(3 Minutes Read)
If South Africa were to achieve its decarbonisation commitments by 2050 it would require USD 98 billion to run the ‘Just Energy Transition Investment Plan’ for five years, stated President Cyril Ramaphosa. Ramaphosa was speaking at the Climate Resilience Symposium in Pretoria. He stated the plan would drive huge investments in the electricity grid, electric vehicles, economic diversification, and skills development.
The Just Energy Transition Implementation Plan, which was approved by the cabinet last year, will guide South Africa’s transition to a low-carbon economy through the scaling up of renewable energy sources and reducing reliance on coal. The president said climate change is as much an economic issue as it is a scientific, human rights, and developmental issue because it has a direct and material effect across the economy. Disruptions caused by climate change increase the costs of doing business, undermine competitiveness and also dampen prospects for increased employment. They result in lower tax revenue and increased expenditure on disaster relief, Ramaphosa said.
The treasury, along with the Presidential Climate Commission, is to launch the Just Transition Financing Mechanism report at the three-day symposium. It will outline the financing of the energy transition and how the money will be raised. Climate finance is also crucial for our transition. We need substantial investments to build sustainable infrastructure, to develop green technologies, and support social programmes, Ramaphosa said. As per the African Development Bank, just transition finance is different from climate finance. Climate finance relates to funding climate action and steps that can be taken to fight climate change and is not specifically designed to consider the goal of leaving no one behind and financing the effects of decarbonising activities on vulnerable workers and communities.
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A just transition finance approach must seek opportunities to connect green assets — which help to reduce energy, water, and natural resource use — with positive social outcomes and the effects on workers and communities. The president announced that the Just Energy Transition Funding Platform would be launched in the next few months. The purpose of the platform is to be a matchmaker between suppliers of grant funding and potential beneficiaries; to provide support for project originators to help them prepare plans and apply for grants and to provide the public with transparent data and analysis on the allocation of grant funds to projects. The president said the funding platform would be an important precursor to a broader Just Transition Financing Mechanism.
