President Cyril Ramaphosa's administration is renegotiating with Climate Investment Funds (CIF), associated with the World Bank, to avoid the imminent closure of three coal-fired power stations, Bloomberg reported, citing project overseers in the president's office.
The government is seeking to delay the shutdown of these plants, owned and operated by state-owned energy company Eskom, until March 2030 due to energy security concerns while still working to reduce emissions.
This could affect up to $2.6 billion in financing from development banks and other sources, with an initial $500 million from the CIF’s Accelerating Coal Transition program, part of a $9.3 billion climate pact.
Daniel Morris from CIF confirmed to the media outlet that South Africa is updating its investment plan, which is expected to be ready by the fall.
However, four officials reportedly indicated that this new plan significantly changes the original deal, with one noting concerns about whether Eskom's plants can operate at reduced levels, potentially compromising emissions reduction strategies.
Despite being the most carbon-intensive fossil fuel, coal still accounts for just over one-third of global energy generation, according to Eskom. Coal is projected to maintain its share of the total energy production market for some years to come. China, the US, India, Japan, and South Africa, collectively, consume 82% of the world's coal.