The Presidency has confirmed that it has been formally informed that the US has withdrawn from the Just Energy Transition Partnership (JETP), to which it had initially pledged more than $1.5-billion of grant and commercial funding.

The Just Energy Transition Project Management Unit (JET PMU) indicated that the withdrawal was communicated on February 28 by the US Embassy, citing the executive orders issued by President Donald Trump on January 10 and February 7.

The US was one of the founding members of the initial International Partners Group, or IPG, that launched the JETP with South Africa on the sidelines of the Glasgow COP in 2021.

Together with the EU, France, Germany and the UK, the Americans pledged some $8.9-billion-worth of support for South Africa’s transition from its current coal dominance to an energy system based increasingly on renewable energy.

US pledges in support of the JET Investment Plan (JET-IP), which was subsequently developed by South Africa, comprised $56-million in grant funds and $1-billion in potential commercial investments by the US International Development Finance Corporation.

No concessional loans were offered by the US to South Africa.

South Africa’s JET-IP has since attracted additional international partners, some of which have made pledges as part of the IPG, while others made bilateral commitments.

Besides the original members, the JET-IP is currently also supported by Canada, Denmark, the Netherlands, Spain, and Switzerland, as well as multilateral institutions such as the World Bank and African Development Bank.

With America’s withdrawal, pledges to South Africa have been reduced from $13.8-billion to $12.8-billion.

JET PMU head Joanne Yawitch reported that South Africa was engaging with other grant-making organisations to source alternative funding for JET projects previously designated for support from US grants.

Prior to America’s withdrawal of its $56-million in grants, the total grant funding component for the JET-IP stood at $820-million.

“All other IPG partners remain firmly committed to supporting South Africa’s JET IP,” Yawitch said in a statement, which also reaffirmed South Africa’s own commitment to achieving a just and equitable energy transition.

America’s exit from the IPG is not unexpected in light of the Trump administration’s climate scepticism and its emphasis on accelerating fossil fuel extraction in the US.
 
However, it also comes amid diplomatic tensions with South Africa over the country’s stance with regard to Israel, as well as South Africa’s recently enacted Expropriation Act, which Trump alleges, without evidence, is unfairly targeting land owned by Afrikaans farmers, to whom refugee status has also been offered.
 
These tensions are already influencing the ambition of South Africa in the G20 Energy Transition Work Group, where disagreement has emerged over one of the three priorities set by South Africa relating to “just, affordable and inclusive energy transitions”.
 
Electricity and Energy Minister Dr Kgosientsho Ramokgopa has indicated that South Africa will be seeking to minimise areas of contestation in the interest of ensuring that they do not become an impediment to the eventual signing of a Ministerial Communique.
 
“We will be seeking to stay away from areas that could polarise the conversation and potentially render our presidency ineffective,” Ramokgopa said recently.
 
In addition, it was likely that South Africa would seek to progress talks with the US over the importation of American liquefied natural gas, as a way of transacting its way through the current diplomatic impasse with the superpower.