FOSSIL INFRASTRUCTURE LOCK-IN EFFECTS IN ELECTRICITY SYSTEMS

1. Introduction

Fossil infrastructure lock-in occurs when long-lived investments in coal, oil, or gas infrastructure make an electricity system economically, technically, and institutionally dependent on fossil fuels for decades. Power stations, pipelines, mines, transmission facilities, fuel-supply agreements, and associated industrial infrastructure normally require substantial capital investment and have long operating lives. Once constructed, governments and electricity companies may continue operating them to recover sunk costs, protect employment, honour contracts, and maintain security of supply.

In South Africa, this issue is particularly significant because the electricity system has historically depended heavily on coal. Government itself recognises that fossil-fuel electricity accounts for a large share of national emissions and that continued carbon-intensive energy creates economic and environmental risks.

2. How Fossil Infrastructure Creates Lock-In

Lock-in operates through several interconnected mechanisms. Economic lock-in arises where utilities have invested billions in fossil-generating assets and therefore seek to operate them over their expected economic lives. Premature closure can create stranded assets, unrecovered debt, and compensation or contractual issues.

Technological lock-in develops because electricity grids, fuel transportation systems, operating procedures, and technical expertise become structured around conventional generation. Institutional lock-in occurs where regulatory systems, procurement rules, subsidies, licences, and planning processes continue favouring established fossil technologies.

There is also a social lock-in dimension. Coal-dependent communities may rely upon mines and power stations for employment, municipal revenue, and local economic activity. Consequently, rapid closure without alternative employment and regional development can impose severe social costs. This explains the importance of the just transition principle.

3. Legal Framework

Section 24 of the Constitution of the Republic of South Africa, 1996 protects the right to an environment that is not harmful to health or well-being and requires environmental protection for present and future generations through measures securing ecologically sustainable development.

The National Environmental Management Act 107 of 1998 (NEMA) requires environmental consequences to be considered when major infrastructure is authorised. Long-term greenhouse-gas emissions and climate vulnerability are therefore relevant to decisions concerning fossil electricity infrastructure.

The Climate Change Act 22 of 2024, which commenced substantially on 17 March 2025, establishes a framework directed toward an effective climate response and a long-term just transition to a low-carbon and climate-resilient economy. Some provisions have deferred commencement pending implementing regulations.

Electricity-market reform is also relevant. The Electricity Regulation Amendment Act 38 of 2024 introduced reforms aimed at greater competition, investment in generation, and an independent transmission-system framework, potentially reducing structural dependence on historically dominant generation arrangements.

4. Case Law: Earthlife Africa Johannesburg v Minister of Environmental Affairs

Case Name/Citation: Earthlife Africa Johannesburg v Minister of Environmental Affairs and Others [2017] ZAGPPHC 58; [2017] 2 All SA 519 (GP).

Facts: The case concerned environmental authorisation for the proposed 1,200 MW Thabametsi coal-fired power station near Lephalale. The proposed plant was expected to operate until at least 2061. Earthlife challenged the authorisation because climate-change impacts had not adequately been assessed before approval.

Legal Issue: Whether climate-change impacts were legally relevant considerations that had to be properly assessed when deciding whether to authorise a long-lived coal-fired power project.

Judgment: The High Court held that climate-change considerations were relevant to environmental authorisation and found the Minister’s approach legally inadequate. The decision reinforced the requirement for meaningful climate-impact assessment in environmental decision-making.

Legal Principle/Ratio Decidendi: Environmental authorities must consider the climate consequences of carbon-intensive infrastructure when those consequences are relevant under environmental legislation.

Significance: The case is particularly important to fossil lock-in because it demonstrates that authorities cannot treat a coal plant merely as an immediate electricity-supply investment. Its emissions and environmental consequences across its long operational lifetime must also be considered.

5. Case Law: Fuel Retailers Association v Director-General

Case Name/Citation: Fuel Retailers Association of Southern Africa v Director-General: Environmental Management 2007 (6) SA 4 (CC); [2007] ZACC 13.

Facts: The dispute concerned environmental approval for a proposed filling station in Mpumalanga.

Legal Issue: Whether environmental authorities properly considered the socio-economic and environmental sustainability implications of the proposed development.

Judgment: The Constitutional Court upheld the appeal and required reconsideration of the authorisation.

Legal Principle/Ratio Decidendi: Sustainable development provides the framework for reconciling environmental protection with legitimate economic and social development.

Significance: Applied to electricity infrastructure, the principle requires decision-makers to examine long-term sustainability rather than concentrating exclusively on immediate economic benefits or electricity demand.

6. Conclusion

Fossil infrastructure lock-in is therefore simultaneously an economic, technological, environmental, social, and legal problem. Long-lived fossil investments can constrain future energy choices and increase stranded-asset and climate risks. South African law increasingly requires electricity planning to integrate sustainability, climate impacts, energy security, and just-transition considerations. Effective governance therefore requires careful scrutiny of new fossil investments alongside renewable generation, storage, transmission expansion, worker protection, and economic diversification.