Let’s get more job-intensive, less carbon-intensive

Published on Fin24 on Oct 02 2018 20:15, written by Louise Naude.

Growth in South Africa’s GDP has stalled, yet significant opportunities to drive a deep and sustainable economic turnaround could be missed if we don’t pay attention.

Initiatives spearheaded by the Presidency, including the Jobs Summit this week, the Investment Summit later in the year, and the recently announced stimulus package are an opportunity to re-orientate the economy to deliver reduced inequality, create jobs and livelihoods, and advance industrialisation, while dealing with the geophysical and socio-economic implications of climate change.

The era of policy making with a blind spot around climate change must be brought to a close. We don’t have the money or time to waste on perversely locking the economy further into a carbon-intensive and climate-vulnerable path.

The Jobs Summit takes place on the eve of the release of the Intergovernmental Panel on Climate Change’s Special Report on Global Warming of 1.5 °Celsius on 8 October. Economic modelling in a publicly leaked draft of the full IPCC Special Report shows that the dangers for economic growth, particularly in developing countries, are significantly greater at average global warming of 2°C than at 1.5 °C.

If the greenhouse gas emissions produced by human activity continue on the current trajectory, warming is set to exceed 3°C, by far surpassing the abovementioned 1.5 °C by about 2040. Yet, if we act swiftly and together to make far-reaching changes to be globally carbon neutral by 2050, we can still keep warming below 1.5 °C.

The longer we take, the harder it will be, and the worse and more irreversible the implications.

South Africa will increasingly face trade impacts due to reduced demand for, and trade barriers against, our high-carbon and carbon-intensive exports, such as thermal coal, locally produced iron and steel, and combustion-engine vehicles. Already, the European Union requires a binding reference to the United Nations Paris Agreement in its trade deals.

Redirecting fossil fuel subsidies is an obvious way to start stimulating the emergence of a low-carbon economy and provide for social protection of affected workers. In the liquid fuels sector alone, South Africa’s fiscus hands fossil fuel producers between R6.4bn and R28bn per year, and forgoes between R35m and R4.7bn revenue through indirect subsidies.

This excludes the price support received by Sasol via the regulated fuel price. That’s the President’s stimulus package pretty much funded right there, without having to take monies from education, health, social grants and the like.

Cutting coal is central to a climate solution in the country and globally, and re-skilling and re-deploying workers in high carbon-emitting sectors is critical. We should guard against a new economic path being shaped by the perspectives of carbon-causing companies serving their special interests behind a smokescreen of overnight job losses.

An article published on Fin24 reports that South Africa’s Standard Bank and multinational Standard Chartered Bank have adopted policies to stop funding any new coal-fired power plants. Lower investment risk is starting to swing away from carbon-intensive to lower carbon, and a tipping point will leave the country and investors with stranded fossil fuel assets and business models, and accelerating job losses.

Both the science and economic trends are clear that climate action is urgent. All government programmes and expenditure, including the President’s stimulus package, should pull in a low-carbon direction, and private investors and lenders would be well advised to do so too.

Not to do so is perverse, shoring up economic and business models that undermine development.

The required profound decoupling of development from fossil fuels and other causes of emissions opens up the opportunity to address other deep-seated systemic features of South Africa’s economy. However, there is no guarantee that a transition to a low-carbon economy will do so unless explicitly managed by a developmental state, and driven by businesses and labour with foresight. WWF advocates a Just Transition Taskforce spearheaded by the Presidency, and housed within The National Economic Development and Labour Council (Nedlac).

The flip side of a necessary winding down of the role of fossil fuels in our economy will be the opportunities to be found in a low-carbon economy, which is where the greatest potential for economic development and exponential returns on investment off a low base lie. Decisive and swift action in this direction can create a competitive advantage for South African businesses ahead of the pack.

Here are a few ideas:

•  Focus on the growing market for metals and minerals necessary for manufacturing ‘clean’ technologies.

•  Beneficiate minerals used to make electric and hybrid vehicles, and localise the assembly and manufacturing of these vehicles.

•  Localise production of water treatment and water conservation technologies.

•  Re-use industrial and household waste as inputs for manufacturing. (Moves to formalise waste economies must involve informal waste workers.)

•  Adopt climate-smart agricultural crops and practices which conserve soil carbon and reduce water use, to expand food security and rural livelihoods.

