The South African Just Transition Financing discourse has been dominated by issues of global north and local private sector fund mobilisation and the unlocking of existing funding commitments. More recently, researchers and decision-makers have been thinking about the deployment of such funds (when and if) they begin to flow. Just transition fund deployment will require decision-making about capital allocation to projects. In order to achieve this, decision-makers will need to have a method by which to test what will constitute a Just Transition Transaction and how to rank just transition transactions against each other..
TIPS has developed a Framework to provide guidance and direction on: i) what could count as a just transition investment? ii) how to compare and contrast just transition investments, and iii) what would need to be measured to ensure investments deliver just outcomes and impacts.
The TIPS Framework is based on an iterative methodology. It marries top down theoretical research and learning with bottom up project-level experience and information. The interplay between theoretical knowledge and on-the-ground experiential information will support the development of a just transition definition that is practical and material to specific investments, while also being appropriate to South Africa’s unique historic and socio-economic context. The iterative methodology supports the principle of co-creation between framework developers and framework users as a means to support increased uptake of future iterations of the framework.
The methodology begins with the development, publication and socialisation of a draft framework. Investors and investees of projects which share some or all of the elements contained in the framework will be approached (and volunteer) to complete a standardised informaion template. Completed templates will be used to test the sensitivity and usefulness of the framework’s pre-screening, evaluation and designations. If all projects submitted end up being included as just transition or just transition plus projects then it is likely the framework bar is set too low. If all projects are excluded the bar is likely too high. If projects are unable to be assessed it is possible that the parameters of the framework require reconsideration. Based on this analysis the framework will be revised, and the revised version published and socialised. Funding permitting, the process should run every two or three years.
Report With Annexures (read online): Just Transition Transaction Framework: A Framework for Financing Investments in a Just Transition
This report has been made possible by the support of the African Climate Foundation and the European Climate Foundation.
Launch: Just Transition Transaction Framework: A First Iteration
Presentation
A Framework For Financing Investments in A Just Transition - Sandy Lowit, TIPS Research Fellow
Media
TIPS sets out to create a South Africa-focused Just Transition Transaction Framework - Engineering News 21 August 2023