US Pulls Out of South Africa Energy Deal

By Staff, Agencies

The electrification of South Africa’s informal settlements through a United States Agency for International Development (USAID)-driven Power Africa’s five-year electrification initiative with 24 municipalities - part of an ambitious government plan for universal energy access by 2030 - is among the first projects to be shelved.

This follows the US formally announcing it is cutting its Just Energy Transition (JET) partnerships with South Africa, a decision confirmed to the Presidency last week.

The US has withdrawn from the Just Energy Transition Partnership, a coalition of 10 donor nations assisting developing countries in transitioning from coal to cleaner energy sources.

The JETP, introduced during UN climate talks in Glasgow, aims to support South Africa, Indonesia, Vietnam, and Senegal in transitioning from coal.

The US has confirmed its exit from the Just Energy Transition Project Management Unit (JET-PMU) with South Africa and the International Partners Group (IPG).

Additional sources confirmed the US had withdrawn from the JETP in Indonesia and South Africa, while two foreign officials in Vietnam, according to Reuters, verified the US was pulling out of the JETP there too.

One official indicated the US was exiting all JETP programmes, including those in Indonesia.

The decision will now likely mothball the investment commitments made by the DFC.

Analysts said funding withdrawal may impact South Africa's energy transition momentum.

Even with the US withdrawing, South Africa still committed to a fair energy transition. Other IPG partners stand firm in supporting South Africa’s JET IP.