State owned enterprise South African Airways (SAA) is exploring the implementation of a voluntary carbon offset project that can support the development of forestry in the Southern African region.

SAA operates in a global market that makes it extremely vulnerable to policies in countries that impose penalties and taxes on carbon emissions.

Speaking at the launch of the Climate Change Policy Framework for state owned enterprises (SOEs) on Thursday, Public Enterprises Minister Malusi Gigaba said that in order for SAA to avoid future penalties, it would require that biofuels make up half of its fuel supply by 2020.

“This will create a pressing demand for an extremely large quantity of biofuels which can form a base load against which a fully vertically integrated biofuels industry can develop in South Africa as well as in the Southern African region,” he explained.

The department has convened a supply chain and technical working group involving SOEs and relevant departments to develop a strategy for meeting aviation biofuels requirements.

“We expect an initial strategy to be released in the third quarter of this year,” said Gigaba.

The European Union Emissions Trading Scheme (EU ETS) system requires all airlines flying in EU airspace to pay 15% of their polluting carbon emissions for 2012, a charge which they will not have to fully settle until 2013.

Under the scheme, it is estimated that around 4 000 airlines will pay the EU for pollution permits. The EU ETS is a cornerstone of the EU’s policy to fight climate change as well as a tool to reduce industrial greenhouse gas emissions cost-effectively.

The EU ETS took effect in January. The law requires domestic carriers as well as any foreign airline landing in the EU to pay for their emissions under a cap-and-trade system.

Water and Environmental Affairs Minister Edna Molewa said the measure was a challenge.

“We do believe that as a country, we’ve got to hold hands and say to the EU in particular, that the … prohibition measure that’s already begun to be applied, we do see that as a challenge currently and we will be responding accordingly,” said Molewa.

Also speaking at the launch, Eskom chairman Zola Tsotsi said the parastatal was focused on providing sufficient electricity to sustain South Africa’s economic growth and development goals.

“Eskom is committed to provide electricity that ensures the sustainable growth and development of the country,” he said, adding that this would allow for poverty eradication as well as job creation.

The framework is aimed at optimising the impact of state owned companies on reducing carbon emissions and the development of the green economy without it compromising the companies’ financial viability.

 

Source: SA Government news service