Germany has increased its financial commitment to South Africa’s Just Energy Transition Partnership (JETP) to €2.68 billion, up from €986 million pledged in 2021, reaffirming European support for the country’s shift from coal to low-carbon energy.
The announcement comes as the United States withdrew from the partnership in 2025, leaving European partners to sustain momentum for South Africa’s energy transition. According to Rainer Baake, Germany’s special envoy for the JETP, over €1.4 billion has already been disbursed under a program set to run through 2027, financing grants and concessional loans for renewable energy projects.
“The increased envelope responds to strong demand for funding under the investment plan developed by South African authorities,” Baake told Engineering News during a recent visit to Pretoria. He said renewable energy projects were a key focus, reflecting growing private-sector interest as the country seeks to open its electricity sector to competition.
Germany’s expanded support forms part of a broader European commitment. On Jan. 22, the United Kingdom announced an extension of its US$1 billion climate guarantee for South Africa, aimed in part at municipal electricity reforms. European partners had already reaffirmed support in 2025 following Washington’s withdrawal from the JETP, emphasizing the bloc’s strategic role in advancing South Africa’s low-carbon transition.
The JETP is designed to assist South Africa in gradually reducing its reliance on coal, expand renewable energy capacity, and accelerate the shift toward a low-emissions economy. Despite growth in solar and wind generation, coal remains the dominant source of electricity. Authorities note that improvements in grid stability since 2025 have largely depended on better performance from existing coal-fired plants, highlighting the challenge of a rapid transition away from fossil fuels.
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South Africa’s energy sector faces a dual challenge: decarbonising generation while maintaining reliable supply. Municipal electricity services have historically struggled with inefficiencies and infrastructure constraints, prompting the need for international financing, technical support, and private-sector participation.
The partnership has prioritized renewable generation, grid reinforcement, and energy efficiency initiatives, while concessional financing supports early-stage project development and risk mitigation. German and European funding is expected to unlock additional private investment, facilitating projects that might otherwise struggle to secure commercial financing.
Officials said the funding increase underscores Europe’s long-term commitment to supporting South Africa’s energy and climate objectives. Baake described the JETP as “a critical mechanism to foster a sustainable energy transition while ensuring that economic development and employment goals are aligned with environmental priorities.”
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The South African government welcomed Germany’s increased commitment, noting that international support remains essential to meet ambitious climate targets, reduce carbon emissions, and maintain energy security during the transition period.
While challenges remain, including ongoing dependence on coal and the need to strengthen institutional capacity, analysts said European-led initiatives like the JETP provide a roadmap for scaling renewable energy and mobilizing capital, even in the absence of U.S. participation.
The partnership highlights how multilateral collaboration can help emerging economies balance climate commitments with energy access and economic growth. Germany’s enhanced contribution to South Africa’s JETP marks a renewed vote of confidence in the country’s capacity to navigate a low-carbon transition while sustaining critical power supplies.
