NATIONAL CLIMATE CHANGE RESPONSE

GREEN PAPER 2010

Parliamentary Portfolio Committee on Water and Environmental Affairs

16TH March 2011

Dr Dhiraj Rama

CONTENTS

Introduction ACMP

Presentation Overview

Cement Sector Case Study

Recommendations

Conclusions

INTRODUCTION: Who are the ACMP?

The ACMP acts as an umbrella body for six South African clinker and

cementitious material producer companies, specifically guiding and

representing their interests in the fields of environmental stewardship, health and safety practices, and community and stakeholder interaction

The ACMP’s member companies include:

AfriSam: www.afrisam.comLafarge South Africa: www.lafarge.comNPC-CIMPOR: www.cimpor.comPretoria Portland Cement Company Ltd: www.ppc.comCemlock(Gauteng) Pty LtdI.D.M. Cement (Pty) Ltd): www.vibro.co.za

OVERVIEW

Principles of the Green Paper supported by the ACMP

The ACMP are in support of a sectoral approach to climate change

BUT The cement sector do face challenge in implementing their climate change

strategies. The aim of this presentation is :

Firstly, to provide an overview of the cement industry and historic GHG

mitigation

Secondly to highlight challenges to GHG reduction and provide

recommendations on how they may be overcome

SECTORAL APPROACHSECTORAL APPROACHA CASE STUDYA CASE STUDY

CEMENT SECTORCEMENT SECTORG

HG

Em

issi

on

s

Electricity

Limestone: 50%

Material Handling e.g. transport from quarry to factory

Coal: 35%

Extenders

AFR

EE: Energy

efficiency

Transport

DEPENDENCY

Rail freightEE: finance & technology

Extenders: Waste definition: unintended consequence of waste definition

Regulatory decision making: Thermal policy

OPPORTUNITIE

OPPORTUNITIE

SS

RISKS: INFRASTRUCTURE PROJECTSJOBS VS IMPORTS

Target setting

Rational approach

Production cut

CHALLENGESCHALLENGES

GHG MITIGATION OPPORTUNTYGHG MITIGATION ALREADY IMPLEMENTED

Recommendation 1

Targets vs. Benchmarks

GHG emission trends: Recognition of previous and current effort

Less limestone (extenders used)Less coalLess electricity

Recommendation 2

Remove legislative barriers that are counter-productive to GHG reduction

BARRIERS: Legislation: E.g. Waste Act

Waste definition: unintended consequences: A number of materials conventionally used internationally and locally

with consequences to GHG emission reduction now potentially and intriguingly renders cement as waste in RSA due to unclear definitions in the Waste Act,

International and local business risk: cement classified as waste Discourages use of slags / fly ash / boiler ash/ synthetic gypsum etc

resources: main contributors to GHG mitigation Waste definition must be reviewed urgently:

Role of Government to ensure appropriate supply chains to manage efficient response to climate change commitment

BARRIERS: Regulatory delay: Eg. Waste Tyre Regulations

13 February 2009 : Waste Tyre Regulations -13 February 2009 (GN149).

24 July 2009 : Department’s high temperature thermal treatment policy -24 July 2009

5th April 2010 : Tyre waste management plan - 5th April 2010 -to date not been approved

March 2011: status unknown. This example clearly demonstrates the role of Government to ensure appropriate supply chains to manage efficient response to climate change

Consequence:. the unnecessary use of coal, a rapidly depleting resource:

The cement producers unable to avoid CO2 emissions attributed to coal. Approximately 13 million waste tyres generated annually (=225,000 tons ).

Implementation would have promoted sustainable development principles (reduce use of natural

resources) avoided adverse impact on ambient air quality through burning of tyres and

consequences to public health

Further example of delays is the lengthy period required by authorities to authorize the EIA’s for co-processing of AFR and the issuing of waste licenses

Recommendation 3

Addressing the rail transport inefficiencies

RAIL TRANSPORT

Role of Government to ensure appropriate supply chains to manage efficient response to climate change commitment to transport of goods by rail

Road freight: key contributor to GHG emission Many businesses rely on road freight due to its access and

reliability Establish an efficient sustainable rail network

Sectoral approach required: Eg. Cement producers: the specific needs regarding both

infrastructure and service level agreements will have a significant positive impact on managing its carbon footprint.

Recommendation 4

Economic instruments for a low carbon economy

CARBON PRICING

Carbon pricing: Establishing a realistic price on carbon is a key factor to cost effective climate action

Accurately price carbon: Encourage the pro-active adoption of low carbon technologies

Carbon revenue: Focus the funds generated by a carbon price on the mitigation of carbon

emissions

Recognition of previous and current effort Signatory to the Energy Accord Use of alternate fuels

CARBON PRICING AND ECONOMIC INSTRUMENTS

Benchmarking economic instruments: Socio-economic impact assessment:

BRIC countries Energy mix Economic growth goals and targets

Efficacy of incentives vs taxes Carbon tax at present is not a good solution as it would severely impact on

the cost of doing business with consequences to the public use of a combination of different economic interventions

Benchmarking emissions: absolute vs specific values

Discount objectively the notion that major policy and action plans to address energy intensity would not suffice before confirming the carbon tax approach

RECOMMENDATION 5

White Paper

WHITE PAPER

ACMP SUPPORT DEVELOPMENT OF THE WHITE PAPERGovernance framework

Ensure progress towards implementation: Eg. National Strategy on Sustainable development Government actions/governance mechanisms:

Enhance efficient regulatory processes: Examples: Efficient permitting, compliance monitoring and enforcement of legislations

such as the Air Quality Act and the Water Act.

Improving capacity and capability of the government Departments to ensure efficient service delivery. Many actions described in the Green Paper are already related to current regulatory requirements (example Water use and discharge; agriculture management, etc).

The format be amended to deal with matters thematically: Ensures an accurate reflection of the processes already in place in South Africa. Identifies policies and programs that are already in place , but require improved

implementation or mainstreaming climate change response during implementation National strategy on sustainable development:

Must be referred to and referenced. Catalyze alignment of the different polices, programs and plans in the country

and must be a key outcome of the review processes reflected in the Green paper

Management of risk: Avoid unintended consequences: Socio economic state of RSA Trade barriers

CONCLUSION

In light of the government commitments, the ACMP endeavours to support the national initiatives to enable the country to reach the targets set, namely 34% by 2020 and 42% by 2025

Avoid unintended consequences: greenhouse gas reduction strategy does not compromise South Africa’s competitiveness and employment conditions

While focusing on these targets, adaptation strategies need to be addressed by mainstreaming it in all key government departmental policies, plans and programs

Address trade barriers