NATIONAL NEWS - Trade, Industry and Competition Minister Parks Tau says green hydrogen will play an important role in South Africa’s efforts to build a more competitive, value-driven industrial economy.
Tau was speaking at the Africa Green Hydrogen Summit in Cape Town on Tuesday, 15 September, where he outlined government’s plans to use emerging green industries to support economic growth and create new opportunities for investment and employment.
Moving beyond raw resource exports
Tau said green hydrogen forms part of a broader industrialisation strategy that includes sustainable aviation fuel, green chemicals, green shipping fuels, advanced manufacturing and new export industries.
“These are the opportunities that matter. These are the industries that will determine South Africa's competitiveness in the decades ahead,” he said.
The Minister said South Africa needed to move further up the value chain rather than relying primarily on the export of raw resources.
“Our ambition is clear. We must export more value and less raw potential. We must move up the value chain. We must become producers, not merely providers of resources,” Tau said.
Funding projects and infrastructure
Government is already supporting a pipeline of green hydrogen-related projects.
Through the Just Energy Transition Investment Plan (JET-IP) programme management office at the Industrial Development Corporation, 24 strategic integrated projects have been identified, with several having progressed to the pre-feasibility stage.
The projects are backed by €40 million from Germany’s KfW Development Bank.
Tau also highlighted developments in the South Africa Green Hydrogen Fund. In August, Climate Fund Managers closed the first R3 billion of the fund, supported by the European Commission through its Global Gateway commitment with the European Union.
A further R628 million in grants has also been made available.
Of this amount, R490 million will support hydrogen infrastructure investment and is expected to leverage a further R10 billion, while R138 million will assist Transnet with greening its operations.
Green hydrogen could create jobs
The Minister said South Africa’s industrial transition pathways could generate tens of thousands of additional jobs and billions of rand in economic activity in the years ahead.
He also stressed that the development of a green hydrogen economy should not be viewed as a single-country opportunity.
“Through platforms such as the Africa Green Hydrogen Alliance, we are strengthening cooperation across the continent, because no single African country will build this economy alone,” Tau said.
He added that greater regional cooperation could give Africa the scale needed to compete internationally.
Coega project gets government backing
One of the projects highlighted by Tau is the Coega Green Ammonia Project, which is being developed by Hive Hydrogen.
Through the Critical Infrastructure Programme Fund, the Department of Trade, Industry and Competition is supporting the project, which Tau described as South Africa’s lighthouse green hydrogen project.
The project is expected to contribute to economic development in the region while supporting South Africa’s wider industrial transition.
Tau said Hive Hydrogen has completed financial due diligence, unlocking R12.5 million of R25 million in project development funding, with a further R25 million funding application to be submitted at financial close.
“This funding announcement today is particularly significant as it practically puts in motion the Decarbonisation pillar of our Industrial Development Strategy,” he said.
Building a new industrial economy
South Africa’s green hydrogen ambitions form part of a wider effort to attract investment into industries that can support exports, infrastructure development and employment while reducing carbon emissions.
For government, the challenge now is to turn the country's renewable-energy potential and industrial capabilities into higher-value products and globally competitive industries.
As Tau put it, the goal is to ensure South Africa becomes a producer of future-focused products rather than simply a supplier of raw materials. – SAnews.gov.za
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