A top presidential official said on Thursday that South Africa is seeking low-cost financing for more than 400 billion rands ($27.6 billion) in electrical infrastructure as part of its efforts to move away from severely polluting coal.
South Africa aims to spend more than 180 billion rands on cleaner power generation, 120 billion rands on transmission equipment, as well as substations, transformers, and distribution technologies, thanks to a funding facility funded by wealthy nations and development finance agencies.
Currently, coal is used to create more than 80% of the country’s electricity, making it the world’s 12th largest carbon emitter. However, ahead of the United Nations COP26 climate summit in November, the administration announced a more aggressive emissions reduction target last month.
In a presentation, presidency official Rudi Dicks said, “South Africa’s message: We are prepared to achieve a large carbon reduction, but this must be financed by developed countries on concessional terms.”
Eskom, the state-owned power company, has announced that it is seeking up to $12 billion (about 180 billion rands) in funding from international lenders to help it transition away from coal.
However, according to Dicks’ presentation, that figure only included the cost of constructing more than 7,000 megawatts (MW) of additional generation from solar, wind, and natural gas to replace coal-fired power plants that will be retired.
It also stated the country was looking for grants and low-interest loans to help pay for a transmission grid expansion of at least 8,000 kilometers (4,970 miles), reinforce distribution corridors, and establish a fund to help the province diversify its economy.
According to one presentation, the United Kingdom, the United States, Germany, and France, as well as French and German development banks and the World Bank, might contribute funding.
Eskom announced in August that it aims to decommission between 8,000 and 12,000 MW of coal-fired power plants over the next decade.
