South Africa’s Cabinet approves green hydrogen commercialisation strategy

South Africa’s Cabinet approves green hydrogen commercialisation strategy
2nd South Africa Green Hydrogen Summit in Cape Town / Government of South Africa
By Elena Kachkova in Johannesburg October 20, 2023

South Africa’s Cabinet has approved the green hydrogen commercialisation strategy (GHCS) aimed at positioning the country as a major producer and exporter of green hydrogen.

According to the government, the hydrogen economy has the potential to add 3.6% to gross domestic product (GDP) by 2050 and create 370,000 jobs. The draft Green Paper has received extensive feedback from stakeholders, said Minister in the Presidency Khumbudzo Ntshavheni.

The GHCS is framed within the Hydrogen Society Roadmap developed by the Department of Science and Innovation and approved by the Cabinet in 2021. Ntshavheni also said that the government had identified possible funding for green hydrogen projects, without offering any details, Mining Weekly reports.

The GHCS approval follows Heads of Agreements concluded at the second South Africa Green Hydrogen Summit (SAGHS) with the intention of launching a $1bn SA-H2 Fund that will facilitate the development of the country’s green hydrogen sector.

The newly established Ministry in the Presidency for Electricity, led by minister Kgosientsho Ramokgopa, hosted the summit in Cape Town on October 16-17.

The development of a green hydrogen economy is also included in the Just Energy Transition Investment Plan (JET-IP), endorsed last year by the initial members of the International Partnership Group (IPG), writes Mining Weekly.

The IPG, also known as the Just Energy Transition Partnership (JETP), consisting of the European Union, Germany, France, the US and UK, pledged ZAR131bn ($8.5bn) in concessional funding to support South Africa’s phased transition away from coal.

The Netherlands and Denmark have recently become members of the IPG, and other pledges to the JET-IP have also been made by Canada, Spain and Switzerland.

Earlier in October, bne Intellinews reported that the combined pledge from Denmark, the Netherlands and Spain in support of South Africa’s JETP-IP expanded the prospective funding pool from $8.5bn to $11.8bn.

Rudi Dicks, head of the Presidency’s project management office, made this announcement at the 11th quarterly meeting of South Africa’s Presidential Climate Commission (PCC) on September 29.

There are several additional countries who want to come onboard and support South Africa, Dicks said. However, most of the funding would be in the form of loans rather than grants, and the Cabinet said it was concerned about the non-commitment of developed countries to meaningful grant funding.

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