Systems integration specialist Jasco Group CEO Pete da Silva has urged companies to proactively determine their carbon footprint and implement measures to mitigate the eventual effects of a carbon tax.
This follows the release, in December, of the second Draft Carbon Tax Bill for public comment.
Da Silva notes that, as energy prices continue to rise, introducing an additional cost in the form of a carbon tax could have significant cost implications for businesses.
Section 5 of the draft Bill sets the rate of the carbon tax on greenhouse-gas (GHG) emissions at R120 for every ton of carbon dioxide or GHG equivalent emitted. An initial threshold of 60% has been proposed, below which no tax will be payable.
Da Silva notes that, if companies were to follow a proactive energy efficiency approach, they could potentially halve their carbon footprint, which would, in turn, significantly reduce their tax obligations, once the carbon tax is implemented.A
carbon footprint is the sum of all emissions of carbon dioxide and similar gases, induced by an individual or the activities of entities over a period. He notes that it can be measured and managed on an individual, organisational and national basis.
Da Silva says that Jasco, which “eats its own dog food”, implements its solutions before recommending them to clients. To reduce its carbon footprint, the company replaced its entire vehicle fleet with vehicles equipped with 1 200 cc engines to reduce fuel consumption, and retrofitted its headquarters by replacing all the incandescent lights with light-emitting-diode lights, and installing smart lighting and air-conditioning systems. These smart systems were linked with biometrics solutions to ensure that the systems would operate only while staff were on the premises.
He notes that these types of energy interventions are often required prior to the implementation of alternative renewable-energy solutions such as solar photovoltaic (PV) solutions.
Da Silva notes that a very effective solution (in terms of consumption and cost) is solar PV projects that can be located in a section of a company’s real estate that does not generate any benefit in terms of revenue, such as a car park or extensive lawns. Following the building retrofit, Jasco installed several solar PV panels on the roof of the car park.
Jasco’s 150 kW PV solution has reduced the company’s carbon footprint by about 50%, with the initial retrofit accounting for a reduction of about 20%. The PV solution is grid-tied, and the company draws power from City Power during the early mornings and in the evenings, but uses solar “when it is available”, Da Silva explains. He notes that the energy produced on weekends is fed back into the grid.
He stresses that implementing a solar or renewable solution is just one part of an energy efficient approach. “Most people think ‘green’ is using solar or other renewables to reduce energy consumption . . . but, if we hadn’t retrofitted the building or changed our fleet, we would’ve needed 20% more car park space to realise the same carbon reduction,” explains Da Silva.
He believes that a carbon tax, together with ever-increasing electricity costs, will drive the implementation of energy-efficient and carbon-reduction strategies. “Electricity is already expensive and, if you have to pay tax on top of that, you’re going to find ways of limiting your consumption.”
Da Silva says South Africa has always been too reactive: “. . . something has to hit us before we change”. However, he believes that corporates that are too slow to react or those that fail to act ahead of the carbon tax implementation will experience debilitating energy costs.
Da Silva says he is satisfied with the draft Bill in its current form, but that his main gripe is that the revenue generated from this eventual tax is unlikely to be used to improve or rectify issues relating to carbon emissions.
Government’s insistence that levies be paid into the fiscus, while perhaps limiting misappropriation to a degree, also results in the revenue generated from carbon tax probably not being used for projects or initiatives aimed at meaningfully reducing carbon emissions, he elaboragtes.
South Africa’s efforts to reduce emissions are largely negated by the presence of old coal-fired power stations, Da Silva states. He proposes that the carbon tax revenue be ringfenced and used to improve or shut down these power stations, reskilling workers so that they may be employed at energy producers using cleaner technologies.