South Africa’s Climate Change Bill: pros and cons of its emissions approach

A year has passed since South Africa’s Minister of Forestry, Fisheries and the Environment (Minister) introduced the Climate Change Bill to Parliament, which will be South Africa’s first legislation that directly addresses climate change mitigation and adaptation. The urgent need for such legislation has been highlighted over the past year, with severe floods, storms and droughts being recorded across the country.

Human-driven emissions of greenhouse gases have increased to such an extent, and at such a rapid rate, that the earth is now warming faster than at any point in recorded history, leading to drastic changes to our climate. It has been predicted that climate change could cost South Africa up to 11% of GDP per capita by the end of the century. South Africa is particularly vulnerable to the effects of climate change as primary sectors of our economy such as agriculture and mining are energy intensive and dependent on natural resources. Furthermore, South Africa has limited resources and infrastructure to deal with climate extremes.

With this in mind, this brief explores some of the mechanisms created by the Climate Change Bill (the Bill), and some of the flaws in these mechanisms.

Overview of the Climate Change Bill

The Bill’s objectives are:

• to provide a coordinated and integrated response to climate change; for the effective management of climate change impacts;
• to make a fair contribution to the global effort to stabilise greenhouse gas concentrations in the atmosphere;
• to ensure a just transition towards a low-carbon economy and society;
• to give effect to South Africa’s international commitments and obligations; and
• to protect and preserve the planet for the benefit of present and future generations.

Since its introduction to the National Assembly in February 2022, the Bill has been through several public participation processes. The most recent public hearings were held in October 2022 ahead of the COP 27 climate negotiations. A committee in the National Assembly (NA) is now considering submissions made in the hearings and debating the Bill. If the NA passes the Bill, it will move to the National Council of Provinces (NCOP), which will hold further public hearings. The NCOP must then pass the Bill, with possible amendments, and then refer it back to the National Assembly for further consideration and a final vote. The President will then sign the Bill into law, subject to any reservations about the constitutionality of the Bill, in which case it would be referred back to the National Assembly. This process is expected to take considerable time due to the various public participation processes, discussions, and opportunities for amendments that are available to all parties.

The Bill’s mechanisms to reduce greenhouse gas emissions

On a national level, the Bill provides two main mechanisms to reduce the country’s greenhouse gas emissions:

• Section 21 of the Bill obliges the Minister to determine a national greenhouse gas emissions trajectory. This trajectory must be set in consultation with Cabinet. The trajectory must specify a national greenhouse gas emission reduction objective. This objective must be informed by South Africa’s current and projected greenhouse gas emissions and be consistent with South Africa’s international obligations.
• Section 22 of the Bill deals with sectoral emissions targets. According to section 22, the Minister must identify greenhouse gas emitting sectors and sub-sectors that should be subject to sectoral emissions targets. The Minister must then set sectoral emissions targets for each sector, in consultation with the relevant Minister responsible for that sector. These targets must align with the national greenhouse gas emissions trajectory. The Minister responsible for each sector must then implement each sectoral target through a range of planning instruments, policies, measures, and programmes.

For individual companies, the Bill provides a further mechanism for reducing greenhouse gas emissions. Section 23 and 24 of the Bill make provision for the allocation of carbon budgets. According to section 23, the Minister must publish a list of greenhouse gases which are reasonably believed to contribute to climate change, and a list of activities which emit such greenhouse gases. If a company emits above a certain threshold of the listed greenhouse gases, or undertakes one of the listed activities, they will be subject to a carbon budget as determined by the Minister. The company in question must adhere to this carbon budget and must submit a greenhouse gas mitigation plan to the Minister. When allocating a carbon budget the Minister must take all relevant considerations into account, including the national trajectory. Carbon budgets allocated to companies within the above-mentioned sectors will align with the relevant sectoral targets.

It is useful to consider how these mechanisms work in relation to each other. The national trajectory sets the total permissible greenhouse gas emissions for the country. The sectoral targets set the permissible greenhouse gas emissions for specific sectors and sub-sectors. Cumulatively the targets cannot exceed what is set by the national trajectory. Carbon budgets will determine the emissions of individual companies.

Section 21 can be seen as the golden key to the country’s development trajectory in the context of climate change. The trajectory will effectively limit and shape South Africa’s economic activity as the country aligns itself to the trajectory’s permissible greenhouse gas emissions. The sectoral emissions targets will dictate the scope and nature of economic activity within each specific sector. Decisions by government bodies responsible for these sectors will need to be based on what is permissible in terms of the applicable target. Carbon budgets will limit companies to certain amounts of greenhouse gas emissions and must be aligned with the country’s national goals.

