SAWEA supports green financing deal
Noupoort Wind Farm in Northern Cape, South Africa. Photo provided by SAWEA.

The South African Wind Energy Association (SAWEA) has put its voice of support behind the first of its kind green financing deal, announced at COP26 climate talks last week.

Speaking on behalf of the wind power industry and the country’s broader renewable energy sector, this deal, which comprises multi- and bi-lateral grants, concessional loans, guarantees and private investment, will provide the impetus for South Africa’s accelerated uptake of green energy.

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SAWEA Board Member, Mark Tanton, said: “We view our sector as a key implementer for the country to decarbonise its power sector and increase its energy availability. Hence, we look to the various policymakers within the Department of Forestry, Fisheries and the Environment, the Department of Mineral Resources and Energy; and the Department of Public Enterprises to facilitate and lead this transition, which will no doubt be abetted by this financing deal.”

The $8.5 billion green financing deal, committed by the UK, France, Germany and the US, is intended to speed up South Africa’s transition away from coal and represents a new model of green financing for emerging economies. This forms part of the global Accelerating Coal Transition Investment Programme formulated by the Climate Investment Funds (CIF). The programme is the first to target developing countries that lack adequate resources to finance the shift away from coal, which is crucial to limit the global temperature rise to 1.5 degrees Celsius by 2030.

“This makes sense as sustainable, cost-effective financing, is necessary to enable developing countries to be able to implement their climate change mitigation targets and accelerate the required energy transition away from carbon-intensive power production to renewable energy,” added Tanton, who also reiterated that this announcement coincides with the expected parliamentary tabling of South Africa’s Climate Change Bill this month.

While many details as to the structuring of the funds and exactly how it will be utilised are still to be ironed out, SAWEA notes there are a number of considerations. This includes what is referred to as the ‘Just Energy Transition’ which looks at the effect on people resulting from decommissioning coal-fired power stations, as well as Eskom’s need to upgrade and add new transmission lines and renew its distribution network to accommodate additional green electrons.

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“In a nutshell, we need to remove CO2 from the atmosphere as fast as possible, and at the same time, we need to drastically increase our Energy Availability Factor so that we can bring a halt to the ongoing and crippling loadshedding. The answer to all of this is a renewables-dominated power system, which is also the most cost-competitive system for South Africa,” concluded Tanton.