Ramaphosa: SA will require R1.5-trillion to fight climate change

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South Africa will negotiate for more money from the Just Energy Transition partners at Cop27 set to begin on Sunday in Sharm el-Sheik, Egypt. The partners include France, Germany, the United Kingdom, United States and the European Union.

This is according to President Cyril Ramaphosa, who said the $8.5-billion pledged by these nations at Cop26 last year in Glasgow, Scotland, was not enough for South Africa. The money was meant to help the country shut down coal-fired power stations and repurpose them for renewable energy, such as solar and wind.

“The country will require about R1.5-trillion ($84-billion) over next five years to meet targets in transitioning from coal to renewable energy,” he said at a meeting of the Presidential Climate Commission, citing the country’s climate investment plan.

“This is just the five years that the R1.5-trillion will be necessary. Going forward, much more money will be needed,” he added.

“With COP27 taking place in Africa, it presents an opportunity to advance African priority issues. Namely, raising the ambitions on mitigation, adaptation and support to developing countries; advancing arrangements for loss and damage; building on progress made in Glasgow on the importance of a just transition and advanced discussions on the special needs and circumstances of Africa,” he said.

More debt?

Ramaphosa added that the just energy partnership investment plan had been released to countries for deliberation and South Africa was aware that transition could come with debt.

He said South Africa needed financing to fight climate change in a way that matched the financial capabilities of the country and to ensure it didn’t place a burden of debt on it.

“We seek a package that upholds the development and climate finance principles and obligations that are due to developing countries and is inclusive and just,” he said.

This comes as the World Bank approved $497-million (R9.1-billion) in financing to help South Africa lower its greenhouse gas emissions by repurposing the Komati coal-fired power plant in Mpumalanga to generate clean energy.

“Reducing greenhouse gas emissions is a difficult challenge worldwide, and particularly in SA, given the high carbon intensity of the energy sector,” World Bank Group president David Malpass said in a statement.

“This is part of efforts to replace SA’s carbon-dependent power supply with greener alternatives to reduce carbon emissions and improve air quality, with the power sector contributing to more than two-fifths (41%) of the country’s CO₂ emissions.” 

A just transition

Developed countries have agreed to make grants and loans available to help South Africa transition to wind and solar energy. In the COP27 negotiations, it is believed South Africa will appeal for grants, instead of loans, as we’ve previously reported. 

This is despite Ramaphosa saying the $8.5-billion might sound substantial but was not enough. “The World Bank has projected that we will need a couple trillion rand to navigate our way through a proper and just transition,” Ramaphosa said in response to questions in the National Assembly on Thursday afternoon.

“Our coal-fired power stations, a number of them, are nearing the end of their lives. As they get there, they need to have a just transition,” said the president.

Ramaphosa will travel to the summit next week as leader of the South African government delegation.