Supporting South Africa’s energy transition

Project description

Title: South African-German Energy Programme – Capacities for the Energy Transition (SAGEN-CET)
Commissioned by: Bundesministerium für wirtschaftliche Zusammenarbeit und Entwicklung (BMZ)​​​​​​​
Country: South Africa​​​​​​​
Lead executing agency: Department of Mineral Resources and Energy (DMRE)​​​​​​​
Overall term​​​​​​​: 2019 to 2023

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Context

South Africa is facing far-reaching changes in the energy sector. Due to the aging power plant fleet, old coal-fired power plants with an installed capacity of approximately 11 gigawatts (GW) will be decommissioned by 2030. This will result in a significant need for new generation capacity, which will largely be provided from renewable energies.

By 2030 alone, an additional 24 GW of solar and wind capacity are to be installed. In addition, South Africa is facing a power sector reform that will fundamentally change the structures of the power sector and the roles of the actors involved. The vertically integrated state-owned utility Eskom will be unbundled, envisaging a transition process towards a competitive market. The changing frameworks present a good starting point for the development of a green hydrogen economy in the country.

Objective

The methodological, personnel and technological capabilities of national and municipal actors in the power sector for the implementation of the energy transition are improved.

Approach

The project works under the South African-German Energy Programme (SAGEN) and collaborates with South African partners to support a just energy transition in South Africa. The Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) implements SAGEN-CET in cooperation with the Department of Mineral Resources and Energy (DMRE), the National Treasury (NT), Eskom and the South African Local Government Association (SALGA).

The programme provides international know-how for policy makers and utilities on the future power market design and energy transition. Among other things, the focus lies on promoting regulation to enable viable and resilient (distribution) utilities, on managing the structural, socio-economic challenges in the energy sector or supporting the framework conditions for a green hydrogen economy in South Africa.

In close collaboration with South African universities and skills development institutions, the programme supports the development of competences amongst sector experts and executives to shape and implement the transition. Furthermore, the programme promotes the piloting of technology innovations.

Last update: June 2022

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