By Avesh Padayachee
Carbon offsetting, the mitigation of greenhouse gas emissions, is a vital component in our global quest for cleaner energy and addressing climate change. As such it should be universally accessible, but it’s not in South Africa. Not just yet.
Essentially, there are two mechanisms for addressing carbon emissions: reduction in or removal of carbon emissions, and carbon offsetting. The first is about eliminating pollution, the second about ameliorating the impact of those emissions that cannot be avoided. It’s principally the latter part (but not entirely) that I address in this article.
The polluter pays principle holds that the one who creates the pollution is responsible for cleaning up or remedying that pollution, as well as avoiding it going forward. Frequently, of course, the polluter doesn’t have the remedy and invariably has to pay for it: in other words, offsetting, through purchasing carbon credits from any project that offsets carbon emissions – such as a renewable energy producer, for example.
Because the offset is per-unit clean energy compared to fossil-fuel energy, and countries around the world have nationally determined contributions (NDCs) – their commitments to reducing greenhouse gas emissions to prevent climate change – international bodies and standards are required to ensure that carbon offsets are authentic.
The thing is, to register to trade in carbon credits is beyond the reach of many renewable energy companies: it is prohibitively expensive, time-consuming and administratively onerous; on top of this, there are costly annual audits conducted by international auditors. All these overheads eat into profitability, which is largely why there’s not a lot of capacity in South Africa. (There’s a vital principle at play here, too: polluters have to offset their emissions with carbon credits generated in the same country.)
I know all this because a subsidiary of the company I lead is in the final stages of registering to trade in carbon credits, which we generate through our renewable energy businesses. We’ve decided to bite the bullet and proceed with launching South Africa’s first carbon business because we have a plan – a grand plan – to bring carbon trading within reach of more renewables players.
We are now able to aggregate solar energy providers like us in a grouped project into which they pitch their renewable projects with ours, allowing all of us to become carbon offset traders who are collectively able to optimise the value of the credits we trade. As participants in the project, they derive their part of the proceeds of trading in carbon credits.
Aggregation is the ticket to success here: it is the cooperation of many for the benefit of all. It enables a much greater pool of renewable energy providers offering carbon offsetting, which is a critical (and underutilised) component in our efforts to battle climate change. It allows polluters greater opportunity to both offset unavoidable emissions and comply with carbon taxation, another state vehicle for driving down emissions.
Truth be told, however, apart from offsetting I also have my eye on carbon removal. Perhaps unsurprisingly, the star here is afforestation: the introduction of forests. But not with any old tree: our very own spekboom, a marvellous species that boasts exceptional carbon absorption properties, and is one of a tiny handful of plants globally that can also do this at night (a way of reducing its own water loss in the process).
Not many of us realise that only 150 years ago, the spekboom covered an estimated one million hectares in South Africa, primarily in the Karoo, creating an enormous carbon sink that also cooled our microclimate and conserved groundwater. But over time sheep and goats basically ate most of it, and we’ve lost those advantages.
Recreating the great spekboom forest as a carbon removal method in South Africa is thus entirely appropriate, and it has the potential to be a strong contributor to us achieving our country’s ultimate NDC target of net zero emissions by 2050. That’s easier said than done, when you consider that South Africa is the fifteenth-highest carbon emitter in the world.
The answer to climate change does not lie in just one response. It comprises many things, from harnessing the sun and wind for renewable energy to planting amazing trees that suck up carbon – and, crucially, to creating mechanisms for carbon emissions to be reduced and mitigated, and even eliminated. Offsetting is one of those mechanisms.
Avesh Padayachee is the founder and CEO of Fibon Energy, a renewable energy company dedicated to consciously clean electricity and a sustainable South Africa for all its citizens.