Climate Commission rejects allegations of corruption in energy transition funding

The Presidential Climate Commission (PCC) has poured cold water on a report by advocacy group Open Secrets, which accuses consultancy firms and their intertwined relationships with business interests of systematically looting funds allocated for South Africa's Just Energy Transition (JET).

The report, titled The Climate Consultants; How management consultants cash in on the climate crises, outlines serious allegations regarding the influence of private sector technocrats on government climate policy, while simultaneously consulting for fossil fuel companies implicated in worsening the climate crisis.

The report describes how much of South Africa’s Just Energy Transition (JET) plan is being financed by a $12.8 billion pledge from France, Germany, the United Kingdom and the European Union.

Most of the money so far provided is in the form of concessional loans, which means it still has to be paid back, albeit at favourable rates. The terms and conditions of these loans are not made known.

It claimed that around 65% of the committed grant funds, according to the JET Grants Register, have gone to private corporations and organisations as implementing entities.

Alarmingly, less than 25% of grant capital has been allocated to local public institutions—such as NGOs and universities—highlighting a disconnect between donor intentions and real, local impact.

"More often than not, there is also a direct link between where the money comes from (the donor country) and where the money goes (the implementing entity),” noted the report, led by Open Secrets investigators Zen Mathe, Michael Marchant, Ra’eesa Prather, Luvano Ntuli and Ariella Scher.

It pointed out that three large multinationals known as the Big Three – McKinsey, Bain and Boston Consulting Group (BCG) – and the consulting arms of the Big Four multinational accounting firms – Deloitte, EY, KPMG, and PwC – also continued to do “lucrative work” for fossil fuel companies including Sasol.

The PCC on Wednesday welcomed the release of the report, saying it was part of society’s scrutiny to the country just transition and overall economic reform.

However, the PCC spokesperson, Blessing Manale, said the report "makes no substantiated negative finding against the PCC on any matter even though such are reflected and exaggerated as a smoking gun or nearer to the truth or facts...which we reject."

"By its own admission, the report acknowledges the PCC as the most transparent institutions the investigators interacted with during the sourcing of their information. Its further emphasis that we strongly refuted such allegations with factual verifiable rebuttals," Manale said. 

Manale said the PCC had noted some factual inaccuracies in the report and will make submissions to Open Secrets for a correction of both the digital and hard copies of the report in the interest of fairness and factual reporting.

He said the Commission mobilises and procures expert input research from a wide range of public and private research organisations, including universities, NGOs, and private consultants.

"All advice is thoroughly processed by the Secretariat, carefully considered by the Commission, and cross-referenced with a diversity of stakeholder views before the Commission pronounces its views on any matter," Manale said.

Part of the report's recommendations are that as far as possible, JET Programme monies should be routed through the South African State, spent in compliance with the Public Finance Maagement Act, and allocated for spending through a process of climate-responsive budgeting.

"A key component of this will be regulating private companies in alignment with the Climate  Change Act. Moreover, it remains urgent to introduce effective regulations for themanagement consulting sector," teh report recommended.

"Currently, consultants do not have a regulatory body to hold them accountable for their conduct. Even when consultants are exposed for se-rious misconduct, they remain largely un-accountable for the much larger social costs of their actions."

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