InvestSA

Green transport

Overview

South Africa has embraced decarbonising the transport sector and the government recently released its Green Transport Strategy. Private sector manufacturers are also collaborating on efforts to develop the industry, with an emphasis on improving energy storage technologies and charging infrastructure.

Value proposition

There is both an environmental and an economic rationale for South Africa adopting green vehicles and green energy to fuel them. The country is dependent on imported oil, the price of which fluctuates unpredictably, and the environmentally unfriendly production of fuel from coal. Electric vehicles and vehicles powered by fuel cells, natural gas or biogas promise savings in pollution and money – but need significant investment.

Opportunities

South Africa’s industrial policy action plan emphasises the potential of fuel cell technology, with several key projects already implemented by government and industry with the help of development finance institution money. The framers of the plan believe fuel cells will be the future – especially for long-distance and heavy vehicle transport. Fuel cells use platinum, offering beneficiation of this mineral of which South Africa is the top producer, making fuel cell vehicles doubly attractive.

At the same time, it is clear that alternate fuels to petrol and diesel, such as biofuels, and compressed natural gas and compressed biogas are also available to reduce carbon emissions. Biofuels have been identified as a priority area for foreign direct investment.

Encouraging the uptake of electric or hybrid vehicles, and retrofitting or manufacturing vehicles that use alternate fuels, is another sustainable energy path the country is pursuing. Electric buses have already been deployed in at least one municipality. South Africa has a motor industry, but it is based on traditional petrol and diesel fuel vehicles, and as in other green technologies, investment is needed to develop local electric vehicles.