• Public support for fossil fuels in South Africa has risen to nearly 110 billion rand ($6 billion) in 2025, triple its 2018 level.
• Most of the increase stems from repeated financial bailouts of Eskom, the state power utility.
• Renewable energy subsidies account for less than 5% of fossil fuel support, despite official climate pledges.

Public subsidies for fossil fuels in South Africa have tripled since 2018, according to The Energy Tab, a report published in December 2025 by the International Institute for Sustainable Development (IISD).

The report estimates that fossil fuel subsidies reached nearly 110 billion rand ($6 billion) in 2025, up from 37 billion rand ($2.8 billion) in 2018. The figures are expressed in real terms, adjusted for inflation.

The estimates include direct budget transfers, tax breaks, and public guarantees covering support mechanisms benefiting the coal, oil, and gas sectors.

The IISD identifies financial support for Eskom as the largest component of these subsidies. The state-owned utility, which generates most of its electricity from coal, has received repeated government bailouts in recent years. According to the report, these interventions account for most of the increase in fossil fuel support.

Since 2019, several financial measures have been approved to ensure electricity supply continuity and stabilize Eskom’s financial position.

The report also factors in exemptions under South Africa’s carbon tax, introduced in 2019. Several energy-intensive industries benefit from partial rebates, effectively lowering the cost of the tax for those companies.

Between Fossil Support and Climate Goals

At the same time, the IISD notes that subsidies identified in support of renewable energy accounted for less than 5% of the amount directed toward fossil fuels in 2024.

This assessment comes as South Africa has formalized its international climate commitments. The country submitted its nationally determined contribution under the 2015 Paris Agreement, setting official targets for reducing greenhouse gas emissions.

Recent policy decisions have further clarified the country’s energy pathway. The government approved the Integrated Resource Plan 2025 (IRP 2025), according to an October 2025 briefing note from the U.S. Department of Commerce. The plan calls for adding about 11,270 megawatts of solar photovoltaic capacity and 7,340 megawatts of wind power by 2030, along with new storage facilities and gas-fired generation capacity.

In addition, reporting in April 2024 cited South African authorities as saying the Renewable Energy Master Plan aims to install up to 5 gigawatts of new renewable capacity annually by the end of the decade.

On the institutional front, the government has completed the first phase of consultations on sectoral emissions targets, according to an official communication released by SAnews in 2024. These targets are intended to guide how different sectors, including energy, contribute to national emissions reductions.

Abdel-Latif Boureima