The evolving role of finance in South Africa’s renewable energy sector

By Lucy Baker. 2015

137 citations recorded by the source corpus.

In the last four years, carbon-intensive, coal-dependent South Africa has become one of the leading global destinations for renewable energy investment. This investment can be attributed to the unprecedented take off of the country’s Renewable Energy Independent Power Producers’ Programme (RE IPPPP), a bidding process for the procurement of privately generated, utility scale renewable energy, launched in August 2011. Asserting that energy must be studied within the broader economic, political and social forces in which it is embedded, I explore the fundamental role that different modes of finance have played in shaping South Africa’s emerging renewable energy sector within the context of the country’s unique system of accumulation characterised by its minerals-energy complex (MEC) (Fine and Rustomjee, 1996). I focus on finance and financialisation as growing features within the MEC. I further examine the tension or incompatibility between commercial demands for ‘bankability’, short-term shareholder value and impatient finance and RE IPPPP’s unique requirements for community ownership of projects and the realisation of economic development criteria. I find that a reconfiguration of long-standing MEC actors, particularly in the realms of finance is taking place as they merge with new sources of foreign capital.

Subfields: Building and Construction, Finance, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/b739848b10bb366a83f20ca582365b9876eb0523

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Citations in the corpus

Development geography II (2018, background): “Now, a small but growing number of scholars of international development and the Global South are explicitly concerned with deepening financialization (e.g. Hudson, 2008, 2015; Carroll and Jarvis, 2014; Baker, 2015; Jakupec and Kelly, 2015; Soederberg, 2013, 2015; Bracking, 2016).”
The political economy of energy transitions in Mozambique and South Africa: The role of the Rising Powers (2016, background): “Thus there are parallel and competing pathways being pursued both in terms of technology and the nature of how this technology should be procured – whether via the state utility Eskom or independent power producers (Baker 2015).”
The political economy of technological capabilities and global production networks in South Africa’s wind and solar photovoltaic (PV) industries (2017, unknown): “…long-term effectiveness, including the extent to which they may help to generate long-term employment and a local manufacturing industry and the increasing ownership of the renewable energy industry by large international companies (Baker, 2015) as the following sections discuss in more depth.”
“Breakthroughs” for a green economy? Financialization and clean energy transition (2018, background): “…(and clean energy transition as a central project of that development), financialization, and, crucially, the deepening articulations between these contemporary processes (Georgeson et al. 2014, Baker 2015, Bracking 2015, Castree and Christophers 2015, Knuth 2016, 2017, Kennedy 2018, Langley 2018).”
New frontiers and conceptual frameworks for energy justice (2017, background): “Programme (REIPPPP) was initiated in 2011, and its economic development criteria required that local communities participate in renewable energy projects (Baker 2015).”
Developmental States and Sustainability Transitions: Prospects of a Just Transition in South Africa (2016, background): “However, that said, since 2006 South Africa has adopted a slew of environmental policies, and niche innovations have driven a fast-growing RE sector with an investment portfolio equal to nearly 5% of GDP over just a few years.”
Fossilised Capital: Price and Profit in the Energy Transition (2021, background): “The example of South Africa, as related by Lucy Baker (2015), is something of a case study in the nature of this investment cycle.”