The infrastructure chief of the presidency says rich nations have an obligation to fund South Africa’s development of green hydrogen as part of the global effort to decarbonise.<\/p>\n
As reported by Bloomberg, the chief of infrastructure, Kgosientsho Ramokgopa, said at a recent energy conference that: “The developed world has a moral and ethical responsibility to help fund the adoption of green hydrogen.”<\/p>\n
Ramokgopa’s comments add to the debate over who should pay the bulk of costs to decarbonise when Africa accounts for less than 3% of the world’s energy-related carbon dioxide emissions, Bloomberg reported.<\/p>\n
So far, South Africa has been budgeted up to R300 million to research the green hydrogen industry, with input from Germany and Japan. The country also plans to attract roughly $250 billion for green hydrogen.<\/p>\n
Green hydrogen is a type of alternative fuel that is produced by extracting hydrogen from water through electrolysis. The process is powered entirely by renewable energy sources such as wind, solar or a combination of both.<\/p>\n
South Africa and other Sub-Saharan countries are major producers of minerals used in hydrogen production, including platinum group metals and iridium.<\/p>\n
Green hydrogen has been hailed as a highly profitable industry for South Africa domestically through the export of hydrogen.<\/p>\n
Precedence Research predicts that the market for green hydrogen will grow at a CAGR of 54% from 2021 to 2030, and it is expected to reach $89 billion globally by 2030.<\/p>\n
The push toward green hydrogen forms part of the Just Transition Framework, a country-wide initiative to move away from fossil fuels.<\/p>\n
Despite the promising financial opportunities of green hydrogen, President Cyril Ramaphosa has said that the country will still need $98 billion over the next five years to enable the shift.<\/p>\n
Wealthy countries have already pledged large quantities of money towards governments’ plans to decarbonise by 2050. The presidency’s Just Energy Transition Partnership includes the US, UK, Germany, France and the EU.<\/p>\n
In the latter part of 2022, the cabinet authorised an $8.5 billion strategy to transition from coal. The strategy involves utilising foreign climate funding pledged by wealthy nations to shut down and repurpose coal-fired power plants in South Africa.<\/p>\n
However, the funds from the rich nations have raised concern as most of them are in the form of concessional loans and grants – that will only be provided if certain terms and conditions are met.<\/p>\n
To add fuel to the fire, recent allegations made by the former Eskom CEO Andre De Ruyter pointed to corruption interfering with the $8.5 billion deal, which may put the rich nations’ money at risk when it arrives on South African shores.<\/p>\n
The CEO of Business Leadership South Africa (BLSA) said that the allegations could spook the wealthy nations involved in the deal.<\/p>\n
“Although unproven, De Ruyter’s allegations are serious. BLSA hopes that the JET-IP (Just Energy Transition Partnership) package is not now at risk, with the countries that are funding it already concerned about South Africa’s international positioning.<\/p>\n
“The US House of Representatives, as an example, is considering a resolution filed by Republicans last week asking the Biden administration for a thorough review of the current and future status of the United States-South Africa bilateral relationship’,” Mavuso said.<\/p>\n