Latest news with #JETP
Business Insider
10 hours ago
- Business
- Business Insider
Africa's richest country gets €500 million loan from Germany for fossil-fuel move
Germany has approved a €500 million ($582 million) loan to support South Africa's transition away from fossil fuels. Germany has approved a €500 million loan to South Africa for its energy transition. The loan is provided through KfW and GIZ with concessional terms. Germany's financial support under JETP totals €1.3 billion so far. Germany has approved a €500 million ($582 million) loan to support South Africa's transition away from fossil fuels, deepening its financial commitment to the country's decarbonization efforts under the Just Energy Transition Partnership (JETP). The 13-year facility, provided through the German state-owned development bank KfW and implemented by the German Society for International Cooperation (GIZ), includes a three-year grace period and carries a fixed interest rate of 4.31%, the South African National, according to Bloomberg. The loan builds on two prior agreements finalised in 2022 and 2023, bringing Germany's total concessional loan support to South Africa via KfW to €1.3 billion. The funding is part of Germany's pledge under the broader $8.3 billion JETP package launched at COP26, which also includes financial backing from other major donors such as France, the UK, the US, and the EU. The latest round of financing will help bolster South Africa's short- and medium-term energy security while advancing its decarbonization goals, said Finance Minister Enoch Godongwana. South Africa generates approximately 80% of its electricity from coal, making it the most carbon-intensive economy among the G20 nations. The country's ageing coal-fired power fleet has also contributed to chronic electricity shortages, prompting urgent calls for investment in renewable energy infrastructure. Multilateral partners join the push for clean energy In addition to German support, other JETP financiers participating in the latest disbursement include the World Bank, African Development Bank, Japan International Cooperation Agency (JICA), and the OPEC Fund for International Development. In 2023, South Africa received $676 million in grant funding from wealthy nations to support its transition to cleaner energy. However, the government estimates that fully transitioning away from fossil fuels, such as coal, which currently accounts for 80% of the country's electricity generation and a third of its liquid fuel production, will require an estimated investment of 1.5 trillion rand ($78.4 billion).
The South African
11 hours ago
- Business
- The South African
South Africa secures R10.4 billion loan from German bank
South Africa has been granted a €500 million (R10.4 billion) loan for the implementation of the country's Just Energy Transition (JET) plan by the German Cooperation via KFW Development Bank (KFW). ALSO READ | South Africans doubt R7 billion BRICS loan will be used to fix roads This loan is part of South Africa's third Development Policy Operation and participants included the World Bank, African Development Bank, Japan International Cooperation Agency, and the Organisation of the Petroleum Exporting Countries Fund. 'It supports structural reforms to enhance the efficiency, resilience and sustainability of the country's infrastructure services, with a specific focus on the energy sector and climate mitigation. 'KFW's financing forms part of government's broader efforts to implement structural reforms that strengthen public institutions, crowd in private investment, and improve service delivery across priority sectors of the economy,' National Treasury said on Monday. This loan agreement builds on the two policy loans concluded in 2022 and 2023, and forms part of Germany's pledge at COP26 to support South Africa's Just Energy Transition Partnership (JETP). Germany's three policy loans, implemented by KFW, total €1.3 billion and form part of a larger package of JETP projects supported by the German Government via loans, technical assistance and grants. 'The Minister of Finance, Enoch Godongwana, [has] highlighted the significance of South Africa's partnership with Germany and KFW that remains critical to South Africa's development agenda and marks a significant step towards strengthening South Africa's short- and medium-term energy security measures, promoting decarbonisation and enhancing the socio-economic benefits of the energy transition for disadvantaged communities, thereby enabling inclusive economic growth and fostering job creation. 'The Minister also emphasised the need for further policy and institutional reforms in the energy sector to create an enabling environment for the investment required for a just energy transition,' National Treasury said. KFW's Country Director for South Africa, Cornelia Tittmann, said the loan seeks to support the government of South Africa's continued commitment to reforms in the energy sector, which give effect to South Africa's climate commitments and enable the private sector to participate, opening new avenues to strengthen economic cooperation between Germany and South Africa. Let us know by leaving a comment below, or send a WhatsApp to 060 011 021 1 Subscribe to The South African website's newsletters and follow us on WhatsApp, Facebook, X and Bluesky for the latest news.
