Decarbonisation and Compliance: Assessing the impact of the Climate Change Act on South Africa’s extractives industry

The Climate Change Act establishes a regulatory framework for decarbonisation in South Africa's extractives sector, mandating sector-specific emissions targets, carbon budgets, and reporting. While the mining industry is vital to the economy, it is a major GHG contributor, with 85% of emissions linked to the coal value chain. The report highlights challenges such as enforcement gaps, resource limitations for monitoring, and the high capital cost of transitioning. It emphasizes that compliance is a strategic necessity for maintaining export market access, particularly regarding EU CBAM requirements. The Green Transport Strategy (2017-2050) is identified as a key tool for reducing logistics emissions by shifting from road to rail. A case study of Anglo American illustrates effective adaptation through green hydrogen trucks and internal carbon pricing. Successful implementation requires collaboration between government, mining companies, investors, and civil society to ensure a just transition.

• The Climate Change Act introduces a regulatory framework for the extractives sector featuring sector-specific GHG reduction targets, mandatory annual monitoring and reporting to the National GHG Inventory, and carbon budgets with penalties for non-compliance.
• South Africa's mining industry is a major source of greenhouse gas emissions, with the coal value chain accounting for nearly 85% of the country's total GHG emissions.
• Compliance with the Act is critical for mining companies to maintain access to international markets, specifically to meet the requirements of the European Union's Carbon Border Adjustment Mechanism (CBAM).
• Implementation of the Act faces several hurdles, including inconsistent enforcement in resource-poor regions, a lack of capital for emissions monitoring infrastructure, and the risk of companies relocating high-emission processes to countries with laxer laws.
• The Green Transport Strategy (2017-2050) aims to reduce transport emissions—which comprise about 10% of South Africa's total—by upgrading to electrified rail and shifting freight from road to rail.
• Anglo American serves as a model for adaptation, targeting carbon neutrality by 2040 by converting approximately 400 diesel trucks to green hydrogen and utilizing internal carbon pricing in its investment strategies.
• The coal sector presents unique challenges due to its continued significance in the national energy mix and the long-term nature of the capital investments required for decarbonisation.

APA

Obisie-Orlu, V. (n.d.). Decarbonisation and Compliance: Assessing the impact of the Climate Change Act on South Africa’s extractives industry. Good Governance Africa. https://digitalmallblobstorage.blob.core.windows.net/wp-content/2024/11/Decarbonisation-and-Compliance-IR.pdf

Chicago

Obisie-Orlu, Vincent. Decarbonisation and Compliance: Assessing the impact of the Climate Change Act on South Africa’s extractives industry. Good Governance Africa, n.d. https://digitalmallblobstorage.blob.core.windows.net/wp-content/2024/11/Decarbonisation-and-Compliance-IR.pdf.

Wikipedia

{{cite report |last1=Obisie-Orlu |first1=Vincent |title=Decarbonisation and Compliance: Assessing the impact of the Climate Change Act on South Africa’s extractives industry |publisher=Good Governance Africa |url=https://digitalmallblobstorage.blob.core.windows.net/wp-content/2024/11/Decarbonisation-and-Compliance-IR.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{obisieorlunddecarbonisation, author = {Obisie-Orlu, Vincent}, title = {{Decarbonisation and Compliance: Assessing the impact of the Climate Change Act on South Africa’s extractives industry}}, institution = {Good Governance Africa}, url = {https://digitalmallblobstorage.blob.core.windows.net/wp-content/2024/11/Decarbonisation-and-Compliance-IR.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }