Pricing Carbon: Carbon Emission Trading Potential in South Africa

1
Pricing Carbon Carbon Emission Trading Potential
in South Africa

• Proposed Research Papers

2
Research Papers

• Carbon tax versus emissions trading
• Emission trading scheme design
• Use of carbon revenue
• International carbon reduction policies
• Trading scheme costs and administration
• Carbon Offsets
• Consultation and Policy Context
• Summary A South African emissions trading scheme?

3
Research Papers

• Carbon tax versus emissions trading
• Review of carbon taxation
• Comparison of tax versus trading
• Administrative implications
• Efficiency implications
• Environmental implications
• South African policy considerations
• Tax incidence
• Market structure
• Emission trading scheme design
• Comparison of emission trading scheme design and
  design elements
• Key design elements and comparisons (allocations,
  trading rules..)
• Implications for South Africa
• Use of carbon revenue
• Scale of revenue
• Use of revenue and fiscal considerations
• Hypothecation and revenue recycling
• Mitigating impacts on households and businesses
• South African policy considerations

4
Research Papers

• International carbon reduction policies
• Cross country comparison of strategies
• Current inter-linkages of schemes
• Merits of tax vs. trading with regards to future
  links
• Future global carbon market prospects
• Trading scheme costs and administration
• Costs estimates of trading schemes
• Monitoring and enforcement requirements
• Trading and trading platform requirements
• Comparison with other policy options
• Legal requirements
• Capacity requirements
• Carbon Offsets
• Review of the voluntary markets in relation to
  trading schemes
• Policy issues related to the use of offsets and
  the cdm
• Consideration of the level to which offsets could
  be used in SA Africa

5
Research Papers

• Consultation and Policy Context
• Current South African policies and the
  relationship of these to a trading scheme
• Summary of stakeholder views and perceptions
• Relationship of a domestic scheme to the CDM and
  to SAs position in the global climate change
  negotiations
• Will require structured consultation or at least
  interviews with the top 20 emitters and key
  departments.
• Possibly with the ERC
• Summary A South African emissions trading scheme?

6
Cross-Cutting Considerations

• Distributional implications
• consumers
• producers
• revenue use and mitigating impacts
• Market Structure
• implications of SAs specific market structure
  for both ET and taxation
• Coverage
• addressing energy intensive sectors
• addressing competitiveness
• coverage of distributed emissions transport,
  households, agriculture, waste
• Timing
• when should approach be initiated
• stability and certainty
• relationship to large fixed investments