SA energy transition could be model for others, says climate funds investor

Wind turbines

SOUTH Africa’s energy transition from coal to renewables could be a template for other nations to do the same, according to the head of an $8.5bn group of climate funds interviewed by Bloomberg News.

“I absolutely think that South Africa can serve as a demonstration for many other countries globally on how to do this,” Climate Investment Funds CEO Mafalda Duarte told the newswire from the COP26 climate summit. “There’s a clear momentum and a recognition now from many parties that there’s a need for an energy transition.”

South Africa, the world’s 12th-biggest emitter of greenhouse gases, is currently dependent on coal for more than 80% of its power. President Cyril Ramaphosa has set up a commission to advise on how to mitigate climate change, and the cabinet recently adopted a more ambitious emissions-reduction target, said Bloomberg News.

On Tuesday, the country secured a commitment for R130bn in finance aimed at moving the country away from coal-fired electricity production, and boosting the electric vehicle and green hydrogen sectors.

The commitment was agreed in a political declaration finalised at COP26 in Glasgow, and is the first significant financing deal to emerge from the landmark climate conference, according to a report by BusinessLive. The governments of the US, UK, France and Germany are among those that are assisting in providing finance to South Africa.

“Through the political declaration issued today to establish this partnership, partner countries will mobilise an initial $8.5bn (R131bn) over the next three to five years through a range of instruments, including grants and concessional finance, to support the implementation of our revised NDC through a just transition to a low-carbon and climate-resilient economy,” said BusinessLive citing a statement by Ramaphosa.