New coal plants deepen South Africa’s climate debt for the benefit of transnationals, while leaving South Africa’s poor in the dark.

The Kendal coal-fired power station in Mpumalanga, South Africa. Original image by Darren Smith

This $3.75 billion World Bank loan to Eskom is financing one of the dirtiest coal-fired power plants in the world. The majority of the funds – over $3 billion – is going towards the construction of the 4,800 MW Medupi power plant, which is set to be the world’s fourth largest coal-fired power plant. Medupi will add an estimated 25 million metric tons of CO2 emissions per year to Eskom’s 40 percent share of South Africa’s overall total greenhouse gas emissions.

The project is part of a $50 billion expansion plan by Eskom to increase generation capacity in South Africa. The country – one of the most energy-intensive economies of the world – has been facing an electricity crisis since early 2008 due to demands for power exceeding supply.

The World Bank claims the project will alleviate poverty and increase electricity access to the poor when, in reality, the project largely benefits major industries that consume electricity below cost, while the poor bear a disproportionate responsibility for sharing the costs of the project. At the same time, negative impacts on local communities located near the mines where the coal will be sourced and the plant itself, which is already under construction, are expected to be severe.