FSA plays key role in national crisis control

Outgoing FSA Executive Committee chairperson Themba Vilane applauded the resilience of the forest sector despite another challenging year. (Photo: Samora Chapman)

Forestry South Africa held its 21st AGM in the KZN midlands in May, attended by a record number of members and invited guests who were treated to two blockbuster keynote presentations that helped to put the crises facing South Africa into perspective …

What a year 2022 turned out to be for the South African forestry sector! After surviving the Covid pandemic in 2020 and the failed insurrection and looting spree that took place in KZN and Gauteng in 2021, forestry stakeholders were hoping for a more stable and prosperous 2022. But the crises just shifted … to energy (or the lack of it) with load shedding ramping ever upwards; and to logistics where a strike by Transnet workers brought freight rail – that was already in a state of decline – to a standstill in October, costing the battered SA economy R1 billion per day in lost opportunities.

Meanwhile the impacts of Russia’s invasion of Ukraine disrupted international markets, creating logistics bottlenecks and causing prices of commodities like fuel, coal, tyres and fertilizer to skyrocket.

In between all of that, the resilient forest sector survived – even thrived in many instances – aided and abetted by the Forestry South Africa team which muscled its way closer to the levers of power to help find solutions for a number of pressing national issues.

Here is a brief highlights package of FSA activities during the year 2022 that were covered by outgoing FSA chairperson Themba Vilane during his address at the recent FSA AGM, and were elaborated upon in his Foreword in the recently published FSA Annual Report.

Happy to be back in the real world … members and guests turned out in their numbers to attend the FSA AGM at Fern Hill Conference Centre in Tweedie, KZN. (Photo: Samora Chapman)

Ports and rail

The FSA team established regular meetings with the CEO of Transnet and her top management team, and task teams working on ports and rail met throughout the year, playing a hand in bringing the Transnet strike to an end. As a result of this involvement, Executive Director Michael Peter was asked to serve in a President-led task team working on the reforms needed to address the use and recapitalisation of rail and ports in South Africa.

FSA is also serving on a Presidency-led energy committee which is playing a key role in addressing the energy crisis.

“Having our association at the forefront of these national crises interventions is a great testimony to the regard in which our sector is held,” said Themba.

Research and innovation

Forestry’s growing partnerships with government also bore fruit with FSA securing Sector Innovation Funding of R35.2 million from the Department of Science and Innovation. This funding serves to increase forestry’s research capacity in crucial areas.

Furthermore, the signing of an MoU between FSA and the Department of Forestry, Fisheries and the Environment (DFFE) will bring an additional R9 million per year for forest protection.

Recommissioning of state plantations

Perhaps the biggest news of the year came just before Christmas when the DFFE called for expressions of interest from the private sector for the operation of 22 000 ha of state-owned forestry plantations in the Western Cape. These former pine plantations have been lying dormant for anything between five to 20 years, as they were handed over to the receiving agents after clear-felling at rotation end by the previous lease holder, MTO Forestry. They were originally part of government’s forestry exit strategy in the Western Cape, but following an outcry from industry stakeholders and further research, Cabinet decided in 2008 to recommission these plantations.

After years of lobbying by FSA and other stakeholders, the process of bringing them back into forestry has begun at last. This is good news indeed and will revitalise forestry and sawmilling in the Western Cape (see story on SAF Online - https://saforestryonline.co.za/articles/w-cape-state-plantation).

“We hope that this signals the start of the process for the rest of the Category B and C state plantations which have been overrun by timber thieves and criminal syndicates …” said Themba.

Incoming FSA Executive Committee chairperson Andrew Mason (medium growers group) and vice-chairperson Buhle Msweli (small-scale growers group). The Executive Committee chair and vice-chair rotate between the Large, Medium and Small Growers Groups every year. (Photo: Samora Chapman)

Land reform

On the land reform front, the FSA Land Committee has come up with concrete proposals to bolster support for communities who have come into forestry through land reform initiatives, in an effort to ensure that a sustainable fibre supply from these plantations is maintained. These include a feasibility study stage in the land restitution process to better inform settlement negotiations; a suite of appropriate settlement models; a crop ownership transfer model and the provision of appropriate post-settlement support for land reform beneficiaries.

Timber volumes up

Finally, Themba applauded the fact that timber sales recorded by FSA members during 2022 were the highest since 2018 at 13.970 million tons (6.2% higher than 2021 volumes). Gum sales were the best performer at 7 million tons (18.5% higher than 2021 volumes), wattle was second best at 1.4 million tons (up 15.5% on 2021 volumes) and pine at 5.5 million tons (down by 7.8% vs 2021 volumes).

