South Africa will need to spend $250 billion over the next three decades closing down its coal-fired power plants and replacing them with green energy, according to a report released on the sidelines of the World Economic Forum said on Thursday.
$125 billion of the total investment, is needed to ramp up wind and solar power projects as the country suspends coal-fired plants that currently supply the bulk of its energy needs, the documents reveal as reported by the Reuters.
The report was produced by academics at South Africa's Stellenbosch University in conjunction with the Blended Finance Taskforce, a body set up in 2017 to help mobilise large-scale private capital in a bid to end poverty in line with the United Nations' Sustainable Development Goals.
In addition to closing down the country’s coal-fired plants and building wind and solar power plants, households that have been affected by the change would also have to be compensated. The Blended Finance Taskforce and the Centre for Sustainability Transitions at Stellenbosch University said.
The report also states that Most of the money will need to come from the private sector, according to the study.
South Africa is the world's 12th biggest emitter of climate-warming gases and the biggest in Africa. In November, the United States, Britain, France, Germany and the European Union agreed to offer an $8.5 billion package to help South Africa accelerate its transition from coal, although exact details and timelines are still being discussed.
"It will take at least $250 billion spent over the next three decades to transition to a low-carbon, more equitable energy system in South Africa under an ambitious decarbonisation scenario (coal off by 2040)," the authors said.