The Citizen
4 days ago
- Business
- The Citizen
South Africa gets R8.4 billion loan to help fix and improve its energy sector
The money will be used to support the implementation of the Just Energy Transition (JET). South Africa has secured a $474.6 million (approximately R8.4 billion) loan from the African Development Bank (AfDB) to support the country's energy sector transition efforts. The National Treasury stated on Thursday that the money will be used to support the implementation of the Just Energy Transition (JET). JET is a strategic shift towards a low-carbon economy, specifically focusing on reducing reliance on fossil fuels, particularly coal, while ensuring a fair and equitable transition for those affected by the change. ALSO READ: SA's just energy transition: Why investing in gas is a bad idea Second loan with AfDB This is the second loan that the Treasury gets from the AfDB. This first one was concluded in 2023. 'This new agreement highlights the importance of South Africa's partnership with the AfDB in advancing South Africa's development agenda.' Treasury believes that this loan will strengthen efforts to improve energy security measures, accelerate the decarbonisation of the economy, and enhance socio-economic benefits of the energy transition, thereby enabling inclusive economic growth and fostering job creation. Loan is part of third Development Policy 'The loan is part of the third Development Policy Operation which includes participation from the World Bank, KFW Development Bank, Japan International Cooperation Agency, and the Organization of the Petroleum Exporting Countries Fund for International Development (OPEC Fund) to support structural reforms to enhance the efficiency, resilience, and sustainability of the country's infrastructure services,' read the statement. One of the JET's key aspects is transitioning away from fossil fuels, especially coal, towards renewable energy sources such as solar and wind, and exploring other low-carbon technologies. ALSO READ: 'There is hope' for SA's Just Energy Transition despite concerns about funding gap US withdraws from JET Partnership In March, the US withdrew from the Just Energy Transition Partnership (JETP), leaving SA in need of about $1.56 billion (about R28 billion) for its JETP financing. The United States government had pledged $1.56 billion for the country's decarbonisation during the Joe Biden presidency. 'This funding either needs to be found elsewhere or SA's climate change programme will need to be reprioritised,' said Professor Raymond Parsons from the North-West University Business School. NOW READ: SA's R1.5 trillion Just Energy Transition Investment Plan unpacked
Fibre2Fashion
16-07-2025
- Business
- Fibre2Fashion
Vietnam improves regulations to advance energy transition with UK help
With strong UK support through the Just Energy Transition Partnership (JETP) and various bilateral cooperation initiatives, Vietnam is gradually improving its regulatory framework, drawing on international expertise, experience and investment to advance its energy transition towards the goal of net-zero emissions by 2050. At the meetings of the Vietnam-UK Joint Economic and Trade Committee (JETCO) and the UK-Vietnam Free Trade Agreement (UKVFTA) Trade Committee in London recently, Vietnam called on the United Kingdom to step up support in management training, human resource development and building a sustainable renewable energy supply chain. UK businesses expressed strong interest in partnering with Vietnam in renewable energy, a Vietnamese news agency reported. With strong UK support through the Just Energy Transition Partnership and other initiatives, Vietnam is gradually improving its regulatory framework, drawing on international expertise, experience and investment to advance its energy transition towards the goal of net-zero emissions by 2050. UK businesses are keen on partnering with Vietnam in renewable energy. The 14th JETCO meeting discussed and agreed on a wide range of practical areas for cooperation, including agriculture, healthcare, banking and finance, renewable energy, the promotion of bilateral trade and investment, education, and capacity building. The BP Group and Vietnam's T&T Group signed a memorandum of understanding to promote e-mobility through a battery-swapping ecosystem for electric motorbikes. The United Kingdom is Vietnam's third-largest export market in Europe now. Fibre2Fashion News Desk (DS)
Reuters
26-06-2025
- Business
- Reuters
US withdrawal from Indonesia coal phase-down plan to have limited impact, official says
JAKARTA, June 26 (Reuters) - The withdrawal of the United States from an international collaboration to help developing countries move away from coal will have a limited impact on Indonesia, the country's top official for the initiative said on Thursday. The U.S. withdrew from the Just Energy Transition Partnership (JETP) of 10 donor nations this year as part of President Donald Trump's plans to cut foreign aid. Indonesia had been promised $20 billion in funds under the partnership in what was described as the "single largest climate finance transaction" by a U.S. official when the plan was first announced in 2022, but very little money has been disbursed. "The direct impact of U.S. withdrawal from the JETP is not so severe as many people thought," Paul Butarbutar, acting head of the JETP Indonesia Secretariat told the Financial Times Energy Transition Summit Asia conference. The Southeast Asian nation of more than 275 million has repeatedly referenced its low per-capita emissions compared with richer nations, and lack of inexpensive financing to justify reliance on its abundant coal reserves, which have helped provide electricity to its citizens at the lowest prices in the region. Butarbutar said the U.S. had committed $60 million in grants to Indonesia - which will now not be received. However, half of the $2 billion in proposed financial contributions were U.S. guarantees to the World Bank that would have helped Indonesian firms borrow money for energy transition, which have already been finalised. "We still can use the guarantee. So now it is up to us whether we want to use it or not," he said. The rest of the U.S. commitment can be channeled through bilateral cooperation between the two countries, though this funding will no longer be a part of JETP, Butarbutar said. Beyond the guarantee, there could be financing through U.S. interests for select projects, he said, citing an example of the U.S. Development Finance Corp funding a geothermal project involving a U.S. company.
