04 December 2023
by Witness Netshitumbu, Anthesis | CNG Carbon Project Developer
The JSE Ventures Voluntary Carbon Market launch was held at Johannesburg Stock Exchange (JSE), Sandton in the first week of November. The JSE Carbon Market is a collaboration with Xpansiv, a US-based infrastructure provider for global environmental markets.
The Carbon Market targets both private and public companies looking to buy carbon credits to offset their carbon emissions, as well as carbon project developers looking to sell their carbon credits from carbon reduction and avoidance projects.
The JSE team introducing the Market explained that the drivers for developing the carbon market include the imperative to service the South African Carbon Tax, help South Africa meet the 2030 & 2050 Commitments as well as align with the Africa Carbon Market initiative. The JSE aims to accelerate the creation of carbon offset projects by helping to meet the demand for credits by emitters seeking to offset their emissions towards their net-zero commitments.
The panel for questions and answers included representatives from JSE, Xpansiv, Promethium Carbon & Standard Bank. The panel discussion focussed on various topics around the new market and carbon taxes as economic drivers for South Africa as the largest emitter on the continent also including an explanation of the measures the carbon market has put in place to avoid emissions double counting.
The panel also discussed the risks for commercial banks looking to finance carbon projects as well as the constraints faced by carbon project developers. Currently most carbon project developers rely on pre-sales of carbon credits to capitalise their projects. Commercial banks can assist in growing the supply by looking at de-risking strategies for carbon finance by developing partnerships with Development Finance Institutions (DFIs). If various institutions join hands in addressing the issue of carbon finance, we are likely to see more carbon projects in South Africa.
Witness Netshitumbu attended the Carbon Market Launch representing Anthesis | Climate Neutral Group (CNG), as Carbon Project Developer. The main core business of CNG is to develop carbon projects aimed at reducing carbon emissions and generate carbon credits which can be traded through the carbon market. The Launch was attended by various representatives from the SA government departments, commercial banks, Carbon Project Developers & consultants, Law Firms, and other private sectors.
According to Witness, the JSE Ventures Voluntary Carbon Market will ease the process of trading carbon credits generated locally in South Africa. In South Africa and Africa more generally, there is currently more demand for carbon credits than supply. The JSE Carbon Market will encourage the carbon project developers like CNG to develop more carbon projects and generate carbon credits.
South African has a number of carbon projects which are either registered or seeking registration under VCS (Verified Carbon Standard), such as CNG AgriCarbon Programme. These projects will have an opportunity to utilise the JSE Carbon Market in trading their carbon credits.