JET funding fuels concerns

In the two-plus years since South Africa’s world-famous Just Energy Transition Partnership (JETP) was announced at COP26, there has been considerable public speculation on its status, and broad interest in how the funding would be structured and deployed. Tidbits of information have been eagerly consumed, and it is generally assumed that progress is slow because of antagonism from powerful political opponents.

But a document uploaded to the state of the nation website, titled “JET IP (JET Implementation Plan) Grant Mapping Register”, suggests that we were all dopes from the start. Billions of rand of JETP funds have already been spent, allocated or “pledged”, much of it even before an investment plan was released.

The grant register was referred to in the JET IP approved by cabinet in November 2023. Though it appears to have been publicly available since then, the register was picked up by media (News24) only in February. It shows that since November 2021, R10bn (about $591m) has been allocated to 145 projects.

By the time the JET Investment Plan was unveiled by President Cyril Ramaphosa on November 4 2022, 89 of the 145 projects, worth more than R5.3bn, had already commenced. The end dates for 26 of them were before cabinet formally approved the JET IP in November 2023.

$8.5bn is a lot of money to spend in five years (now more than $11bn, with more countries pledging funds), and you may think it would be crazy to wait for sloth-like government departments to approve an investment and implementation plan. But a lack of transparency around the JETP threatens to quickly erode public trust in the entire project.

While there may indeed be worthy recipients of the funding allocated so far, the register raises two crucial initial questions. First, how are the recipients selected? Second, what criteria are used to assess whether a project will contribute to the JET?

On the first point: the JET Project Management Unit, which “sits within” the presidency, doesn’t have a website. It is hard to discern who works there and impossible to know how they were appointed. There is no public application process for JETP funding, and no public information about how recipients have been identified and selected, nor what their accountability mechanisms are.

While the JET IP states that a JET Funding Platform will be established in 2024 as a “matchmaking mechanism” between funders and potential beneficiaries, seriously large amounts have already been disbursed to an array of “implementing entities”. For example: R130m to “South African Universities”; R115m to consultants Deloitte; R60m to the National Business Initiative; R56m to Green Cape; R42m to the Council for Scientific & Industrial Research; and R30m to consultancy PwC.

What’s staggering is that there has been no transparency around recipient and project selection. This raises the question whether only entities with the right connections have been able to access funding.

The question about criteria is much more difficult. While the JET IP identifies key focus areas for the use of grant funding, it is hard to understand, without transparency around selection, how and when this myriad diverse, disconnected projects will converge in achieving accelerated decarbonisation and justice for affected communities.

This is particularly concerning when looking at funds deployed to recipients in the private sector, such as an American event management firm, which received R16.6m to organise green hydrogen industry workshops, or the R626m for green fuel projects where Sasol is a joint implementing partner.

There is also an allocation of R35m to municipal support projects, which includes reference to the Musina-Makhado Special Economic Zone, a Chinese-backed, coal-fuelled mega-industrial project described by environmental justice groups as “Limpopo’s climate bomb”.

Public trust

The JETP has been sold as a world-first initiative prioritising justice and catalysing economic transformation. It is of the utmost public interest, and process transparency and oversight should have been the first and most obvious priority for those implementing it; even more so in a country indelibly scarred by the devastation of corruption and endless broken promises.

The eye-watering R10bn deployed is, in fact, only a fraction of the total JETP funds pledged so far, and there is time to regain credibility. As a start, the PMU, donors, and project recipients must prioritise the public availability of information relating to past selection processes and the outcomes of completed projects. No new grants should be allocated until this has been done, and until the funding platform is operational.

Most importantly, there must be regular public feedback on how projects are tangibly benefiting the workers and communities in whose name the JETP has been promoted. Without that, it will lose all legitimacy and be viewed by millions of disillusioned citizens as yet another mechanism for enriching consultants and the well-connected.

This article was first published in the Financial Mail on 15 February 2024.

By: Tracey Davies

IMAGE: 123RF / dzmitryskazau

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