South Africa submits US $8.5bn plan for green energy

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South Africa submits US $8.5bn plan for green energy

South Africa has submitted a US $8.5bn investment plan to donors to help the country’s transition to renewable energy.

The country’s presidency spokesperson Vincent Magwenya confirmed that the plan and said officials are racing to finish the deal before the COP27 climate talks that will take place in Egypt, starting on November 6. The proposal could become a potential model for other emerging economies that seek to transition from coal to renewable energy

“A draft of the investment plan, which outlines the investments required to achieve South Africa’s ambitious climate targets … has been finalized and will be shared with key stakeholders before it is submitted to cabinet for approval,” he said.

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Power generation

The funds have been promised by France, Germany, the European Union, the United Kingdom and the United States during the last climate talks in Glasgow, to kick-start South Africa’s move from coal to renewable energy, mostly offered in the form of concessional loans.

In order to get the needed US $8.5bn from donors, South Africa must show its plan will reduce its carbon emission by more than it was planning to do under already existing climate commitments. However, the shift of South Africa’s economy into renewable energy is estimated to cost at least US $250bn over the next three decades.

South Africa is the world’s 12th biggest carbon emitter – 430 megatonnes of CO2 in 2019 – placing it five places ahead of Britain, an economy eight times its size. 80% of South Africa’s power generation comes from coal fuels. Consequently, it aims to become a hub for green hydrogen and electric vehicle manufacturing.

The country has been experiencing its worst year of electricity outages, with state-owned energy provider Eskom, which generates more than 90% of South Africa’s power, struggling to meet demands.