Certainly, cutting coal is central to a climate solution in the country and globally, and fortifying workers in high carbon-emitting sectors, is critical. A Nedlac task team on the carbon tax is focusing on plans for the workforce and businesses in exposed sectors.

We should guard against a new economic path being shaped by the perspectives of carbon-causing companies serving their special interests behind a smokescreen of overnight job losses.

But a fixation on a fossil fallout means we are not facing forward to greenfield job creation and intensification, and risk keeping the economy stuck in the doldrums as the world passes us by.

The workforce must be skilled in anticipation of participation, job creation must be decent, women’s under-employment can be addressed, job-intensive business models need to be pursued. The Jobs Summit needs to build climate considerations into all job creation and investment initiatives. The Summit’s agenda is to align efforts of every sector and every stakeholder behind the imperative of job creation – let that be climate-smart job creation within a just transition.

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Carbon Tax in South Africa – Not much time left to prepare …

Written by Silvana Claassen, Senior Carbon Advisor at Climate Neutral Group

National Treasury presented an update on the status of South Africa’s proposed carbon tax on 13 September during public hearings held by the Standing Committee on Finance. Since the release of the Draft Carbon Tax Bill in December last year, stakeholder comments have been collated and considered whilst final amendments to the proposed Bill are being incorporated. The Bill is now ready to be tabled and enactment is anticipated early 2019. It may be that the projected implementation date of 1 January 2019 is not feasible and might be postponed with a few months (given South Africa’s NDC commitments).

The NDC (Nationally Determined Contribution) is a key document outlining South Africa’s minimal commitments to the international community in terms of its contribution to the global effort to prevent greenhouse gas concentrations in the atmosphere exceeding levels that would cause irreversible and unsustainable impacts to the planet. The NDC is based on a number of elements: greenhouse gas emissions reduction targets; an emissions reduction trajectory; time frames; and a policy framework.

Historically, South Africa’s emission reduction trajectory has been relative to a business as usual scenario. But through the NDC, South Africa has moved away from this and adopted an absolute target framework, in accordance with a so-called Peak Plateau Decline (PPD) trajectory. “The time-frames within the PPD trajectory range are 2025 and 2030, in which emissions will be in a range between 398 and 614 MtCO2e” (South Africa’s NDC). To put in perspective: in 2016, South Africa’s annual emissions were 468 MtCO2e (Global Carbon Atlas).

The NDC presents a mix of measures to be deployed in order to achieve the stated pledges. Among the mix of measures there is the carbon tax, carbon budgets, the obligation for emitters to submit emission reduction plans and strategies, as well as mandatory reporting of annual greenhouse gases by companies exceeding pre-defined emissions thresholds. A number of these measures have already been promulgated and have allowed for government to gain thorough insight in South Africa’s sources of greenhouse gas emissions. In turn this insight has enabled the development of an effective carbon tax proposition and the allocation of carbon budgets.

National Treasury and DEA have explicitly stated that in case the envisaged carbon tax implementation date of 1 January 2019 has to be moved, “it will not be moved too late given South Africa’s NDC commitments”. This is not surprising given that the NDC has laid down a five-year period, 2016-2020 to be specific, for the development and implementation of the proposed mix of measures. This is conforming the Paris Agreement timelines: coming into effect in 2020.

The carbon tax has been designed by taking into account a phased approach, so that companies that emit greenhouse gas emissions can take measures to start reducing their carbon footprint or making provision to utilise allowance-mechanisms such as offsetting. By not acting now, companies can face a situation where they will only be able to options available at the time of the carbon tax being fact: paying tax!

Please visit our page; Carbon Tax in a nutshell if you have any more questions about the carbon tax and click here for an overview of our carbon tax service offerings.

Why your energy project should consider the imminent carbon tax emissions market

Original article was written by  Jay Govender and Adriaan van der Merwe.
Cliffe Dekker Hofmeyr   South Africa September 3, 2018. Click here to view full article.

In 1997 South Africa became a party to the United Nations Framework Convention on Climate Change (1992) (Convention). Directed at regulating human conduct that causes the emission of gases responsible for climate change (so-called greenhouse gases or “GHG”), the Convention sets binding targets for industrialised countries to reduce their GHG emissions. The Kyoto Protocol (1997), adopted under the Convention, goes further and provides market-based mechanisms intended to assist parties in meeting emission reduction targets.

