South Africa’s Eskom will cut coal capacity and boost renewables by 2040

The South African state-owned power utility Eskom plans to transition primarily to clean energy sources by 2040, moving away from its current predominantly coal-based generation fleet, as outlined in its latest strategy. Eskom aims to increase its renewable energy capacity to 32 GW by 2040, up from less than 1 GW currently, while reducing its coal-fired power capacity from 39 GW to 18 GW over the same period. Eskom also announced plans to implement renewable energy projects by repowering older coal-fired stations slated for closure, as well as through new developments. The company confirmed that 5 GW of repowering projects are currently underway at six coal-fired power plants, with construction on 2 GW scheduled to begin by 2026.

Eskom cited a heavy debt burden of approximately ZAR400bn (US$22bn), rising unpaid debts from municipalities, and uncertainty over regulated power tariffs, which it says are set below the levels needed to cover its costs, as key challenges to its clean energy ambitions.

As of 2024, South Africa’s installed capacity stands at around 63 GW, with solar and wind accounting for approximately 11% and 5%, respectively. The country targets installing 4.5 GW of wind and 3.7 GW of solar capacity by 2030.