These timber sales volumes would have been much higher had it not been for the devastating floods that occurred in KZN in April and the impacts of the rail and port strike in October, the consequences of which are still being felt across all sectors of the economy.

“Should the country succeed in addressing the two biggest challenges we are facing in logistics and energy, this bodes very well for the future of timber growers, especially with the major investments which have been made by our sector in pulp and paper, particle board, sawmilling and renewable energy,” said Themba.

Celebrating women … women are playing an increasingly active role in the previously male-dominated forestry sector in South Africa. (Photo: Samora Chapman)

Service acknowledgements

The FSA team paid tribute to two stalwarts of the Forestry Sector, Brian Aitken and Murray Mason, both of whom have put in multiple stints as FSA office bearers over the years, and who have contributed enormously to the success of the sector.

FSA Executive Committee for 2023/24

Ex Large Growers Group

Duane Roothman (SAPPI)
Themba Vilane (Mondi)
Sean Brown (Merensky)
Itumeleng Langeni (MTO)
Tsepo Monaheng (SAFCOL)
Ferdie Brauckmann (TWK)
Penwell Lunga (PG Bison)
Gerald Stoltz (York Timbers)
Mark Armour (co-opted)

Ex Medium Growers Group
Andrew Mason - KZN (MGG Chair) (FSA Chairperson)
Murray Mason - KZN / S Cape
Heiner Hinze - Mpumalanga / Limpopo
Graeme Freese - Past MGG Chairman
Danny Knoesen - NCT

Ex Small Growers Group
Buhle Msweli KZN Provincial Chairperson (FSA Vice-Chairperson)
Musa Mcwensa KZN Deputy Chairperson
Fhatuwani Netsianda Limpopo Provincial Chairperson

Joyce Shozi (chairperson King Cetshwayo District small-scale growers), Sanele Zuma (Siyaqhubeka Forests), and Nelly Ndlovu (CEO Mondi Zimele and chairperson of the Forest Sector Charter Council. (Photo: Samora Chapman)
Linda Vilakazi (Siyaqhubeka Forests), Maurice Makhatini (Mondi) and Siya Kobese (Sappi). (Photo: Samora Chapman)
Left to right: Mbali Luthuli, (Assistant Director, Planning, KZN DFFE), Wongeka Kutshwa (Deputy Director, Forestry Development, KZN DFFE), Pumeza Nodada (Deputy Director-General, Forestry Management, DFFE) and Noluthando Kobese (Chief Forester, Forestry Regulation, KZN DFFE). (Photo: Samora Chapman)

Energy … the new GOLD

Keynote speaker JP Landman finds a silver lining in the energy crisis. (Photo: Samora Chapman)

Keynote speakers at FSA’s AGM slice and dice the energy crisis and uncover the opportunities that await private sector entrepreneurs …

There is a massive shift taking place in South Africa’s energy sector, from the current public sector energy monopoly to private sector participation, that will end load shedding roughly 18 months from now.

This startling revelation from highly respected political and trend analyst JP Landman caught delegates at the Forestry South Africa AGM unawares. We are so used to hearing about the energy crisis, we suffer the consequences of it at home and at work every day, and we expected more bad news from the keynote speaker to follow the already bad news that has cast a veil of gloom over our lives since forever.

But JP wasn’t joking, although his talk was full of light-hearted banter and sharp-witted humour that sliced through the brain fog enveloping our lives like a hot knife through butter.

South Africa currently has a power ‘baseload’ gap of 6 000 MW, explained JP. Baseload is the dependable power that is always available, and is crucial to meet the fluctuating energy demands of our nation.

There are currently 18 private sector-driven renewable energy projects that are already on the ground in South Africa, explained JP. These projects have the capacity to deliver 18 000 MW which will end load shedding by end of 2024, or by mid 2025 latest. Just 5 000 MW of renewable energy will cut load shedding by 61%, and we could achieve that milestone by the end of this year.

This will be achieved with no additional power contribution from existing state-owned power stations.

“Eskom is a government-owned monopoly that is collapsing in on itself,” said JP. This has led to the current energy crisis which has opened the door for private sector participation in power generation.

“If things were working well, the private sector would never get a look-in,” he said.

He described this as a “massive shift” that will bring South Africa into line with the rest of the world.

“Most countries in the world have moved away from government energy monopolies, because they don’t work,” said JP.

Half of Eskom’s generation capacity will close down over the next decade, he predicted. Eskom will expand the national grid, but there will also be mini-grids and micro-grids established at local and neighbourhood level that will distribute privately generated renewable power to a few households, or a small village, or a cluster of businesses. The technology that makes this possible is already available.