South Africa’s committed contributions to reduce carbon emissions and to meet its emission targets are set out in the Paris Agreement on Climate Change (2015), which comes into effect in 2020. At a country level the South African government has proposed the introduction of a carbon tax, coupled with carbon offsets, to meet these emission reduction targets.

Carbon Credits

The Kyoto Protocol provides three market-based mechanisms intended to minimise carbon emissions. One of these is the clean development mechanism (CDM). It allows industrialised countries with emission reduction targets to undertake GHG reduction projects in developing countries, and to generate Certified Emission Reductions (CERs). Often referred to as carbon credits, CERs can be traded on international markets and thereby used by industrialised countries to meet their respective targets under the Convention.

The procedure for issuing CERs was determined at the 7th Conference of the Parties to the Convention held at Marrakesh in 2001 (the so-called “Marrakesh Accord”). This established the CDM Executive Board and the rules for CDM. The Marrakesh Accord stipulates a procedure by which the CDM Executive Board ultimately approves (or rejects) a project and issues CERs.

It is a requirement that participating countries must identify a designated national authority (DNA), which must consider applications for CDM projects and certify that they comply with national laws and the international law requirements as part of the process for issuing CERs. South Africa has designated its DNA in regulations made under the National Environmental Management Act, No 107 of 1998 (DNA Regulations). The appointed DNA is the Director-General of the Department of Energy (DoE).

The DNA Regulations grant the DNA powers and impose on it various obligations. These include that the DNA is required to:

  • establish a process for CDM project approval;
  • consider project proponents’ applications and endorse that the project complies with international and national criteria for CDM projects; and
  • issue letters of approval to project proponents in respect of CDM projects that meet the international and national substantial development criteria.

Carbon Tax

Carbon tax is not a new concept in the South African energy industry, with the first explicit carbon tax introduced as far back as 2008 by way of an environmental levy on electricity generation from non-renewable sources above 5MW. This levy is still currently in place.

In 2015 Parliament tabled a draft carbon tax bill (2015 Bill), seeking to price carbon emissions in the form of a tax. The 2015 Bill was the predecessor of the current draft Carbon Tax Bill which was published in December 2017 (Carbon Tax Bill), and was open for public comment until 9 March 2018. In the 2018 budget, the then Minister of Finance, Malusi Gigaba announced that the Carbon Tax Bill would be implemented from 1 January 2019.

The Carbon Tax Bill aims to enable South Africa to meet its required contribution commitments as per the 2015 Paris Agreement on Climate Change, rewarding the efficient use of energy and reduction of greenhouse emissions. The Carbon Tax Bill is structured around the “polluter pays” principle to incentivise firms and consumers to proactively consider the cost of carbon emissions in their production, consumption and investment decisions.

The Carbon Tax Bill provides that carbon tax will be levied on a person that conducts an activity as published by the Minister of Environmental Affairs under the National Environmental Management: Air Quality Act, No 39 of 2004. Electricity production (combustion of fossil fuels, excluding the use of back-up generators) is currently listed as such an activity. The taxpayer of such carbon tax will therefore be the energy producer.

The Carbon Tax Bill proposes that the rate of carbon tax will be R120 per tonne of carbon dioxide. This will be subject to the applicable tax-free allowances as stipulated in s7 to s13 of the Carbon Tax Bill, which are limited to a maximum total allowance per listed activity. For example, in the case of the main activity being electricity and heat production, such as in the case of a coal power generation plant, these tax-free allowances include:

  • a 60% allowance for fossil fuel combustion;
  • a 5% carbon budget allowance; and
  • a 10% carbon offsets allowance (which is discussed in greater detail under Carbon Offsets below).

The maximum total tax-free allowance for electricity and heat production is 75%. This would mean that if the coal power plant in the above example utilise all available allowances, it will pay carbon tax on 25% of carbon dioxide produced.

A taxpayer’s carbon tax liability is calculated by reducing the tax base by the allowances provided for above, and then multiplying that amount by the rate of carbon tax. A simplified version of the formula is as follows:

X = (E – D – S) x (1 – C) x R

Where:

X = the amount of carbon tax;

(E – D – S) = greenhouse gas emissions as calculated per the provisions of the Carbon Tax Bill;

C = percentage allowances determined in s7 to s13 of the Carbon Tax Bill; and

R = rate of carbon tax.

