Panel recommends CDM board rejects Sasol’s carbon credit application

The United Nations Framework Convention on Climate Change (UNFCCC) methodologies panel, which reviews Clean Development Mechanism (CDM) project applications, has recommended that Sasol’s application to register its feedstock conversion project as a CDM project, be rejected.

Sasol said that it has noted the initial findings of the UNFCCC and would await the full report. “Once we have been able to review the detail of the findings we will consider our next steps,” spokesperson Jacqui O’Sullivan told Engineering News Online.

The proposed project would involve partial conversion of the company’s feedstock from coal to natural gas, which would be piped from Mozambique to the Sasol Synfuels Secunda facility in Mpumalanga. The feedstock is used for the large-scale manufacture of synthetic fuel, and Sasol has long used its commercialised coal-to-liquid fuel technology to produce fuel, and associated products for the domestic market. By using natural gas, instead of coal, Sasol argued that the project would result in a significant reduction of greenhouse gases.

The UNFCCC methodologies panel, which makes the recommendation to the CDM executive board, said that Sasol’s methodology was “neither well drafted, nor well organised”. It further stated that “the presentation of the calculation of emission reductions should be improved significantly”, along with a number of other suggestions regarding Sasol’s application.

This was the second submission from Sasol for the project, as the first application was rejected.

South African nongovernmental organisation (NGO) Earthlife Africa Johannesburg submitted public comment to the UNFCCC, arguing against Sasol being awarded CDM accreditation.

The NGO argued that the compulsory elements of additionality (proving that without carbon funding from the CDM, the project would not be viable) were not evident in Sasol’s feedstock conversion project. Earthlife Africa further said that Sasol had been investigating the conversion from coal to natural gas from Mozambique in 1999 - before the option of carbon financing was even available.

“The methodologies panel considers that the project proponents have not addressed fundamental issues in the proposed methodology. If the project proponents send a new submission on this case, the proposal must fully address all the issues identified by the methodologies panel for this case,” it said in its recommendation to the CDM executive board.

Earthlife Africa said that it agreed with the methodology panel’s finding. “The Meth Panel's rejection of the Sasol application means that the application fails at the first critical point of enquiry. Sasol is now required to start the process from the beginning, which would be its third attempt on this matter,” added the NGO.

“The UNFCCC's technical analysis has pointed out serious doubts regarding the additionality of Sasol's submission and glaring omissions in terms of emissions. For example, the UNFCCC states that Sasol did not include leakage from natural gas pipelines. This is critical as methane is 20 times more potent a greenhouse gas than carbon dioxide. We would strongly suggest that Sasol ends this charade and give up on the idea of gaming the CDM system,” emphasised Earthlife Africa energy policy officer Tristen Taylor.