The Carbon Tax Act (No. 15 of 2019) administered and collected by the South African Revenue Service, came into effect in South Africa on 1 June 2019. The Act requires companies to pay an annual environmental levy for GHG emissions if they exceed the set thresholds for their specific sectors.
Safripol classifies its activities under Intergovernmental Panel on Climate Change (IPCC) Code 1A2c for the Chemical sector which includes manufacture of plastics in primary forms. Safripol exceeds the threshold for the activities under IPCC Code 1A2c, which is 10 megawatts thermal net heat input design capacity, and therefore we contribute carbon tax for the stationary combustion of fuels at our sites. Our carbon tax liable emissions include stationary combustion of kerosene, diesel and methane-rich fuel at our Durban PET facility, and natural gas and diesel at our Sasolburg polyolefin facilities, which in the 2023 calendar year amounted to just under 25 000 tonnes CO₂e. A significant portion of our emissions, approximately 97%, stems from the use of methane-rich fuel for heating at our PET production plant. However, it’s important to note that the feedstock used for this process is more than 40% lower in carbon intensity compared to the energy sourced from the current South African electricity grid.
The cost of carbon pricing is expected to increase in South Africa in the coming years due to current carbon tax allowances being reduced or removed entirely. As a carbon taxpayer, and a responsible producer, Safripol prioritises reduction in our emissions from stationary equipment to effectively manage these escalating costs, as well as to meet our GHG emission reduction targets. This drives our focus on adopting low-carbon fuels for our Durban facility, as well as improving energy efficiency and exploring renewable energy solutions across our sites.
FAQs
Q1: What is the purpose and effective date of the Carbon Tax Act (No. 15 of 2019)?
A1: The Act came into effect on 1 June 2019 and requires companies to pay an annual environmental levy for GHG emissions if they exceed the set thresholds for their specific sectors.
Q2: What is Safripol’s classification under the Carbon Tax Act, and why does it contribute to the tax?
A2: Safripol classifies its activities under IPCC Code 1A2c for the Chemical sector. It contributes carbon tax because it exceeds the threshold of 10 megawatts thermal net heat input design capacity for the stationary combustion of fuels at its sites.
Q3: What was the amount and source of Safripol’s carbon tax liable emissions in the 2023 calendar year?
A3: Carbon tax liable emissions amounted to just under 25,000 tonnes CO2e in the 2023 calendar year. Approximately 97% of these emissions stem from the use of methane-rich fuel for heating at the Durban PET production plant.
Q4: How does Safripol manage escalating carbon pricing costs?
A4: Safripol prioritises reduction in emissions from stationary equipment to effectively manage escalating costs due to the expected reduction or removal of current carbon tax allowances.
Q5: What strategic areas are being focused on to reduce stationary equipment emissions?
A5: The focus is on adopting low-carbon fuels for the Durban facility, as well as improving energy efficiency and exploring renewable energy solutions across all sites.
Safripol’s Carbon Tax Management: See How Our Core Values Drive Action. Download the Sustainability Report