“By 2034 our energy system will be very different from what it is now, and we will have forgotten about load shedding,” said JP.

JP Landman captivates the audience with his sharp tongue and expert analysis, shedding light on the future prospects of our country. (Photo: Samora Chapman)

Medupi and Kusile will continue to eat coal for another 40 years, and gas and nuclear will be added to the energy mix. Gas is much cleaner than coal and you can switch it on and off as and when you need it, so it plays an important support role in a country’s energy mix.

From a business perspective, this energy transition to renewables is critical.

“We need to cut our emissions by 17% - we have to go green otherwise we will be barred from exporting our products to important overseas markets. Eskom and Sasol are the worst offenders.

He predicted that the big shift will see the rise of energy traders who will be sourcing clean energy and selling it on to customers.

“In a few years you will be liaising with an energy trader – not Eskom,” said JP. “This is already the case overseas.”

Municipalities will be in crisis, as they won’t be making money out of on-selling electricity. But here too, out of crisis comes the possibility of change, and they will have to jack up their services in order to survive.

R1.5 trillion will have to be invested in this new economic sector, and this presents a “HUGE” opportunity.

“Energy is the new gold,” he said.

Turning to the political front, he was equally forthright. Progress is restoring the dignity of every citizen in their everyday lives. This, he said, can only be achieved by a grand government coalition that has the support of 75% of the people.

“Nobody can do it on their own. We need shared values, we need inclusivity …”

Don’t delegitimise South Africa’s democracy, he pleaded, we just need a more or less helpful attitude towards one another and to unleash the power of science and technology to restore dignity to people.

“Be grateful for the fact that we live in peace.”

Blackout blues

Following that blockbuster presentation was always going to be a tough ask, but energy analyst and consultant Chris Yelland got right down to work with a snapshot of South Africa’s energy availability factor which is on a downward trend. This will have to bottom out before it gets better - and the bottom hasn’t been reached yet.

Chris Yelland dissects the risks of a total national electricity blackout. (Photo: Samora Chapman)

But like JP Landman’s presentation, Chris also offered a silver lining, as he urged the forestry sector to “take ownership of your own energy future”.

Basically, the private sector must get involved in energy generation, and the forestry sector is in the right space to achieve significant energy independence.

“If you are waiting for government to do it you will wait a long time. What is the forestry sector bringing to the table in terms of energy generation capacity?”

But he also shed some light on the dark side of the energy equation - a total national blackout – and offered some slightly comforting news to balance this very uncomfortable prospect.

Chris explained that a ‘blackout’ is caused by a major disturbance on the national grid, and it can happen in one second. It is not a gradual thing. For example if the line to the Western Cape trips and a power unit at Koeberg goes down simultaneously … unlikely but it is possible.

He said the level of load shedding currently being experienced is not an indicator of the likelihood of a total blackout. However it has had a galvanising effect and we are now much better prepared for this eventuality than we were when load shedding began a few years ago.

“Even though the probability of a national blackout is very low, the consequences are so severe that even the insurance companies won’t cover them.”

A blackout could last for a few days, or a week, or even four weeks. The consequences of an extended blackout are not pretty:-

• No power, no lights, no refrigeration
• No cash, no banks, ATMs or card machines
• No food, shops close
• Petrol stations close, no petrol, no diesel
• Mobile phones and telecom towers go flat
• Standby generators run out of diesel
• Transportation grinds to a halt
• No water in the taps
• Social unrest and looting spreads
• Infrastructure theft and vandalism
• Anarchy.

He presented three national blackout scenarios, which will determine the severity of the consequences that follow:-

Scenario 1 – OPTIMISTIC – First up in 2 hours; last up in 1 week.
Islanding of key power stations works perfectly
No failures in restoration, which works perfectly
Impact of civil unrest and looting not a factor.

Scanario 2 – REALISTIC – First up in 2 hours, last up in 2 weeks.
Some failures in islanding and restoration
Hampered by some unrest and looting but no electrical infrastructure damaged.

Scenario 3 – PESSIMISTIC – extended blackout lasts up to 4 weeks.
Blackout takes place at same time as Eskom labour and/or civil unrest
Significant islanding failures and major logistical reconnection issues
Line, cable, switchgear, transformer and electrical infrastructure theft and vandalism.

Applause for the keynote speakers, acknowledging the knife-edge between crisis and opportunity. (Photo: Samora Chapman)

While businesses (and private households) should have some contingency plans in place to mitigate the consequences of a blackout, the focus of our efforts should rather be on taking control of our own energy requirements.

“The agricultural sector (including forestry) has a key role to play and should announce measurable, new self-generation targets … You are the solution, you need to take responsibility for your own energy requirements,” he concluded.