By Faridat Salifu
South Africa’s revised plan to transition away from coal has received a major boost following the approval of a $2.6 billion financing package tied to the World Bank’s Climate Investment Funds (CIF).
On June 11, the CIF’s Clean Technology Fund approved updates to South Africa’s Accelerating Coal Transition (ACT) investment plan, enabling the disbursement of an initial $500 million and clearing the way for an additional $2.1 billion from multilateral institutions including the World Bank and the African Development Bank.
The funding comes after delays last year when South Africa requested a pause in planned coal plant closures due to ongoing power shortages. The amended strategy, which now includes revised timelines, was key to securing renewed donor backing.
Rudi Dicks, head of the Presidency’s project management office, described the approval as a turning point. Speaking at a recent Presidential Climate Commission meeting in Johannesburg, he noted that the decision “opens up a really amazing dynamic” for accelerating project implementation and potentially front-loading climate finance.
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South Africa currently depends on coal for approximately 80% of its electricity and ranks as the most carbon-intensive economy in the G20. The CIF’s support is expected to strengthen the country’s ability to transition to cleaner sources while maintaining energy security.
The decision also salvages a plan that faced considerable uncertainty earlier this year, amid shifting U.S. foreign policy. In March, American representatives had reportedly blocked consensus on the ACT plan following the inauguration of President Donald Trump and his administration’s rollback of international climate funding.
The United States is the largest contributor to the CIF, followed by the United Kingdom, Germany, Japan, and Canada. Under CIF governance rules, any donor country may delay disbursement by requesting additional review. Approval can still be granted if a member abstains rather than formally objecting. The precise details of the June 11 vote have not been disclosed.
The U.S. Treasury, which oversees climate finance commitments, did not respond to recent inquiries. Tensions between Washington and Pretoria have intensified in 2025, with the Trump administration halting aid to South Africa and boycotting recent G20 meetings hosted by the country.
Earlier this year, the U.S. also withdrew support from broader donor partnerships aimed at helping Indonesia, Vietnam, and South Africa move away from coal—costing Pretoria an estimated $1 billion in financing. Trump has also reaffirmed his intention to withdraw the U.S. from the Paris Agreement and reversed a prior $4 billion pledge to the Green Climate Fund.
Despite these setbacks, the CIF decision marks a key milestone in South Africa’s energy transition efforts, with officials now able to submit detailed project proposals for funding approval in the months ahead.
