South Africa's state utility Eskom seeks $10B to shift to renewables

South Africa's state utility Eskom seeks $10B to shift to renewables

South African public power utility, Eskom, has reportedly put forth a plan valued $10 billion in front of the global lenders. As a part of this plan, the largest greenhouse gas emitter in Africa, would shut most of its coal-fired plants by 2050 and shift to renewable energy.

A senior official at Eskom has confirmed that the discussions about the plan have already began with development finance institutions like the African Development Bank and the World Bank.

Mandy Rambharos, General Manager at Just Energy Transition office of Eskom, stated that the company is planning to make a hefty investment. With this the company wants to suggest the funders that South Africa can serve as a largest point source of carbon emissions reduction across the world.

It has been reported that Eskom, which produces over 90% of South Africa’s electricity largely by coal combustion, is expecting nearly $7 to $8 for every ton of CO2 equivalent it alleviates from its emissions. At present, Eskom emits about 213 million tons of CO2 equivalent every year.

Reportedly, the idea is to allocate some of the funds prior to the COP26 climate conference in Glasgow scheduled in November. The company is already planning to repower its Komati coal plant through solar and battery storage and is likely to present the project at the conference to show its serious efforts to curb emissions.

Rambharos mentioned that the utility has been modelling various scenarios to attain its net zero emissions target by 2050.

Apparently, the least aggressive way is the one laid by the government in a 2019 document known as the Integrated Resource Plan, which expected the utility to shut nearly 35,000 megawatts of coal by 2050.

A bolder move is likely to see the closure of the two large coal plants- Kusile and Medupi plants in the 2040s itself. This will be at least 20 years before the schedule and will leave Eskom with no coal by 2050 from 15 stations.

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