As preparations ramp up for COP29 – the 29th United Nations Climate Change Conference in Baku, Azerbaijan, scheduled for 11th – 22nd November 2024, the focus will be on securing the financial resources necessary to combat climate change. With trillions of dollars needed to drastically reduce greenhouse gas emissions and protect vulnerable communities, this conference represents a pivotal moment for global climate finance. Countries are expected to submit updated national climate action plans under the Paris Agreement by early 2025, making COP29 crucial for enhancing climate ambition.
For South Africa, this international spotlight reveals both challenges and opportunities. Our energy system, historically and currently reliant on coal, accounts for about 73% of the country’s primary energy in 2020 (IEA, 2022). The coal value chain has evolved amidst various political, economic, and social challenges, particularly in the Mpumalanga Province, which generates approximately 84% of the coal sector’s economic output and employs 85% of its workforce. Coal contributes about 20% to Mpumalanga’s economy, significantly impacting local municipalities where it represents 19% to 42% of economic activity. This dominance of coal, suggests that any downturn in production could have extensive repercussions across various sectors, including retail and hospitality. Although coal jobs have declined since the 1980s, transitioning away from coal necessitates careful consideration of its socio-economic implications, particularly in a province where each mine worker typically supports three dependents amid an unemployment rate exceeding 30%.
As COP29 focuses on the financial resources needed for emissions reduction and the scaling of renewable energy, South Africa must navigate its energy transition with sustainability, equity, and financial stability in mind. An abrupt shift away from coal could threaten economic and social stability in communities reliant on coal mining. Therefore, it is vital for our nation to advocate for a balanced and equitable transition, securing the financial mechanisms necessary to support a move toward renewables while ensuring energy security.
To mobilise financing for climate action, South Africa must articulate a clear energy vision. This vision should acknowledge that while renewable energy is essential for achieving climate goals, coal will still play a role in the energy mix in the short to medium term. A just transition requires financial support not only for renewable initiatives, but also for coal-dependent communities, facilitating access to climate finance for the gradual development of renewable infrastructure and job creation in new sectors.
The role of business in this transition is critical. We are committed to advancing cleaner coal technologies while championing a just and equitable transition for South Africa. Our approach recognises the importance of energy security through strategic investments in coal assets, while simultaneously diversifying our energy portfolio as part of our long-term strategy, aligning with global trends and South Africa’s commitment to sustainable development. This balanced strategy, incorporating both coal and renewable energy, enhances South Africa’s energy security while supporting the global climate agenda.
Our diversification strategy resonates with the objectives of COP29, where financial mobilisation will be crucial in transforming climate goals into actionable plans. The conference agenda emphasizes the need for heightened ambition in national climate strategies, supported by a collective quantified goal for climate finance, which is essential for helping countries like South Africa meet their emissions reduction targets.
Team South Africa’s engagement in COP29 presents an opportunity to illustrate how we can balance immediate energy needs with long-term sustainability. It is vital to demonstrate that with the right financial mechanisms and strategic investments, the country can transition responsibly, achieving both environmental and social goals.
The future of energy in South Africa depends on collaboration among businesses, government, and civil society. COP29 offers a crucial platform to establish the partnerships and financial commitments necessary for driving this transformation. As South Africa prepares to update its national climate action plan in 2025, we must ensure that our approach to transitioning away from coal is just and practical. We are dedicated to leading this initiative, balancing coal’s current importance with the urgent demand for cleaner energy solutions. COP29 is not merely a venue for amplifying climate ambition; it is an opportunity to demonstrate how South Africa can convert ambition into action, paving the way for a sustainable, equitable, and resilient energy future.
