According to Rainer Baake, Germany’s special ambassador for the initiative, Germany is in talks with South Africa about providing an additional €720 million ($845 million) in concessional climate funding through the Just Energy Transition Partnership (JETP).
Speaking at a news conference, Baake stated that the proposed investment would fall under the JETP, a climate-finance deal between South Africa and a group of some of the world’s wealthiest nations aimed at assisting the country’s transition away from coal.
The alliance aims to expedite investment in renewable energy, power grid infrastructure, and climate-resilient development while mitigating the social and economic consequences of South Africa’s transition away from fossil fuels.
If approved, the new loans would bring Germany’s total climate-related funding for South Africa under the JETP to €2.68 billion, up from an original €986 million promise, according to Bloomberg.
The negotiations add to Germany’s expanding financial support for South Africa’s energy transition. In July, Berlin authorized a €500 million ($582 million) concessional loan to boost decarbonisation initiatives, after prior agreements signed in 2022 and 2023 that pushed total KfW-backed concessional finance to €1.3 billion.
Germany’s commitment is part of a larger $8.3 billion JETP package announced at COP26, which also includes investment from France, the United Kingdom, the United States, and the European Union.
Finance Minister Enoch Godongwana stated that the funding would improve South Africa’s short- and medium-term energy security while also furthering long-term decarbonisation. Approximately 80% of the country’s electricity is generated by coal, making it the most carbon-intensive economy in the G20.
