sectors, especially the agricultural and manufacturing sectors. Water is also critical to electricity generation in almost all of our power plants. Water efficiency skills are in very short supply in South Africa and even the basics around water management, cleaner production and water recycling are only understood and implemented by a handful of people. I see this as one of the critical areas that should be focussed on for skills development in South Africa.
Terra Firma Academy: We have heard that there is a carbon tax imminent in 2013/14? Can you tell us a little more about this tax?
Ken Ross: The imminent carbon tax will be on a company’s direct emissions that occur in their company owned assets, such as boilers, furnaces and vehicles. These emissions are from the direct usage of fuels such as petrol, diesel, coal and fuel oils as well as refrigerant gasses. These emissions are termed scope 1 emissions. Currently the proposed carbon tax legislation gives companies a 60% tax free threshold on their scope 1 emissions, thereafter they will be taxed at a rate of R120 per tonne of carbon dioxide equivalent emitted. In certain instances companies will be given an additional tax allowance depending on their industry as well as their efficiency when compared to similar companies. To give an example of carbon tax, a company with direct emissions of 100,000 tonnes of CO2, will be taxed on 40,000 tonnes at R120 per tonne. This equates to an annual tax liability of R4.8 million and this is not a large carbon footprint at all.
Terra Firma Academy: Surely this will create large scale job growth as who will help companies calculate their emissions?
Ken Ross: Companies will need to take proactive steps to measure and reduce their carbon emissions. This will require experts in many different fields that will need to be able to assist companies in calculating their carbon emissions, putting in measures to improve reporting accuracy and develop carbon management plans. This will fuel the green jobs industry as experts with skills in energy, water and waste management will be needed as well as carbon experts who can implement measurement and management programs and identify areas of improved efficiency around logistics, travel and processing.
Terra Firma Academy: Do you see a large demand for these jobs currently?
Ken Ross: I see an exponential increase in demand for these skills throughout Southern Africa as companies are realising that environmental efficiency makes good business sense by reducing costs and managing risks. Many companies want to have these skills in house, but are currently forced to outsource them as a result of the large skills shortage globally in these skills.
Terra Firma Academy: Ken, if you had a teenager, what courses would you recommend they do to get a better idea of a career in the green field?
Ken Ross: I would encourage my children to get a full understanding of the green industries by introducing them to energy, water and waste efficiency courses that are aimed at a sensitisation and introductory level. It is critical that all generations understand these issues and take part in being the solution. This is the largest battle the mankind has faced thus far as we are fighting towards keeping life, as all humans globally know it, the same and not having significant changes in our lives as a result of changing weather patterns, increased storms and increased disease. The real rubber hits the road in implementing and understands environmental efficiency and that would be my recommendation.