Unmanned shutdown of South African coal plant could wipe $550 million off country's GDP

The potential shutdown of South Africa's largest coal-to-liquids plant, Secuda, could result in a $550 million loss to the nation's $400 billion economy, according to researchers at the University of Cape Town. The facility, which accounts for nearly a third of the country's domestic fuel supply, is the world's biggest single-site greenhouse gas emitter and is a critical component of South Africa's economy and environment.

Despite neither the government nor Sasol having plans to close Secuda, the modeling by UCT researchers comes as the company faces shareholder pressure and banks reducing funding for high-carbon assets. In response to rising climate concerns, Sasol announced in 2022 that it would cut its planned budget for emissions reductions, saving up to $1 billion through various trade-offs, with the goal of achieving a 30% reduction in greenhouse gas emissions by 2030.

South Africa, the continent's biggest polluter, relies heavily on coal for about 80% of its power, leaving its industrial heartland vulnerable to global climate pressure.