According to the National Treasury and the South African Revenue Service, as set out in the Draft Carbon Tax Bill 2017: Response Document, the existing environmental levy for electricity generation is currently fulfilling dual objectives of promoting energy efficiency and indirectly pricing GHG emissions. The document states that to effectively price GHG emissions and to ensure that no double taxation occurs, a credit or reduction of the environmental levy for electricity generation is proposed to be implemented upon the introduction of the carbon tax.

Carbon Offsets

Draft Carbon Offsets Regulations (Regulations) was published on 20 June 2016 but apply to the 2015 Carbon Tax Bill. Updated regulations have not been published pursuant to the Carbon Tax Bill.

The Regulations aim to provide an offset mechanism where a carbon offset may be claimed to enable a reduction of carbon tax liability. An offset will be allowed to a taxpayer for CERs from the furtherance of an approved project. Approved projects include projects certified under the CDM, Verified Carbon Standard or Gold Standard verification mechanisms, or a project that complies with another standard approved by the Minister of Energy. The approved project must be a project that is wholly undertaken in South Africa, and in respect of an activity that is not subject to carbon tax.

An allowance for an offset that is carried on, on or after 1 January 2017 can only be utilised for a certain duration of time after the offset is generated, depending on the type of approved project. The Regulations define an offset as “a measurable avoidance, reduction or sequestration of carbon dioxide equivalent (CO2e) emissions in respect of an approved project”. For instance, a CDM project’s offsets may only be utilised for seven years, which period may be extended with two periods of seven years, or for 10 years (which period may not be extended).

The Regulations therefore allow a party to accumulate offsets from an activity that is not subject to carbon tax, which can then be used to reduce carbon tax liability for an activity which is subject to carbon tax. For example, carbon offsets earned under a renewable energy generation project can be used to reduce the carbon tax liability of a coal power generation plant, limited to the 10% carbon offset allowance set out in the Carbon Tax Bill.

Examples of activities that will accumulate carbon offsets include energy efficiency in the residential and commercial sector, energy efficiency in buildings, community-based and municipal energy efficiency and renewable energy, fuel-switching projects, and electricity transmission and distribution efficiency.

The explanatory note to the Regulations provides that it will have to be assessed whether carbon offsets will be traded via over-the-counter or auctioning methods, or even whether a South African trading platform will be established.

The Regulations, however, limit the projects that can accumulate offsets and specifically exclude projects that benefit from other government incentives, as this could lead to double counting of emission reduction benefits. Projects benefitting from the Energy Efficiency Savings Tax Incentive as well as projects with power purchase agreements under the Electricity Regulations on New Generation Capacity (New Gen Regs) -such as independent power producers under the Renewable Energy IPP Procurement Programmes (IPPs) – can therefore not accumulate carbon offsets that can be used to reduce carbon tax liability. Carbon offsets can, however, be claimed by other renewable energy generators that do not have power purchase agreements pursuant to the New Gen Regs.

Conclusion

What is evident from the above is that the intricate legal framework surrounding carbon emissions in South Africa will present a myriad of opportunities to contribute to emission reduction targets and create a market for carbon emissions. Electricity generators should therefore ensure that that they adequately position themselves so as to derive the maximum benefit from the proposed legislative interventions. Importantly, carbon tax risk should also be taken into account in the development of a power project attracting such tax.

At Climate Neutral Group we can assist you with the development of your carbon project. We guide project developers from the project’s inception stage to feasibility assessments, verification processes, and all the way the issuance of carbon credits. Contact our Senior Carbon Advisor Silvana Claassen for information silvana.claassen@climateneutralgroup.com.

Comply or pay?

The second deadline for reporting your greenhouse gas emissions is steadily approaching (31 March 2019). Why wait until the beginning of the new year with collating your data? Why not put measures in place now? So that you can capture ánd manage the data required for your emissions reporting requirements.

But more importantly, why not ensure compliance nów and mitigate the risk of facing a R5 million penalty due to failing submission of information required by the National Greenhouse Gas Emission Reporting Regulations, that were promulgated on 3 April 2017.

The most important aspect of the Reporting Regulations is to assess whether or not the regulations are applicable to your business. This is determined by the capacity of your company to generate greenhouse gas emissions.

