- The Agence Française de Développement (AFD) has reaffirmed its commitment to supporting South Africa’s energy transition with investments exceeding 4 billion euros over the past 30 years.
- A critical aspect of AFD’s strategy is ensuring the transition is socially responsible, particularly for communities and workers directly affected by the decline in the coal industry.
The Agence Française de Développement (AFD) has reaffirmed its commitment to supporting South Africa’s energy transition with investments exceeding 4 billion euros over the past 30 years.
This funding is part of a broader initiative to facilitate a fair and sustainable transition from coal to renewable energy sources, reflecting AFD’s long-term partnership with South Africa that began in 1994. The partnership has focused on various sectors, including energy, water, transport, and urban development, to promote inclusive growth and environmental sustainability.
South Africa faces significant energy challenges, primarily due to its heavy reliance on coal-fired power generation, which accounts for about 80 per cent of its electricity supply. This dependence has made the country one of the highest carbon emitters globally, prompting urgent calls for action to reduce greenhouse gas emissions.
AFD’s investment aligns with the Just Energy Transition Partnership (JET-P), an initiative established during the COP26 climate conference in Glasgow. Under this partnership, South Africa is set to receive up to $8.5 billion from various international partners over the next few years to facilitate its transition away from coal. This funding will support projects that promote renewable energy development, such as solar and wind power, as well as enhance energy efficiency across the country.
A critical aspect of AFD’s strategy is ensuring that the transition is socially responsible, particularly for communities and workers directly affected by the coal industry’s decline. With approximately 90,000 people employed in coal-related jobs, there is an urgent need for alternative employment opportunities as South Africa moves towards greener energy solutions. AFD plans to invest in renewable energy projects and vocational training and support for sectors like green hydrogen and electric vehicles, which could create new job opportunities.
In addition to financial support, AFD aims to foster collaboration between local stakeholders and international experts. AFD hopes to enhance South Africa’s capacity to implement its energy transition effectively by providing technical assistance and innovative financing solutions. This includes developing infrastructure for renewable energy generation and improving grid services necessary for integrating intermittent power sources.
One notable project supported by AFD is the Tubatse Pumped Storage System in Limpopo Province. Recently, AFD signed a grant agreement worth €6.5 million with Eskom, South Africa’s state-owned electricity utility, to assist in developing this major infrastructure project. The Tubatse system will have a power generation capacity of 1.5 GW and will play a crucial role in stabilising the grid as more renewable energy sources come online.
As South Africa embarks on this transformative journey towards a low-carbon economy, AFD’s commitment reflects a growing recognition among international partners that sustainable development must be inclusive and equitable. This partnership also aims to create a model for other countries facing similar challenges in their energy transitions by prioritising local needs and ensuring that vulnerable communities are not left behind.