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Germany pledges funds to help South Africa ditch coal

November 2, 2021

Germany's environment minister says South Africa's coal phase-out "has the potential to become a blueprint for other regions." The US and several European countries pledged billions on clean energy development.

South Africa's Lethabo coal plant
South Africa gets most of its electricity from coal-fired power plantsImage: Themba Hadebe/dpa/AP/picture alliance

The US and several European nations, including Germany, have pledged $8.5 billion (€7.3 billion) to help South Africa phase out coal and expand renewable sources of energy.

The partnership was announced at the COP26 climate conference in Glasgow on Tuesday. Germany said it planned to invest €700 million as part of the plan, which is also backed by the UK, France and the European Union.

South African President Cyril Ramaphosa said that the agreement marked a "watershed moment" for South Africa and the world.

"It is proof that we can take ambitious climate action while increasing our energy security, creating jobs and harnessing new opportunities for investment, with support from developed countries," Ramaphosa said in a statement.

What do we know about the initiative?

The funding will be provided to South Africa, Africa's biggest carbon emitter, over the next five years in the form of grants and loans.

The initiative is expected to support the country's transition away from coal-fired power stations and promote the use of clean technologies, including green hydrogen. It also aims to help to create new jobs for the tens of thousands of people who work in South Africa's coal mining sector.

South Africa's government said the money would help it deliver on a more ambitious pledge to reduce emissions by 2030.

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Energy transition in Africa's biggest emitter 

More than 90% of South Africa's electricity comes from coal-fired plants, a major source of greenhouse gas emissions.

Transitioning away from coal and other fossil fuels is seen as crucial if countries are to meet the goal stipulated in the 2015 Paris Agreement of limiting global warming to 1.5 Celsius above preindustrial levels.

German Environment Minister Svenja Schulze said, "a successful coal phase-out in South Africa has the potential to become a blueprint for other regions."

US President Joe Biden did not specify how much the US would contribute, but he told leaders at COP that "closing South Africa's coal plants ahead of schedule and investing in clean alternatives" would boost global efforts to reach net zero emissions.

British Prime Minister Boris Johnson said the partnership would help move the world toward meeting its climate targets by "choking off international finance for coal."

nm/wmr  (AP, Reuters, dpa)