Budget 2025: Understanding South Africa’s energy landscape

South Africa's energy future hangs in the balance as the nation prepares for the upcoming budget presentation. The energy sector, a crucial driver of economic growth, hinges on the right priorities being set to ensure growth, security, and sustainability. In a recent interview on CNBC Africa, Aluwani Museisi, Country Chair of Shell Downstream South Africa, shed light on the importance of infrastructure investments, transition into renewables, and the role of public and private partnerships in shaping the energy landscape. With a focus on the energy sector, Museisi emphasized the need for a strategic approach to address current challenges while paving the way for a sustainable future. The discussion revolved around key aspects such as the significance of infrastructure, the role of gas in the economy, and the importance of pricing and investment in alternative energy sources. Infrastructure emerged as a critical factor in ensuring the smooth functioning of the energy sector. Museisi highlighted the dependence on ports, rail infrastructure, locomotives, and pipelines for the efficient distribution of energy resources. He cited a recent incident where challenges in the transportation of jet fuel to O.R. Tambo International Airport underscored the importance of a well-maintained infrastructure network. The budget allocation for infrastructure entities will play a decisive role in shaping the future of the energy sector, striking a balance between immediate needs and long-term goals. Museisi also emphasized the role of gas in South Africa's energy mix, advocating for strategic investments in this area. He pointed out that gas offers a viable solution to meet the country's energy needs while reducing carbon emissions. The discussion further delved into pricing dynamics and the impact of global market trends on local fuel prices. Museisi highlighted the flexibility the Minister of Finance has in adjusting fuel levies to mitigate price fluctuations. Moreover, the conversation encompassed the importance of diversifying energy sources and investing in alternative technologies such as battery storage and solar power. Museisi stressed the need for a comprehensive approach that focuses on making significant investments in key energy sources, rather than scattered efforts across multiple technologies. Gas emerged as a focal point for future energy investments, presenting a 'no regret bet' for South Africa's energy transition. By prioritizing gas and other sustainable energy sources, the country can achieve a balance between energy security, economic growth, and environmental sustainability. As South Africa navigates the complex terrain of its energy landscape, the upcoming budget presentation will set the tone for addressing current challenges and preparing for a resilient and sustainable energy future.