SA 'green' economy coming
2010-05-27 14:46
-
Climate Change
Read more about the environmental changes and challenges the world faces.
Now R255.95
buy now
Cape Town - SA will soon have "green" legislation and some companies are concerned it will have a major impact on the bottom line.
"Business needs to urgently engage government on major climate change policies as it will directly affect their bottom lines," said head of Deloitte Carbon Management Solutions, Paul Devine.
He is concerned that business has been largely reactive to the policy changes from the government regarding climate change and wants corporates to discuss "legislation around carbon pricing".
In an address at the Green Economy summit, science and technology minister Naledi Pandor said that her department would like to ensure economic growth and a policy that would create jobs, in line with the government's plan.
Key requirement
"The long-term greening of the economy needs new thinking to fundamentally transform the economy, including addressing deep-seated production and consumption issues," said Pandor.
"If we achieve South Africa's target of 1.5% of GDP for R + D (research and development) by 2014, we will be able to substantially increase our investments in green industry research, development, and innovation without compromising other promising and important industrial development or science programmes.
"A key requirement for achieving this important goal is a strong synergy between industry and government," Pandor added.
While Devine agreed that business and government should have dialogue, he urged industry to lobby the government for a better system than carbon tax.
"Our government appears to favour a carbon tax system as a policy instrument to reduce our national carbon emissions because it is easier and cheaper to administer. It is up to business to engage in the consultation process and lobby for the best system, and not the easiest system," said Devine.
The environmental danger of a carbon tax system is that instead of reducing emissions, some companies may elect to pass on the additional tax to their customers without making any investment to reduce it. This may impact negatively on the economy as a whole.
Double dividend
Devine believes the best system is an emissions trading scheme where "companies can mitigate their carbon emissions cost-effectively".
"However, when it gets very expensive to mitigate a marginal unit of emissions, the emitting business will look to purchase emission allowances from the market," said Devine. "In this way a business can find the lowest price to reduce their overall emissions."
Pandor said that her department has four interventions in the pipeline to shape a "growth path for the economy". These include investment in research into bio-composites, development of biodegradable packaging, introduction of "technology localisation" strategy which would support to local companies and sustainable technology and innovation "roadmaps".
These would, according to Pandor, provide a base from which the economy could grow, while at the same time, cutting carbon emissions.
"The green economy offers a double dividend - more low-carbon jobs and less carbon emissions," she said.
Pandor warned though, that SA did not have a renewable energy policy.
"We need a renewable-energy policy. According to the World Council for Renewable Energy, fewer than 10 countries have adequate renewable energy policies. I think South Africa should join the group that has an adequate renewable energy policy," she said.
- Follow Duncan on Twitter