From an environmental perspective, these proposed measures could play an important role in South Africa’s climate change response by reducing greenhouse gas emissions nationally. Furthermore, they will ensure that there are specific measures in place for specific sectors, industries, and individual companies, which may be contributing significant harm to the environment.

Concerns with the Bill

The Constitution grants everyone the right to an environment that is not harmful to their health and well-being. Climate change poses a huge risk to the right to a healthy environment. It is therefore vital that the Bill helps South Africa to mitigate and adapt to climate change. Furthermore, the Bill must reflect the need for urgent and effective action in response to the climate crisis. In its current form, the Bill presents challenges relating to centralisation of power, time-frames, penalties and cohesion with other legislation.

The Bill provides a dangerous centralisation of power

In terms of the Bill, the Minister need only consult with the Cabinet and sectoral ministers. The Bill does not specify that the Minister must come to an agreement with them. Therefore, while the Minister must seek information or advice, they are not obliged to abide by that advice. This creates a dangerous centralisation of power. Given the huge potential impact of the national trajectory and the corresponding sectoral targets on the economy and on policies and measures within specific sectors, and on the subsequent allocation of carbon budgets, it is essential that the Minister adhere to the requirements of just administrative action as stipulated by the Promotion of Administrative Justice Act 3 of 2000 (PAJA).

The Constitution and PAJA provide that administrative action must be procedurally fair, reasonable, and lawful. According to PAJA, an administrative action does meet these requirements if (among other things) there is no public participation, if people affected by the action are not given reasons for it, if the action was taken in bad faith, or if it was irrational, unreasonable or not authorised by law. In order for the Minister’s new powers under the Bill to be appropriately checked, the Minister must comply with PAJA and thereby ensure just administrative action.

The Bill lacks sufficient time-frames

Given the delays already experienced, and the significant processes that must still take place before the Bill can come into force, it is predicted that the Bill will at best be enacted by the end of the year. The Bill does not specify by when after enactment the Minister must determine the national trajectory. Section 21(3) states that until such time that the Minister determines a national trajectory, the trajectory in Schedule 3 of the Bill will serve as the national trajectory. Schedule 3 currently correlates with South Africa’s 2015 Nationally Determined Contribution trajectory, which was determined in terms of the Paris Agreement. Given that climate researchers have already deemed the Schedule 3 trajectory to be insufficient, and that the Bill has been under consideration for more than a year, the lack of a binding time-frame on the Minister to determine the national trajectory is deeply concerning.

Section 22 stipulates that the Minister must determine the sectoral targets within one year of the Bill coming into operation, and must be aligned with the national trajectory. However, as stated above, there is no time-frame attached to the determination of the national trajectory. If the Minister does not determine the national trajectory within a year of the Bill coming into operation, it will be impossible for the sectoral targets to align with it. Alternatively, the sectoral targets will align with the Schedule 3 trajectory. As previously stated, the Schedule 3 trajectory is extremely outdated. It will therefore be problematic for the sectoral targets to be based on this.

The Bill does not provide sufficient penalties

Section 32 of the Bill sets out offences and penalties. The only offence that is currently listed in this provision is if a company fails to submit a greenhouse gas mitigation plan to the Minister in terms of section 24. It is not an offence for a company not to adhere to its carbon budget. Therefore, as the Bill stands, the carbon budget mechanism cannot be enforced and consequently is unlikely to inform the behaviour of companies subject to it.

The Bill is not cohesive with the Carbon Tax Act

The Bill does not speak to the Carbon Tax Act 15 of 2019 (the Carbon Tax Act). The Carbon Tax Act has introduced a tax based on companies’ greenhouse gas emissions. It is therefore essential that the Bill and Carbon Tax Act are cohesive, as they both seek to regulate companies’ emissions. Failure to align these laws will result in considerable confusion for companies and industries and add unnecessary hurdles for compliance with both the Bill and the Carbon Tax Act.

Conclusion

The Bill represents an important progression in South Africa’s response to climate change. It provides mechanisms to reduce the country’s greenhouse gas emissions that are vital to climate change mitigation. However, the Bill still presents certain challenges. It is essential that the Minister’s decision-making powers to set the national trajectory, sectoral targets, and carbon budgets, meet the requirements for just administrative action as encapsulated and regulated by PAJA. This is especially apparent when one considers the impact of these decisions on South Africa’s development.

For the Bill to be truly effective in responding to climate change, the time-frames for implementation must be bolstered to reflect the need for urgent action. Furthermore, in order for carbon budgets to be effective in influencing behaviour, the Bill must introduce penalties for non-adherence and be brought in line with the Carbon Tax Act.

Please note: The information contained in this note is for general guidance on matters of interest, and does not constitute legal advice. For any enquiries, please contact us at [email protected].