According to Greenpeace, South Africa which relies largely on coal for its energy supply is the 14th largest polluter in the world and the largest in Africa. Given the negative impact of climate change on humanity and the role that greenhouse gas emissions play, it is a landmark moment when South Africa makes a significant effort towards curbing carbon emissions.
President Cyril Ramaphosa has signed into law a carbon tax to cut emissions in the continent's worst polluter. According to Treasury, the tax was part of South Africa's efforts to meet the global climate change agreement negotiated in Paris in 2015.
Climate change represents one of the biggest challenges facing humankind, and the primary objective of the carbon tax is to reduce greenhouse gas emissions in a sustainable, cost effective and affordable manner," the treasury said in a statement.
Paris Agreement 2015
Given the current unpredictable weather patterns that have led to drought and famine, there is no doubt that climate change is the largest threat facing our environment. This is a concern that is shared by many countries around the world hence the reason why the Paris Climate Conference (COP21) was convened in December 2015. At this conference, 195 countries adopted the first-ever universal, legally binding global climate deal commonly known as the Paris Agreement.
The Paris Agreement sets out a global action plan to strengthen the global response to the threat of climate change by keeping a global temperature rise this century well below 2 degrees Celsius above pre-industrial levels and to pursue efforts to limit the temperature increase even further to 1.5 degrees Celsius since this would significantly reduce risks and the impacts of climate change. At the very basic level, the Paris Agreement is a bridge between today's policies and climate-neutrality before the end of the century.
Additionally, the Agreement aims to strengthen the ability of countries to deal with the impacts of climate change. To reach these ambitious goals, governments agreed that appropriate financial flows, a new technology framework, and an enhanced capacity building framework will be put in place, thus supporting action by developing countries and the most vulnerable countries, in line with their own national objectives. To this end, countries submitted comprehensive national climate action plans (Nationally Determined Contributions (NDC)). Although these are not yet enough to keep global warming below 2°C, the Agreement traces the way to achieving this target.
The Agreement entered into force on 4th November 2016 and since then it has been ratified by 174 of the 197 countries that were present at the conference; South Africa being one of them.
Treasury notes that the tax was first planned in 2010 but could not be rolled out because of opposition from business and industry in a country struggling with low growth and unemployment near 28 percent. Following the Presidential assent, the tax which is considered a rare phenomenon for an emerging economy will now take effect from June 1 on greenhouse gases from fuel combustion and industrial processes and emissions.
The tax which is set at 120 Rand (8.30 USD) per tonne of carbon dioxide will be largely offset by allowances to lower it to an effective rate of between six and 46 Rand per tonne in the first three years. It is however set to rise at two percent above inflation, currently at 4.5 percent, until 2022 and in line with inflation thereafter.
Many environmentalists have praised President Ramaphosa with the WWF stating:
President Cyril Ramaphosa has communicated the urgent need for action around the climate crisis. While there is still much to be done for the tax to become more effective, we recognise this is a significant first step."
Melisse Steele, senior campaign manager at Greenpeace while lauding praise on the President was keen to express Greenpeace's concern over the effectiveness of the tax noting that the 'tax level was inadequate." Whether or not it is adequate, we will have to wait and see how it fairs upon operationalisation.
Header Image Credit: The Nerve Africa