South African President Cyril Ramaphosa has inked a Heads of Agreement for the launch of a $1 billion green hydrogen fund with Mette Frederiksen, the Danish Prime Minister and Mark Rutte, the Prime Minister of Denmark during their state visit to the country on Monday.
The proposed SA-H2 Fund will raise funds from both the private and public sectors within and outside South Africa to help accelerate the development of the green hydrogen sector through fast tracking infrastructure deployment and workforce build up.
The Fund, backed by Danish, Dutch, and South African investors and government entities including Climate Fund Managers (CFM), Invest International B.V. (II), Sanlam Limited, Development Bank of Southern Africa (DBSA), and Industrial Development Corporation of South Africa (IDC), aims to accelerate South Africa’s climate action, energy sector decarbonization, and promote equitable employment and revenue generation.
“For South Africa, it is important to develop green hydrogen projects that contribute to the export market while developing local economies,” stated President Ramaphosa, adding that “The development of new renewable generation capacity – alongside the recovery of our existing fleet of power stations – is vital for our long-term energy security.”
Andrew Johnstone, CEO of Climate Fund Managers, said: “To achieve Net Zero by 2050, urgent and unprecedented action is needed,” stating that “South Africa combines deep technical and capital markets with world-class conditions for generating renewable electricity through solar and wind power, key drivers in the production of green hydrogen.”
Catherine Koffman, Group Executive: Project Preparation at the DBSA, added that the fund will move South Africa closer to its target of investing $250 billion in green hydrogen by 2050.
The move follows the South African government launching its Hydrogen Strategy in which the country targets to deploy 13 million tons of green hydrogen and derivatives a year by 2050 and has gazetted some 20 projects planned for development to kickstart market expansion in November 2022.
South Africa is also part of the Africa Green Hydrogen Alliance, a continent-wide initiative aimed at boosting knowledge sharing, infrastructure buildup and cooperation between African countries to address market challenges.
