The aim of this paper was to quantify the external costs of mining and transporting coal to the Kusile coal-fired power station in eMalahleni. Monetary values were estimated for a number of impacts including its contribution to climate change, human health effects of classic air pollutants, mortality and morbidity, impacts of water pollution and water consumption. The results of the study disclosed that coal mining and transportation will inflict costs to both the environment and humans of between R6 538 million and R12 690 million per annum, or between 20.24 c/kWh and 39.3 c/kWh sent out. The external effect of water consumption (opportunity costs of water) constitutes over 90% of the total cost, followed by global warming damage costs and ecosystem services lost due to coal mining. The estimated externality cost is approximately between 50% and 100% of the current average electricity price.
This study estimates the opportunity costs of using woody invasive alien plants (IAPs) for value-added products by estimating the net economic return from the value-added industries in South Africa. By 2008, IAPs were estimated at the national level to cover an area of 1 813 million condensed hectares in South Africa. A market has formed around their use for value-added products (VAP) like charcoal, firewood and timber in the Kouga, Kromme and Baviaans River catchments in the Eastern Cape province of South Africa. The net economic return from these value-added industries was estimated for the purpose of several management scenarios, and was then used to estimate the opportunity costs if they were not used. A system dynamics model was used to value and analyse the Net Present Value of clearing in the study area and to estimate the opportunity cost of the non-use of VAP. The study showed that the inclusion of VAPs in the project would yield higher net present values for clearing. The findings from this study suggest that a cofinance option of the total economic returns from VAP for clearing costs is the best management scenario for reducing the costs of clearing and maximising the net economic returns from clearing. The net economic returns of VAPs by 2030 are estimated at R23 million without the co-finance option and R26 million with the option. The cumulative net income from VAPs with co-financing over the period of valuation is estimated to be R609 million.
ARTICLE INCLUDES: Supplementary material × Data set
FUNDING:National Research Foundation (South Africa) Coal-based electricity is an integral part of daily life in South Africa and globally. However, the use of coal for electricity generation carries a heavy cost for social and ecological systems that goes far beyond the price we pay for electricity. We developed a model based on a system dynamics approach for understanding the measurable and quantifiable coal-fuel cycle burdens and externality costs, over the lifespan of a supercritical coal-fired power station that is fitted with a flue-gas desulfurisation device (i.e. Kusile Power Station). The total coal-fuel cycle externality cost on both the environment and humans over Kusile's lifespan was estimated at ZAR1 449.9 billion to ZAR3 279 billion or 91c/kWh to 205c/kWh sent out (baseline: ZAR2 172.7 billion or 136c/kWh). Accounting for the life-cycle burdens and damages of coal-derived electricity conservatively, doubles to quadruples the price of electricity, making renewable energy sources such as wind and solar attractive alternatives.
Significance:• The use of coal for electricity generation carries a heavy cost for social and ecological systems that goes far beyond the price we pay for electricity.• The estimation of social costs is particularly important to the electric sector because of non-differentiation of electricity prices produced from a variety of sources with potentially very dissimilar environmental and human health costs.• Because all electricity generation technologies are associated with undesirable side effects in their fuelcycle and lifespan, comprehensive comparative analyses of life-cycle costs of all power generation technologies is indispensable to guide the development of future energy policies in South Africa.
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