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UNEP Green Economy Advisory Services – South Africa


The United Nations Environment Program (UNEP) has partnered with South Africa to help develop a national Green Economy Plan. The Green Economy Advisory Services provides governments with policy advice, technical assistance and capacity building to help governments develop and implement initiatives to transform and revitalize their economies. For information on the program globally, click here.

Overview

In May 2010, the South African government hosted a Green Economy Summit to set the stage for the formulation of a Green Economy Plan. UNEP is providing a technical support to the Department of Environmental Affairs (DEA), through a quantitative assessment of potential economic, social and environmental effects of scaling up investment in key priority sectors.This work is led by technical institutions in South Africa, with the participation of several government departments.

A model tailored to South Africa was developed based on UNEP Green Economy Report. In essence, the South Africa Green Economy Model (SAGEM) utilized the Threshold 21 (T21) framework of the Millennium Institute, which integrates several sectoral models. The model traces the effects of modelling a proportion of Gross Domestic Product (GDP) to core sectors prioritized to support a green economy for South Africa, namely: energy, agriculture, transport and natural resource management.

SAGEM simulates green investment scenarios that are aimed at promoting economic growth, job creation and a transition towards low carbon development and resource efficiency in comparison to the baseline scenario. The model is based on the country’s medium- (2020) and long-term (2030) policy goals and targets defined in South Africa’s New Growth Path and the draft National Development Plan (NDP) – Vision 2030.

Key findings

Economic growth. All green investments stimulate the growth of GDP relative to a business-as-usual scenario (BAU). Investments in the green economy could realize a further growth in real GDP of over 2% by 2030 relative to 2012.

While this also translates into an increase in per capita income, the improvement stipulated in the NDP will not be realized and will require higher investments than the amount simulated.

Employment: Green economy creates jobs and the extent of the growth is dependent on the investment option chosen. Overall, green economy investments stimulate job creation relative to the BAU scenario. However, prioritizing investments in the energy sector will maximize employment creation potential (as simulated in the GETS scenario) due to the additional infrastructure requirements in this sector.

If the investments are spread equally across all sectors, then the agriculture sector will deliver the highest employment creation potential.

Natural resource management while maintaining agricultural land. Investments in the green economy will not lead to a reduction in land requirements in the agriculture sector, but will positively contribute to additional restored land. A targeted investment that prioritizes NRM results in an additional 39% restored land by 2030 and higher water availability.

Electricity diversification mix: With a green investment targeted to expand renewable electricity generation, the share of renewable energy would reach 27% by 2030 in the GETS scenario and 17.9% in the GE2 per cent scenario.

A more aggressive green economy investment intervention than GETS and GE2 per cent would be required to achieve the stipulated target in the NDP (of 33% by 2030). Green economy contributes to energy efficiency resulting in a reduction in energy demand and lowered investments in power supply.

A 2% (of GDP) investment in green economy, which is equally distributed equally among all the sectors, including energy efficiency, results in the reduction of energy demand. In the power sector, this translates into the reduction of coal power generation capacity. The reduction of energy consumption of the transport sector would also be realized.

Outputs and resources

To view the full country profile for South Africa on the UNEP website click here.

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