Coal underpins South Africa’s energy transition
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Coal underpins South Africa’s energy transition
South Africa’s high-quality coal remains essential for energy security and transition.
South African coal, particularly its high-quality, low-sulfur thermal varieties, remains indispensable in the global energy mix. Domestic power generation still relies on coal for around 77 percent of the country’s energy needs, underpinned by reliable infrastructure and a mature mining industry.
Rebounds and geopolitical shifts
Internationally, South African coal exports rebounded in 2024 to over 52 million metric tons, delivered through Richards Bay, with 84 percent heading to Asia, especially India, which imported nearly 26 million tons.
Geopolitical shifts and Europe’s ban on Russian coal briefly increased demand from the EU, but that spike proved temporary. Exports to Europe dropped from around 14 million tons in 2022 to just 3.5 million in 2024, while exports to India surged, reclaiming its status as the top destination.
Market reports note that Exxaro supplied 60 million metric tons by March 2025, illustrating strategic positioning to meet rising Indian demand, driven by its preference for South Africa’s low-sulfur, high-calorific coal.
Integral to South Africa’s domestic economy
Coal is also integral to South Africa’s domestic economy. It supports about 90,000 direct jobs, with many more in indirect roles across Mpumalanga and the greater coal value chain.
Mpumalanga alone contributes about 20 percent of the province’s economy, with a high dependency on coal for livelihoods and local revenue. Should mines and power plants close, unemployment, community destabilisation, and lost infrastructure support would follow – threatening entire towns.
Coal critical in transition
While momentum toward renewables grows, coal offers a proven baseline, supplying consistent, dispatchable power that supports a smoother transition and mitigates blackout risks. It also continues to deliver foreign exchange and supports jobs and communities during the shift to renewables.
Coal remains critical, not only to energy security and export receipts, but to sustaining employment and regional economies. Investors can recognise the dual value: a reliable short-to-mid-term revenue driver, and a societal stabiliser during the broader energy transition.
Image: Coal mines in South Africa continue delivering the goods. Image credit: Leon Louw for WhyAfrica.
Coal underpins South Africa’s energy transition