Climate Reality Project counts carbon costs

Brand South Africa
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October 24th, 2013

Generation Earth Founder Ella Bella and Miss Earth South Africa executive director Catherine Constantinides facilitated a Skype call with Climate Reality chairperson and former US vice president Al Gore.

Miss Earth South Africa 2013, Ashanti Mbanga, lends her voice in the fight against climate change.

Pandelani Dzhugudzha from the Department of Environmental Affairs with Ella Bella, Miss Earth South Africa educational officer and Generation Earth founder.
(Images: Generation Earth)

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South Africa Climate Reality Project representatives, Ella Bella and Catherine Constantinides, hosted a live Skype call with former United States vice president, Al Gore, to highlight the relationship between carbon pollution and climate change.

The live broadcast formed part of the project’s annual 24 Hours of Reality. This year’s event was held on 23 October in Rosebank, Johannesburg. Content aggregation tool Reality Drop was also launched.

The official event kicked-off on 22 October and featured expert discussions, presentations and educational sessions from across the globe.

The global awareness drive, spearheaded by leading environmental advocate and Nobel Laureate Gore, is aimed at educating the public about the “true cost of carbon”.

During the Skype call, he addressed climate-related issues specific to Africa and South Africa as well as highlighting key points relating to the “global cost of carbon”.

These were later discussed in more detail by Constantinides when she and Bella delivered Climate Reality Project’s official presentation, first released to delegates at the Climate Reality Leadership Corps Conference in Istanbul, Turkey, in June.

Constantinides picked up on Gore’s points in the Climate Reality Project presentation, which focused on drought and its consequences – including famine – rising food prices and food shortages, as well as the cost of South Africa’s coal-dependent energy sector and the effects of increasingly erratic global weather patterns.

“The effects of climate change are felt every day, across the globe, from steadily increasing average temperatures to the rising levels of the world’s oceans, and yet climate change is still considered to be a notion concocted by scientists and environmentalists as opposed to a reality facing global citizens,” said Constantinides, also Miss Earth South Africa’s executive director.

“Everywhere one looks one can see climate change in action; rising global temperatures have led to an increase in the water temperature of the world’s oceans, which in turn leads to warmer water being absorbed into the air through evaporation; warmer air is able to hold a greater volume of water vapour, which is causing more severe, more intense storm systems across the globe.

“Hurricanes the likes of which have never been seen before are tearing through equatorial regions, tropical storm systems stronger than any other storm systems in recorded history are wreaking untold damage across the globe, areas that were once unaffected by tropical storms are now falling prey to these ‘super storms’ because the air temperature of the region has increased by just a few degrees.”

According to the Climate Reality Project, for every 1°F (-17.2222vC) temperature increase, the incidence of heavy rains increases by about 4%.

“Climate change does not only mean more severe storms, however, it can lead to more severe droughts, food shortages, famine, wild fires, increase in diseases etc. All of these effects of climate change can be seen across the globe,” she said.

South Africa’s carbon footprint

South Africa ranks among the top 20 polluters globally and is responsible for more than 40% of Africa’s carbon emissions. In 2010, South African industry emitted some 500-million metric tons of greenhouse gasses.

The majority of South Africa’s energy is produced by burning fossil fuels, meaning the top 40 largest companies in the country were responsible for some 207-million tons of carbon dioxide emissions, directly emitting 20% of South Africa’s carbon output. Every time fossil fuels – gas, coal or oil – are burnt, carbon dioxide is released into the atmosphere. The 10 hottest years in recorded history in the country have all been in the past 15 years.

In a white paper released in February 2012, the South African government proposed a crackdown on big polluters with a new carbon tax on companies’ carbon emissions. According to experts, this is what the country needs to save itself from potentially catastrophic climate changes such as rising temperatures, droughts and extreme rainfall.

Government has also considered a tax rate of R75 per ton of CO², rising to approximately R200 per ton. This is considered to be “feasible and appropriate to achieve the desired behavioural changes and emission reduction targets”.

According to a report by Trucost, a research group that helps businesses understand environmental risk, carbon costs could amount to almost US$974-million (R9 510 836 458) if the top 40 largest companies were to pay the carbon tax rate of R75 (US$8.97) per ton of CO²e (CO² equivalent)for direct operational emissions globally. This would equate to 0,2% of revenue, or 1% of earnings before interest, taxation, depreciation or amortisation (EBITDA) on average across all 40 companies.

At a higher future carbon price of R200 (US$23,91), direct carbon costs could amount to more than US$2,5 billion globally. This could equate to 0,5% of revenue on average across all 40 companies, or 2,7% of earnings.

In a bid to address the initial concerns raised by businesses, the South African treasury proposed a 60% tax-free threshold on emissions for all sectors, including electricity, petroleum, iron, steel and aluminium. Plans state that the levy would increase by 10% a year until 2020, while all sectors bar electricity will be able to claim additional relief of at least 10%.

Of all 13 recognised sectors in the South African FTSE/JSE 40 Index, only five key sectors – basic resources, oil and gas, food and beverage, industrial goods & services and telecommunications – accounted for 97%of total emissions from the top 40 companies.

Liesel Van Ast, research editor at Trucost, highlighted potential negative effects on companies: “Protecting energy and carbon-intensive industries to the extent that business-as-usual (BAU) greenhouse gas emissions continue could weaken BASIC ministerial climate negotiations and exacerbate climate change impacts such as changes in water availability, increased floods and droughts, biodiversity loss and crop losses or lower agricultural production in South Africa.”

Companies with carbon-intensive operations, products or supply chains will be concerned about their ability to compete against lower carbon sector peers in South Africa, or against competitors in countries that do not price carbon yet. This could in turn limit their ability to pass on some or all of the tax to business customers or consumers.

Constantinides urged delegates to join the fight against climate change and encouraged them to join the movement started by Gore in 2006 when he launched the documentary, An Inconvenient Truth, which focusses on his campaign to educate citizens about global warming.

“Now is the time for global citizens to stand together and fight to mitigate the effects of climate change,” said Constantinides.

About The Climate Reality Project

The Climate Reality Project is a non-profit organisation centred on education and advocacy related to climate change. Established in July 2011, the project is the joint venture of The Alliance for Climate Protection and The Climate Project, both founded by Gore.

The first 24 Hours of Reality was held in 2011; broadcast live online it featured 24 presenters across 24 time zones presenting in 13 languages. The presentations stressed a link between climate change and oil and coal producers, with the webcast garnering 8-million views and a Silver Lion at the 2012 Cannes Lions International Festival of Creativity.

The project also released several short videos, including Doubt, Climate 101 and Grassroots at the event.

A second webcast; 24 Hours of Reality: The Dirty Weather Report, was broadcast in 2012, and focussed on the effects coal, oil and gas pollution have on weather patterns. Attracting
14-million unique viewers and a viewership of more than 16-million, the webcast set a Ustream record for the most online viewers in a 24-hour period.

It also won 10 Telly awards in 2013, including two silver Telly awards in the News Feature and Social Responsibility categories and seven bronze Telly awards.

Miss Earth South Africa and Generation Earth run campaigns to involve the public in the climate change conversation through educational workshops in schools across the country, “because the cost of carbon is high but the cost of inaction is even higher, and we, as global citizens, must work to minimise our collective carbon footprint,” said Constantinides.