### FMC holds workshop in South Africa on supply of zero-emission fuels and technologies 6 May 2024 The First Movers Coalition hosted a workshop in Cape Town, focused on surfacing the supply of zero-emission fuels and clean technologies - with shipping and trucking as key demand sectors. The workshop was part of a series of country specific convenings in key emerging economies on this topic and followed workshops previously held in India (July 2023) and Brazil (October 2023) where other FMC sectors were featured. The workshop in Cape Town gathered 70+ participants representing local and international government agencies, financial institutions, shipping and trucking industry players as well ask key energy suppliers. Participants discussed pathways to bridge the gap between demand and supply for nascent low-carbon fuels and technologies through unveiling opportunities to mobilize finance and create an enabling policy environment.South Africa is a key transport hub for freight via both maritime and road. With a high renewable energy capacity and potential to develop its local green hydrogen economy, the country has an opportunity to decarbonize domestic transport operations and generate revenue through exporting fuels to industry players in foreign markets.“South Africa is a big exporter and has many tailwinds that contribute to a unique position to be a global leader. We need to seize parts of the value chain where there are inherent advantages and opportunities, and this requires a strong demand signal,” says James Walsh, Co-Founder, P2X Partners.The domestic trucking industry contributes to roughly 5% of South Africa’s GDP, with 50% of locally manufactured trucks generating export revenue. With mounting global pressure to decarbonize industry, there is an opportunity for the country to develop a local market for electric vehicles through harnessing its abundant supply of rare earth metals to produce batteries.However, challenges such as high initial costs, limited infrastructure, and concerns about technology maturity hinder widespread uptake of battery electric and hydrogen fuel cell electric vehicles in South Africa. To address these challenges, significant support from the public and private sector will be required.“There is going be a premium on using cleaner technologies. Investing in high-capital vehicles requires flexible financing terms and demonstration that zero emission trucks can be flexible enough for use in multiple operations and not only in a limited range of tasks – customers need to witness vehicles in real operations,” says Eric Parry, Senior Manager, Sustainable Solutions, Volvo Trucks South Africa. Policy incentives will also play a fundamental role in improving grid capacity and supporting infrastructure development. Furthermore, removal of regulatory barriers will go a long way in creating a viable market for zero emission trucks domestically.South Africa’s location between the Atlantic and Indian Oceans also positions the country as an existing bunkering hub already and presents an opportunity to develop a green bunkering hub for international shipping through deployment of green hydrogen and its derivatives.Similar to challenges identified for the trucking industry, infrastructure for bunkering green fuels is lacking at this time with a need for added operational efficiency. Furthermore, the high cost-differential between conventional bunker fuel and low carbon alternatives prevents bankable offtake.“The green premium poses a real challenge and it is unclear who will bear the brunt of the cost along the supply chain. Price equalization for cost of production will lead to scaled supply and bridge the gap with demand, but this will also require a structured approach from industry players as exemplified by concepts like FMC, UNFCCC and the Green Corridor Consortium,” says Andrew Millard, Director, Vuka Marine. Addressing these bottlenecks requires government support for developing port infrastructure and lowering the premium for low carbon fuel options through provision of policy incentives. Additional regulatory action through the International Maritime Organization (IMO) is pending but could potentially create a level playing field through implementation of financing mechanisms that support early-stage projects to reach Final Investment Decision and secure offtake.Finance paints a common thread across both sectors and is a critical component for achieving economies of scale for low-carbon technologies and funding development of supporting infrastructure, particularly in emerging economies faced with disproportionately high interest rates and capital costs.South Africa’s transition thus calls for innovative financing which could take the form of public-private partnerships to pool resources and aid in risk-sharing, streamlined deployment of concessionary capital to match specific needs of early-stage projects, and strategic partnership among private investors to further accelerate project development.“There is no nation that can generate wealth if its infrastructure systems are dysfunctional. South Africa requires a diverse mix of domestic and foreign funding to ensure that government commitments to reduce between 350 and 420 metric tons of carbon dioxide equivalent by 2030 are realised. Furthermore, collaboration and smart partnerships will enable the co-creation of development solutions and enhance the participation of stakeholders in the infrastructure development value chain,” says Zeph Nhleko, Chief Economist, Development Bank of Southern Africa.A key output of the workshop is a white paper similar to those published for India and Brazil (links below). The report will provide a detailed overview of key takeaways from the discussions and is set to be published in early June. ### Decarbonizing Brazil’s Steel, Aluminium and Aviation Sectors Explore the First Movers Coalition's white paper following its in-country workshop in Brazil, focusing on the aluminium and steel sectors. [Explore](https://www.weforum.org/publications/decarbonizing-brazil-s-steel-aluminium-and-aviation-sectors/) ### Surfacing Supply of Near-Zero Emissions Fuels and Materials in India Explore the First Movers Coalition's white paper following its in-country workshop in India, focusing on the aviation, cement and concrete, and steel sectors. [Explore](https://www.weforum.org/publications/surfacing-supply-of-near-zero-emissions-fuels-and-materials-in-india/)