It is important that the South African government legislates or provides incentives for a reduction in carbon emissions in the near future, says climate change specialist Imbewu lawyer and director Andrew Gilder.
Gilder says that many companies seem reluctant to take voluntary steps to reduce their emissions, such as investing in Clean Development Mechanism (CDM) projects. A CDM project permits an entity in South African to implement a project activity that results in greenhouse-gas emissions reductions and contributes to sustainable development, thus (potentially) earning carbon credits.
Gilder notes that if there is to be a more effective national commitment to combat climate change, there needs to be stronger government intervention in some shape or form, with a wide range of different strategies working towards the same goal. He comments that, at present, the South African government correctly encourages ‘behavioural change’ in companies’ stance towards the climate change issue, preferring to avoid having to promulgate and enforce climate change-specific legislation.
Despite there currently being limited climate change-related legislation on the South African statute book, it is likely that in the near future government will decide to be more specific and practical on the issue, and enforce stricter controls on greenhouse-gas emissions, comments Gilder. It is, therefore, essential for companies to view their carbon emissions in a serious light, he says.
If carbon emissions were to be regulated, the legislation would need to adopt a holistic approach, including tax incentives for companies buying or making use of environment-friendly products or services, says Imbewu environmental legal consultant Marie Parramon.
Parramon says that any future commitment taken by South Africa towards combating climate change will be influenced by the pending negotiations for a post-2012 international climate-change regime. The first commitment period of the Kyoto Protocol expires at the end of 2012 and the country will need to assess the level of commitment it can make towards combating climate change in the post-2012 period, she notes.
Country parties to the United Nations Framework Convention on Climate Change are categorised either as Annex I (develop-ed countries), or as Nonannex I (developing countries). In terms of the Kyoto Protocol, Nonannex I countries are not obliged to commit to emissions reductions, while Annex I countries, taking into consideration their greater contribution to human- induced climate change, bear more responsibility to combat the phenomenon, including commitments to reducing their carbon emissions according to a set of quantified targets. As a developing country, South Africa constitutes a Nonannex I party without a quanti- fied emissions limitation and reduction target.
Parramon comments that from a business perspective, South African companies would benefit by being more alert to the potential offered by carbon mitigation projects, such as CDM projects.
“Investing in CDM projects is not only an environmental issue. As we move towards a carbon-constrained economy, not investing in reducing a company’s carbon footprint is likely to impact on that company’s future finance, investment prospects, and general functioning.”
The Carbon Disclosure Project (CDP) is an example of how access can be gained to information on companies’ carbon footprints. The CDP is a nonprofit organisation, representing a pool of investors, that collects information on the carbon-related business activities of the top companies in industry, and annually invites companies to fill in a questionnaire relating to their activities and greenhouse-gas emissions. Companies that refuse to participate run the risk of having their refusal being reported negatively in the media, which could hurt their businesses, says Gilder.
Gilder believes that companies need to be more proactive than reactive if they are to be successful in combating the effects of climate change, by sensitising themselves more to the issue, and taking appropriate action. He adds that adaptation and mitigation are the main arenas for combating climate change.
Gilder says that climate change has become a widely accepted reality, as reported upon by the Intergovernmental Panel on Climate Change in its ‘Fourth Assessment Report’. Sir Nicholas Stern, who published a review of the economics of climate change in 2006, further illustrates the impact of climate change. During his visit to South Africa last year, says Gilder, Stern raised two important points regarding climate change.
The first point Stern raised, he says, is that climate change cynics can be relegated to the “lunatic fringe”, and that human-induced climate change is perceived as a reality. The second idea Stern raised is that the concept of ‘global warming’ is less useful than the concept of climate change. The reason for this is that climate unpredictability, as a whole, will be the hallmark of damage to the environment, not only higher temperatures. Gilder adds that while climate change may not be the direct cause of a specific weather event, it is likely that the phenomenon can contribute to the severity of such events, such as is thought to be the case with Hurricane Katrina, which caused untold damage in 2005 in New Orleans, in the US.
Imbewu is a sustainability legal consultancy, employing five lawyers (four of whom are South African attorneys), each with a background in an aspect of environmental, health and safety or climate change law. It is considered a ‘boutique’ practice, as it focuses on a specific area of sustainability law. Imbewu has a number of large South African companies, as well as municipal, provincial and national governments, amonge its clients.
Examples of Imbewu’s work include providing legal advice to companies conducting environmental-impact assessments. Often, companies are unfamiliar with the intricacies of the relevant law and will need to learn the environmental protocol from scratch, which presents challenges, says Gilder. The climate change legal regime, he notes, is an excellent example of this situation.
“The climate change legal regime is evolving all the time. It is, therefore, completely different from practicing in other legal disciplines, such as matrimonial law, in which the actual rules of the game do not change as rapidly as the rules under- pinning the climate and CDM legal regimes.”
Imbewu also provides a wide range of sustainability legal advice, as well as commercial advice on purchase and sale agreements for carbon credits, the associated rules of CDM projects and their interaction with the domestic law, and broader strategic advice on climate change policy and strategy develop- ment. An example of the latter occurred last year, when Imbewu cowrote a strategy for the Central Energy Fund for the development of a carbon business unit.