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Billions in Climate Funds Face Uncertain Future in South Africa

Rich nations pledged $8.5 billion to help South Africa cut emissions from coal. There’s a battle over whether funds should go to EVs, hydrogen or the state-owned utility.

Coal delivery trucks outside the Eskom Holdings SOC Ltd. Kendal coal-fired power station in Mpumalanga, South Africa.

Coal delivery trucks outside the Eskom Holdings SOC Ltd. Kendal coal-fired power station in Mpumalanga, South Africa.

Photographer: Waldo Swiegers/Bloomberg
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One of the biggest announcements from last year’s COP26 climate talks was a pledge by some rich countries to provide $8.5 billion to help South Africa transition away from coal. Now different interests within the country are tussling over how that money should be distributed.

Eskom Holdings SOC Ltd., the embattled state-owned utility, is proposing that a substantial portion be used to expand the grid in order to encourage more investment in renewable electricity, according to people familiar with the situation.