Energy and chemicals group Sasol reports that it has secured more than 100 000 carbon credits in a transaction concluded under the South African Carbon Offset Administration System (COAS), set up to facilitate the listing, transfer and retirement of such credits to offset carbon tax liabilities.

In a statement the JSE-listed company said the transaction had been concluded with Bethlehem Hydro, a South African independent power producer (IPP), and that it was among the first concluded under COAS, which was launched earlier this year.

The 7 MW Bethlehem Hydro IPP has, to date, generated 383 GWh of emission-free electricity, equivalent to a reduction of 350 000 t of carbon dioxide (CO2), Sasol said.

Bethlehem Hydro’s Anton-Louis Olivier reported that the Free State hydropower facility was the first IPP to be granted a generation licence in South Africa in 2005 and was also in the first batch of domestic projects to be registered under the Clean Development Mechanism (CDM) of the United Nations Framework Convention on Climate Change in 2009.

Under South Africa’s carbon tax regulations, companies are able to buy carbon credits, including CDMs, from third parties to offset a portion of their carbon-tax liability.

Climate Change VP Shamini Harrington said Sasol was committed to reducing its operational greenhouse gas emissions profile through various mitigation activities, including carbon offsets.

Sasol’s coal- and gas-to-liquids production processes in Sasolburg and Secunda are highly carbon-intensive and the group has committed to reducing greenhouse-gas emissions from the 63.9-million tons of carbon dioxide equivalent (CO2e) emitted in 2017 to 57-million CO2e tons by 2030.

It is coming under increased pressure to accelerate the pace of its decarbonisation, however, and is currently finalising a reduction plan to 2050, to be released at its Capital Markets Day in 2021.

Earlier in the month, Sasol indicated that it planned to issue a request for information for the development and implementation of carbon-offset projects in South Africa and the Southern African Development Community and called on potential participants to register their interest by mid-November.

In parallel, the company intends pursuing wind and solar projects with a combined capacity of between 200 MW and 300 MW and is seeking to identify potential partners for the development and demonstration of technologies that can utilise the CO2 produced at its South African operations.