The Netherlands will form a $1bn green hydrogen fund with South Africa to invest in the country’s projects.

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The cash was promised during a recent state visit to South Africa by Dutch prime minister Mark Rutte and Danish leader Mette Frederiksen.

“From the Netherlands, we welcome the commitment of $1bn for the establishment of SA-H2 Fund to mobilise green hydrogen investments,” said South African president Cyril Ramaphosa today (Tuesday), adding that he is “encouraged by the enthusiasm and interest shown by the Netherlands and Denmark to work with South Africa in developing a green hydrogen economy”.

The Development Bank of South Africa and Industrial Development Corporation of South Africa, as well as local financial services firm Sanlam and Dutch impact investor Climate Fund Managers, are also expected to contribute to the fund, according to news agency Bloomberg.

Some earlier reports had suggested that Denmark was also in the frame to make a contribution to the $1bn green hydrogen fund, but so far the Danish government has not responded to Hydrogen Insight's request for confirmation.

South Africa’s government is exploring green hydrogen as a potential new area for investment while it shifts its economy away from its current dependence on coal, with a target of 10GW electrolyser capacity by 2030.

The Netherlands and Denmark are also reportedly due to join the Just Energy Transition Partnership set up in 2021 by the US, UK, France, Germany, and the EU, which commits an initial $8.5bn toward South Africa’s coal phaseout.

Yesterday, the Danish and Dutch prime ministers Mette Frederiksen and Mark Rutte jointly visited South African’s neighbour Namibia, which Rutte described on Twitter as an effort to “step up our cooperation on green hydrogen”, although no new binding agreements were signed.

Last month, Namibia signed an agreement with independent producer Hyphen Hydrogen Energy to develop a $10bn, 3GW green hydrogen and ammonia complex in the country.

Hydrogen Insight has reached out to the South African, Dutch and Danish governments for more detail on the planned fund.

UPDATED: to establish that the Netherlands is so far the only confirmed international contributor to the fund