Should the outcome be that the Reporting Regulations are applicable to your company, a number of requirements must be met:

  • Firstly, you must ensure that your company, including all facilities where ‘listed activities’ are exceeding a pre-defined capacity threshold level, are registered within 30 days after the promulgation of these regulations (i.e. before 3 May 2017). If the regulations are applicable to your business and you have not submitted the required information to the Department of Environmental Affairs, you are committing an offence in terms of regulation 16 of the Reporting Regulations and could therefore face a 5 million penalty.
  • Secondly, relevant activity data must be collated for the reporting period (1 January up and until 31 December) to enable quantification of greenhouse gas emissions in accordance with the “Technical Guidelines for Monitoring, Reporting, Verification and Validation of Greenhouse Gas Emissions by Industry”.
  • Finally, you must submit the calculated quantities and activity data for all relevant facilities to the competent authority within the Department of Environmental Affairs before 31 March following the reporting year.

Climate Neutral Group is here to help you assess your reporting obligations and ensure compliance with the regulations. For more information visit our website, or contact me at 010 300 6015 or at silvana.claassen@climateneutralgroup.com.

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Greenhouse Gas Reporting & Carbon Tax courses

We have decided to reschedule the first series of our new training courses on the Carbon Tax, reporting regulations and carbon inventories, originally scheduled for 18-22 June in Johannesburg, to a later date around end August/beginning September. The reason is to allow the content to be better aligned with a number of relevant regulatory announcements and publications that are expected to be made by the Department of Environmental Affairs and the National Treasury. We will provide additional information as soon as possible.

We regret however any inconvenience this has caused to your busy schedule. For more information please do not hesitate to contact Silvana Claassen at 078 097 0852 or silvana.claassen@climateneutralgroup.co.za.

The tools to achieve and maintain compliance

Three new courses on topics relevant to South Africa’s transition to a low-carbon economy. Presented by Silvana Claassen of Climate Neutral Group and Adam Simcock, Chairman of Carbon Check South Africa, in collaboration with Naresh Badhwar, Head of Sustainability of Carbon Check India.

 

When?      18 June – 22 June 2018 from 08h30 to 16h00 (registration from 08h00)

Where?    Future Space, 1st Floor | 61 Katherine Street | Sandton 2196

Why?        To equip companies with the tools to manage and report on Greenhouse Gas emissions and ultimately enable businesses to calculate their own carbon tax liability.

 

What to expect:

These exciting and comprehensive courses focus on the following topics:

  • Mandatory reporting – why, what and how must reporting be done?
  • Carbon Tax – how to calculate tax liability and use allowances to maximise tax reductions?
  • GHG Emissions Inventory – how to identify, calculate and report emissions as per regulatory requirements?

 

Mon 18 June – Mandatory GHG Emissions Reporting 1-day Course @R2,900 (Excl. VAT)  

Tue 19 June – Carbon Tax 101, 1-day Course  @ R2,900 (excl. VAT)                                       

Wed 18 – Fri 22 June  GHG Emissions Inventory 3-day Course @ R7,900 (excl. VAT)          

Register for all three courses and pay only R 12 500 excl. VAT instead of R 13,700 excl. VAT

 

REGISTER NOW

 

In partnership with:

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SA cabinet approves climate change bill

24/5/18 (Carbon Pulse) – South Africa’s cabinet on Thursday approved the government’s proposed carbon tax bill, bringing the long-delayed legislation a step closer to becoming reality.

The bill, which finally entered the parliamentary process after years of hold-ups, will now proceed to a public consultation before it is put to MPs for a vote, with the government hoping to formally introduce the tax in Jan. 2019. The proposal has already had two years of extensive consultation on various drafts and at least another five years of planning before that.

Under the current draft, the tax’s base level would start at R120/tonne ($9.66), rising annually by 2% plus inflation until the end of the first phase (2022), and then align with inflation after that.

However, all emitters will face an effective rate of R6-48/tonne based on the suite of exemptions available and the admissibility of offsets, with some companies able to reduce their tax burdens by as much as 95%. A basic tax-free allowance of 60% is offered to all emitters, with an additional 10% for having process or fugitive emissions.

Another variable allowance of up to 10% is available for trade-exposed sectors, with an additional 5% available for above-average performance relating to sectoral benchmarks. Beyond that, a further 5% can be applied by companies who have developed an annual carbon budget and report it to the government, which itself is planning to design national carbon budgets to help South Africa’s Paris Agreement targets.

