South Africa's Climate Plan: Navigating Through Funding Hurdles and Coal Dependency

South Africa's climate programme has spent $1.9 billion of its allocated $11.6 billion, focusing on power grid expansion and transitioning from coal. Despite international pledges, internal politics and complexity have slowed progress, threatening emissions targets. The programme aims to provide new skills and economic opportunities for coal-dependent communities.

South Africa's donor-funded climate programme has allocated $1.9 billion out of its $11.6 billion budget towards expanding its power grid and mitigating coal region decline as it transitions to renewable energy, according to two anonymous sources involved in the initiative.

A substantial $488 million has been directed towards electricity projects. The programme also focuses on revitalizing the coal province of Mpumalanga, with initiatives like a potential green hydrogen hub and skills training. Originally pledged at COP26, the $8.5 billion commitment has grown as countries like Denmark and Canada joined. However, progress remains slow due to the programme's complexity and South Africa's internal politics, potentially missing its 2030 emissions targets.

Despite its industrial capabilities and renewable energy potential, South Africa's shift from coal, which accounts for 80% of its power and employs 90,000 people, poses socio-economic challenges. The transition aims to offer new skills and opportunities, particularly for the vulnerable, to avoid resistance. Policy loans have enabled reforms like new legislation promoting competition in the power sector. However, President Ramaphosa has noted that grants, comprising $676 million of the total, are insufficient.

(With inputs from agencies.)