The yawning gulf between the green lobby and key elements of big business over climate change came under the spotlight this week when Sasol, Eskom and the Chamber of Mines put the boot into the draft National Climate Change ResÂponse white paper during parliamentary hearings.
The paper was welcomed by environmental groups for its shift towards a carbon budget approach and the promise of emission reduction outcomes. This implied, according to the World Wild Wide Fund for Nature, the inclusion of targets for each sector and sub-sector of the economy, and a move “from voluntary to mandatory mitigation plans”.
Although Environment Minister Edna Molewa said South Africa was “walking the talk” in the white paper by aiming to reduce emissions by 34% against a “business as usual” baseline by 2020, big business complained this week that such a move could threaten jobs and hurt economic development.
On Tuesday, at public hearings staged by Parliament’s water and environmental affairs committee, Sasol, Eskom and the Chamber of Mines expressed reservations about the policy and the limits it placed on emissions by top polluters.
The chamber said it seemed that the government had reneged on previous agreements not to include any reduction targets until their implications for industry was clarified.
“We find that the department of environmental affairs has gone back on its word and has included numbers that are still in discussion, including whether the baseline that informed these numbers was correct,” the chamber said.
The white paper includes the proposal to develop “emission reduction outcomes” for each sector and sub-sector of the economy in the development of carbon budgets.
Where significant emissions were being produced at particular source points the carbon budgets would “be cascaded down to sub-sectors and ultimately companies whose emissions are above a specified threshold”.
The white paper also proposes economic instruments such as a carbon tax and incentives to industry and households to aid mitigation efforts. But power utility Eskom, one of the country’s top carbon emitters, warned against the blanket application of a carbon tax.
Mandy Rambharos, the climate-change manager at Eskom, stressed the need for a thorough understanding of the potential macroeconomic impact of all market and non-market instruments.
“A blanket carbon tax, for example, is a blunt instrument that will not produce the desired results to reduce emissions and change behaviour,” she said.
“It may, in fact, result in pervasive behaviour [such as exporting emissions] and have a negative impact on emissions as well as greater economic impacts such as job losses.”
The question of funding was also critical, she said, particularly for the electricity sector. “The means of implementation of climate change activity is extremely important for the electricity sector.”
According to the integrated resource plan of 2010, the state’s 20-year electricity development programme, the move to a low carbon future carried a price tag of R856-billion, Rambharos said.
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