Companies will also have an offset usage limit of 5-10% depending on what sector they’re in. The government in June 2016 published draft guidelines outlining the eligible certification and project types but limiting use to credits generated domestically. But big energy users including Sibanye-Stillwater and ArcelorMittal oppose the tax, arguing that even the heavily-discounted levy is unaffordable and will jack up power prices, and therefore should be scrapped or further delayed.

The tax will affect virtually all areas of South Africa’s economy, covering most stationary and non-stationary sources and applying to fossil fuel combustion, fugitive emissions, and industrial processes.

Waste, agriculture, forestry, and other land-use sectors are exempt from paying it or performing MRV until 2022 due to the difficulty in accurately measuring the output from those sources.

A national carbon tax was first suggested by South Africa in 2010, a year before it hosted the annual UN climate talks. But progress has been slow, with the government only publishing the first draft in Nov. 2015.

South Africa’s Paris Agreement pledge requires its GHG emissions to peak in 2020 to 2025, plateau for a 10-year period from 2025 to 2035, then decline from 2036 onwards. More than 80% of its emissions come from its coal-dominant energy sector.

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Welcome to the CNG Team: Silvana Claassen

Global climate change awareness is growing, particularly in terms of what companies can do to reduce and eliminate their environmental impacts and become corporate climate action leaders. Climate Neutral Group, as a result, has been growing too! Earlier this year we welcomed senior carbon advisor Silvana Claassen to our South African team.

1) Why and when did you join Climate Neutral Group?

I joined Climate Neutral Group on 1 April 2018 after a very inspiring meeting with its country director Franz. I figured that my own aspirations to contribute to climate change management and mitigation are in line with Climate Neutral Group’s mission and vision.

2) What do you hope to achieve as a carbon adviser at Climate Neutral Group?

I am passionate about helping businesses understand how climate change can impact their organisations and how they can adapt to the dynamics involved with South Africa’s transition to a low carbon economy. I would love to play an active role in this. I have to note that the country’s journey, including the recent promulgation of the Emissions Reporting Regulations, its carbon tax measures and the approval of the Climate Change Bill, is in line with the objectives of the National Development Plan (NDP). This government-initiated strategy aims to foster inclusive and sustainable economic growth, eliminate poverty, and reduce inequality whilst protecting the environment.

3) What has been the highlight since you joined Climate Neutral Group?

What has stood out are the face-to-face dialogues with several clients. These have contributed to an increased understanding of the challenges these businesses, and the country’s private sector as a whole, are facing when it comes to managing their greenhouse gas emissions.

4) How important is it that companies in South Africa (and beyond) start and up their efforts to minimise their impact on the planet?

Having specialised in the matter since 2011, I know climate change is a genuine threat to the planet, to every living being, and to every single business. Global action by companies in South Africa and elsewhere, as well as measures from governments and citizens, is fundamental to protect the planet for current and future generations. We all need to become corporate climate action leaders.

5) How important is offsetting to mitigate climate change?

Offsetting is necessary to achieve carbon neutrality, or at least to mitigate emissions that would not have occurred without it. It is a tool that is used to compensate for greenhouse gas emissions that are unavoidable given the current state of technology. Last but certainly not least, fighting climate change also forms part of the Sustainable Development Goals (SDGs). Because of my background and the work I do, I fully support these 17 goals, which were adopted in 2015.

6) What are your three best tips for carbon tax-liable companies who seek to become climate neutral?

Start by measuring your organisation’s carbon footprint to understand the impact of your business activities in terms of greenhouse gas emissions. Secondly, talk to a carbon specialist to design a meaningful strategy to reduce your footprint, set future reduction targets and identify cost-effective measures to enable achieving these targets. Finally, offset what you can’t avoid and make an impact somewhere else through the purchase of carbon credits from verified offset projects. It is important to know offsetting has socioeconomic benefits too, such as improved (indoor) air-quality, women empowerment, and food security.

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INVITE: Carbon Tax Essentials breakfast event

We invite you to our “Carbon Tax Essentials” business breakfast on 12 April 2018 (08:00-10:00) at The Maslow Hotel in Sandton.

The regulation of carbon emissions in South Africa is advancing rapidly and is becoming increasingly complex. This includes the publication of the GHG Reporting Regulations in April 2017, the publication of the Pollution Prevention Plans Regulations in July 2017, and more recently, the release of the Carbon Tax Bill in December 2017 which is set to come into effect 1 January 2019.

