South Africa is strengthening municipal capacity and mobilising finance to scale energy efficiency investments in public buildings.
Building the foundation for energy efficiency investments
South Africa is advancing energy efficiency in public buildings by strengthening municipal capacity and developing bankable investment projects. Through the Mitigation Action Facility funded Energy Efficiency in Public Buildings and Infrastructure Programme (EEPBIP), public institutions are now better equipped to plan, prepare and implement energy efficiency projects.
Energy efficiency offers significant potential to reduce greenhouse gas emissions and energy costs in South Africa’s public sector. Yet many municipalities lack the technical expertise, institutional systems and financial access required to prepare and implement large-scale projects.
EEPBIP addresses these barriers by combining Technical (TC) and Financial Cooperation (FC) that help mobilise public and private investment A key focus is the development of Energy Performance Contracting (EnPC) models, which enable municipalities to implement energy efficiency improvements with support from private sector energy service companies.
Strengthening municipal capacity
Capacity development has been central to the programme’s approach. To date, nearly 300 public officials – including energy managers, infrastructure officials, finance specialists, monitoring experts, have participated in training and knowledge-sharing activities. These efforts strengthen the ability of municipalities to identify opportunities, develop bankable projects and manage energy efficiency investments.
Improving the policy and financing environment
Technical advisory services have also supported municipalities and public institutions in preparing energy efficiency projects and developing the necessary procurement frameworks. As a result, the programme has built a growing pipeline of projects in South Africa.
EEPBIP has also contributed to improvements in the policy and financing environment for energy efficiency. Amendments to South Africa’s Division of Revenue Act (DORA) now allow municipalities to allocate funding for the preparation and implementation of EnPC projects. These changes help align government funding mechanisms with innovative financing models and enable municipalities to scale up energy efficiency investments.
At the same time, the programme supports the mobilisation of finance through blended funding mechanisms, including a Partial Credit Guarantee designed to reduce risks for lenders and encourage private sector participation.
Early climate impact
Even before large-scale investments are implemented, the programme has already contributed to measurable climate benefits. Through cooperation with South Africa’s Energy Efficiency and Demand Side Management programme, participating municipalities have achieved verified energy savings and emissions reductions.
Energy efficiency improvements include the replacement of inefficient lighting with LEDs, upgrades to heating and cooling systems, and the introduction of energy management systems in public facilities. These measures have already resulted in estimated emissions reductions of more than 4,200 tonnes of CO₂ per year, while also lowering electricity consumption and operating costs.
The programme’s footprint now covers all nine provinces of South Africa, demonstrating growing momentum toward national scaling of energy efficiency initiatives.
Promoting inclusive participation
EEPBIP also promotes gender equality and social inclusion (GESI) in the energy sector. One initiative is the Municipal Women in Energy Efficiency Forum, which supports networking and professional development for women working in municipal energy management.
Training activities also aim to strengthen participation of small and medium-sized energy service companies, including women- and youth-led enterprises.
Lessons for scaling energy efficiency
Experience from the programme highlights several important lessons for scaling energy efficiency investments in the public sector. Strong institutional coordination, clear procurement frameworks and early technical support are essential to prepare bankable projects and attract private investment.
Reliable data systems are also critical for monitoring energy savings and emissions reductions. Efforts are therefore underway to strengthen monitoring and reporting systems across participating institutions.
Looking ahead
In the coming years, the programme will focus on advancing Energy Performance Contracting projects toward procurement and financing stages. Further training, market activation activities and the development of new project pipelines will help scale up energy efficiency investments across the public sector.
By strengthening institutional capacity and improving access to finance, the programme is laying the groundwork for long-term emissions reductions and more efficient public infrastructure in South Africa.
What’s next for Mitigation Action Facility support in South Africa?
To capture lessons from the EEPBIP, the Mitigation Action Facility has published an Evaluation and Learning Factsheet, highlighting key insights on enabling environments, financing models and institutional capacity for scaling energy efficiency in the public sector. Building on the progress of EEPBIP, the Mitigation Action Facility continues to support South Africa’s climate transition through additional initiatives. These include projects focusing on the decarbonisation of the industrial sector, such as South Africa – Steel as well as the Multi-Country initiative Seed Capital Facility (SCAF) III. Together, these programmes aim to accelerate emissions reductions across key sectors while strengthening investment frameworks and institutional capacity.
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