Browsing by Subject "Carbon taxes"

Now showing 1 - 8 of 8
  • Thumbnail Image
    Item
    Open Access
    Analysis of the economic implications of a carbon tax
    (Energy Research Centre, University of Cape Town., 2009) Winkler, Harald; Marquard, Andrew
    The aim of this paper is to provide an overview of the implications and impact of a carbon tax in the South African context – it aims to serve as an introduction rather than an exhaustive analysis, and therefore does not draw any comparative conclusions on the suitability of a carbon tax by comparison with alternative instruments such as cap and trade systems. Before turning to the specific topic of this paper, a carbon tax, some background is given to broadly on economic instruments and carbon markets. Following this, existing attempts to model the impact of a carbon tax on the South African economy are discussed, followed by a discussion on policy challenges and some existing proposals.
  • Thumbnail Image
    Item
    Open Access
    Comments on the Carbon Offsets Paper issued by National Treasury in April 2014
    (Energy Research Centre, University of Cape Town., 2014) Energy Research Centre
    While this is not the paper on a full emissions trading scheme (ETS) that had been indicated, comments are provided on the narrower focus of domestic offsets. The design is closely allied to Treasury’s design of a carbon tax as set out in a policy paper (National Treasury 2013), with domestic carbon off-sets designed to reduce tax liability by up to 10%, for activities not covered by the tax. ERC has commented separately on the tax policy, and the present comments should be read together with those comments. The finding that carbon offset projects can generate significant local sustainable development benefits (p. 16) should be treated with caution. The experience with the CDM has been mixed, as assessed for example in (Ellis, Winkler, Morlot & Gagnon-Lebrun 2007). Market mechanisms generally favour low-cost reductions, and require clear policy guidance and / or financial incentives to deliver additional benefits.
  • Thumbnail Image
    Item
    Open Access
    Comments on the Carbon Tax Policy Paper issued by National Treasury in May 2013
    (Energy Research Centre, University of Cape Town., 2013) Energy Research Centre
    Our analysis of the carbon tax as proposed in Treasury’s policy paper is that it is both low relative to the required task and includes a complex set of exemptions. The effective tax rate of R12-48 / t CO2-eq is too little to transform South Africa’s energy economy, and does not make a sufficient contribution to bending the curve of our national greenhouse gas (GHG) emissions, so that it starts following a benchmark ‘peak, plateau and decline’ GHG emission trajectory, as set out in our climate policy (RSA 2011).
  • Thumbnail Image
    Item
    Open Access
    A critical review of South Africa’s Carbon Tax Policy Paper: recommendations for the implementation of an Offset Mechanism
    (2013-12) Newham, Melissa; Conradie, Beatrice
    The South African government has emphasised the need for ‘developing country’ solutions to climate change that simultaneously pursue GHG reductions and socioeconomic development. To encourage the transition to a low-carbon economy the National Treasury has proposed a carbon tax and offset mechanism to be introduced in 2015. The practical delivery of the offset scheme remains uncertain. This paper investigates which features and governance structure would be desirable for such a mechanism in South Africa. Primary research is conducted into the South African voluntary carbon registry; Credible Carbon. The questions asked by this paper are: Should firms be allowed to offset emissions? What is the ideal way to implement offsets in South Africa? This paper concludes that Credible Carbon provides a good model for carbon trading that can be scaled up to meet demand under the new regulations. However, government needs to ensure that projects continue to deliver acceptable social benefits and that carbon auditors are well-trained and accountable.