Comments from the public on the Draft Carbon Tax Bill included that it is complex and therefore it remains a challenge for organisations to assess the impact on their bottom-line. This interactive seminar will focus on assisting companies to understand the implications of South Africa’s proposed carbon tax and offset legislation.

Climate Neutral Group will host a breakfast-workshop at The Maslow Hotel in Sandton on 12 April (08:00-10:00) during which it will present all essential carbon tax elements companies and organisations should understand. Participants are then invited to engage in an informal discussion about the topic, allowing them to identify concerns and ask questions on carbon tax-related matters.

These essential topics include the various carbon tax allowances that exist, what companies must consider in order to benefit from the Carbon Tax, and what mechanisms exist to reduce their tax liability.

Other topics on the agenda include a brief analysis of the various financial and tax implications, which greenhouse gas-emitting activities result in carbon tax payments, and the relationship between the proposed carbon tax and the GHG Reporting Regulations. We will also have a closer look at how offsets can reduce a company’s carbon tax liability. Finally, we will demonstrate various ways on how companies can calculate their carbon tax obligation.

Speakers:
•    Franz Rentel, Country Director South Africa, Climate Neutral Group
•    Silvana Claassen, Senior Carbon Advisor, Climate Neutral Group

Date:      12 April 2018
Time:      08:00-10:00 (arrival 07:45 for 08:00)
Venue:    The Duke Room, The Maslow Hotel, Sandton, Johannesburg

* the conference facilities at The Maslow Hotel are climate neutral. All emissions generated by the venue have been offset with our Wonderbag carbon offset project

Please note: seating is limited to 20 people. Please RSVP early to avoid disappointment.
Cost: R350 (ex VAT) / person. CNG clients: Free.

REGISTER NOW

Media: please email us!

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Deadline GHG Emission Reporting: 31 March!

The National Greenhouse Gas Emission Reporting Regulations came into effect on 3 April 2017, with the first submission deadline being set for 31 March 2018. The purpose of these regulations is to allow the Department of Environmental Affairs (DEA) to gather information from businesses to assist South Africa to update and maintain a National Greenhouse Gas Inventory. This is a requirement under the Paris Climate Agreement, which South Africa ratified in November 2016.

The Greenhouse Gas (GHG) emissions companies report will be used as the basis for their carbon tax calculations. Companies, in control of certain GHG emitting activities and which exceed a predetermined threshold, will be required to submit GHG emission data in a format prescribed by the Regulations. The calculations of their emissions must be done in line with Technical Guidelines. These were published with the Regulations. Companies should note that the calculation methodologies in these Technical Guidelines differ from the conventional corporate calculation methodologies as GHG Protocol Corporate Standard and ISO14064.

STEPS YOUR COMPANY SHOULD TAKE NOW: 

  1. Determine whether it is in control of an activity listed in Annexure 1 of the Regulations,
  2. Determine whether the installed capacity, associated with that activity, exceeds the indicated threshold. If so, register your company and familiarise yourself with the NAEIS portal. Report your emissions by 31 March 2018 (as per the National Greenhouse Gas Emission Reporting Regulations). This is mandatory.
  3. The emissions reported to the Department of Environmental Affairs are the exact same emissions that will be subject to carbon tax payments. The carbon tax act should be effective from 1 January 2019. This means your company will pay carbon taxes to SARS over the emissions generated in the 2019 calendar year.
  4. Start planning now as to how to reduce your company’s possible future carbon tax exposure. You could look at ways to lower your operations’ GHG emissions through technological interventions. You could also think about offsetting, known as investing in carbon offsets.

Do you need more information? Please download our Mandatory GHG Reporting Factsheet!

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South Africa carbon tax date announced

22/2/18 (Ernst & Young) – In the 2018 Budget Speech, presented on 21 February 2018, South Africa’s Minister of Finance announced that the Carbon Tax Bill is expected to be enacted before the end of 2018. This means that Government proposes to implement the Carbon Tax from 1 January 2019 to meet its nationally determined contributions under the 2015 Paris Agreement of the United Nations Framework Convention on Climate Change.

National Treasury published the Second Draft Carbon Tax Bill in December 2017, inviting written comments to be submitted by close of business on 9 March 2018.