The word “green” appears nowhere in the written copy of the finance minister’s speech, but it was uttered once, when Trevor Manuel ad-libbed: “This budget isn’t very green, but that will come next year.”
It is significant that Manuel has put environmental affairs on his agenda. But indications are that the treasury wants the environmental affairs department to take the initiative.
In the meantime, there are plenty of green Tips for Trevor.
The WWF and Earthlife Africa are lobbying hard for carbon tax to be included in next year’s budget.
“South Africa is a world top 20 greenhouse gas producer and the Southern African region is under the greatest threat from climate impacts. We are also a respected middle power, a trusted member of the Non-Aligned Movement, punching well above our weight on the world stage,” said Peet du Plooy, trade and investment adviser for the fund.
Du Plooy said South Africa’s first priority should be to use energy more efficiently and to distribute it better, rather than to supply more energy capacity. One way to curb demand and shift to greener options would be a carbon tax.
“Taxing carbon will allow the price of carbon fuels to more fully reflect their cost to society … treasury has already taken the lead in opening the door for a carbon tax in its framework on environmental fiscal reform,” he said.
Tristen Taylor of Earthlife Africa echoed Du Plooy’s concerns. “This would be on the ‘polluter must pay’ principle. For example, a coal-fired power station externalises the cost of pollution.”
Taylor also wants to see a restructuring of electricity distribution “because environmental issues are also social issues”. “We want to see a free 100kW per person within a step block tariff, so the more you use, the more you pay, and the incentive is to conserve energy. At the moment it’s 50kW per household, which is used up in the first week.”
This means that poorer households have to use paraffin or coal for energy, which leads to health problems.
“There’s also the bio-fuels issue,” Taylor said. Earthlife Africa says the biofuels subsidies presently target large-scale commercial farmers and represent a handout to industry from government. Instead, the bio-fuels strategy should target cash crops grown by small-scale subsistence farmers, possibly through a cooperative system. “There’s also the danger that the maize grown for biofuels [by large-scale farmers] will push up food prices, becoming an effective taxation on the poor,” Taylor said.
Taylor’s organisation is one of the most strident critics of the Pebble Bed Modular Reactor, arguing that it is too expensive and uses inappropriate technology. “For the same cost, you could have 100 000 solar cells in people’s homes producing the same amount of energy,” he said.
James Blignaut, a professor of environmental economics at the University of Pretoria, had several tips. He wanted to see more incentives and more support for renewable energy, such as rapid depreciation allowances and technological support. Businesses could also be encouraged to switch to cleaner production technologies.
Blignaut also suggested that the current tax law, whereby dormant land is taxed at a higher rate than cultivated land, should be reversed. Dormant land, such as forests or wetlands, provides environmental goods and services which should be recognised. Another option would be not to tax land itself, but to tax activities on the land that pollute.
“On the tax side there are a range of possibilities, such as environmental taxes on polluting industries,” Blignaut said. A tax on waste water discharge, for example, was already under discussion. In addition to a carbon tax, he suggested a resource input tax, such as on coal. This would act as an incentive to use fewer resources in production, and in the case of coal, there would also be a carbon benefit.