  • Thumbnail Image
    Item
    Open Access
    Modelling the impact of CO2 taxes in combination with the Long Term Mitigations Scenarios on Emissions in South Africa using a dynamic computable general equilibrium model
    (Energy Research Centre, University of Cape Town., 2008) Kearney, Marna
    A dynamic computable general equilibrium (CGE) model is used to analyse the impact on the economy of taxes on CO2 emissions combined with the Long Term Mitigation Scenarios. A sales tax is used to model the impact of a CO2 tax. The mitigation scenarios modelled include structural shifts (for example switching from coal-fired electricity plants to nuclear power stations), changes in energy efficiency and changes in investment required. The extent of the structural shifts, changes in energy efficiency and investment required differs from scenario to scenario. The results for the mitigation scenarios indicate that the mitigation scenarios have a positive impact on GDP when investment is large. Although economic activity initially declines due to improved energy efficiency, it is followed by a period of economic expansion as lower prices increases output in most industries – this is especially the case when it is combined with higher investment. When CO2 taxes are levied the economic impact is again positive if this is combined with either tax relief or reinvestment of the additional tax revenue. The scenarios have varied impact on labour, in general employment for semi- and unskilled labour rise if investment is higher. In most scenarios the demand for energy declines, especially for coal and petroleum. However, the demand for electricity increases if investment rises significantly. When the mitigation scenarios is combined with a CO2 tax the results indicate that the CO2 tax is effective in reducing output of CO2 producing industries as it changes the relative price of the commodities produced by these industries. However, the sales tax is distortionary as it introduces price wedges in the economy while consumers may end up paying large portions of the tax. A CO2 tax may not be the most appropriate tool to achieve the desired results considering the economic development objectives of South Africa. However, when combined with the LTMS framework its negative impact is negated by higher investment and GDP growth.
  • Thumbnail Image
    Item
    Restricted
    A new scenario framework for climate change research: scenario matrix architecture
    (Springer, 2014) Van Vuuren, Detlef P; Kriegler, Elmar; O’Neill, Brian C; Ebi, Kristie L; Riahi, Keywan; Carter, Timothy R; Edmonds, Jae; Hallegatte, Stephane; Kram, Tom; Mathur, Ritu; Winkler, Harald
    This paper describes the scenario matrix architecture that underlies a framework for developing new scenarios for climate change research. The matrix architecture facilitates addressing key questions related to current climate research and policy-making: identifying the effectiveness of different adaptation and mitigation strategies (in terms of their costs, risks and other consequences) and the possible trade-offs and synergies. The two main axes of the matrix are: 1) the level of radiative forcing of the climate system (as characterised by the representative concentration pathways) and 2) a set of alternative plausible trajectories of future global development (described as shared socio-economic pathways). The matrix can be used to guide scenario development at different scales. It can also be used as a heuristic tool for classifying new and existing scenarios for assessment. Key elements of the architecture, in particular the shared socio-economic pathways and shared policy assumptions (devices for incorporating explicit mitigation and adaptation policies), are elaborated in other papers in this special issue.
  • Thumbnail Image
    Item
    Open Access
    Putting a price on carbon: economic instruments to mitigate climate change in South Africa and other developing countries
    (Energy Research Centre, University of Cape Town., 2010) Winkler, Harald; Marquard, Andrew; Jooste, Meagan
    There has been extensive debate among researchers in developed countries whether an emissions trading scheme or carbon tax is the best means to ‘put a price on carbon’. Other economic instruments could contribute to mitigation of greenhouse gas emissions indirectly, including tradable certificates for renewable energy or energy efficiency. The conference organisers intended to take up the debate on how such instruments might apply in South Africa and other developing countries, putting carbon pricing in the context of broader policy on climate and development. This has not been done in depth previously.
  • Thumbnail Image
    Item
    Open Access
    Socio-economic implications of mitigation in the power sector including carbon taxes in South Africa
    (Energy Research Centre, University of Cape Town., 2014) Merven, Bruno; Moyo, Alfred; Stone, Adrian; Dane, Anthony; Winkler, Harald
    The structure of this paper is as follows. The first section provides a discussion of recent developments within South Africa aimed at increasing the contribution of renewable energy. The second section gives a brief description of the carbon tax that National Treasury plans to implement and also provides an overview of previous studies on the implications of a carbon tax in South Africa. The linked model that we use for our analysis is described in section 3. This is then followed in section 4 by a description of the scenarios that we modelled, with results presented in section 5. The last section presents the conclusions and recommendations for further research.