The European Union (EU) is to invest €4.4bn in South Africa’s clean energy industry as part of a global gateway investment package.
South Africa becomes the first country to sign such an agreement with Europe. It will focus on investment, the clean energy transition, skills, technology, and developing strategic industries along the entire supply chains. The energy funding would come from European financial institutions. The overall package totals €4.7bn which includes €303m in EU grants.
European Commission President Ursula von der Leyen said it has started negotiations on the first Clean Trade and Investment Partnership. Trade between South Africa and EU totals €50bn today.
“Take the clean hydrogen value chain,” she said. “South Africa has everything to become a global leader: You have clean energy in abundance, from wind to sun. You have raw materials that are critical for electrolysers, including 91% of the world’s platinum group metal reserves. And you have a rising industry to produce clean hydrogen and strong export ambitions.
“Together with private companies, we can unleash investments in clean energy, raw materials and green hydrogen. We can boost local industry with agreements for the future production that gives them certainty. And we can facilitate the trade of made-in-South Africa products to Europe.”
A fact sheet on the EU–South Africa investment package states that the focus on green hydrogen would involve establishing financing facilities to leverage public and private sector investments and providing technical assistance for hydrogen projects.
As part of a Just Energy Transition Partnership, sustainable value chains will need to be developed to support critical raw materials for green energy and future industries.
The investment follows the “Scaling up renewables in Africa” campaign which was launched last November.
