We are pleased to present the second quarterly “Data and Insights” brief for South Africa, which includes up-to-date cumulative data on VCS activity in the country as well as information about recent trends through December 2020.
Under South Africa’s Carbon Tax Act, tax-liable entities can satisfy up to 10% of their tax obligations by purchasing carbon offsets. Verra’s Verified Carbon Standard (VCS) Program is recognized as an accredited standard under this regulation, and entities with tax obligations can use Verified Carbon Units (VCUs) to cover a portion of their tax liability. As the first Carbon Tax payments for the 2019 tax year were due by 30 October 2020, VCU issuances picked up significantly prior to that date.
More information is available at:
Despite the pandemic, which has impacted most economic sectors, the total number of VCUs issued from projects in South Africa increased considerably in 2020: from over 75,000 VCUs in 2019 to almost 1,200,000 VCUs in 2020.
While 2020 generally saw more VCU issuances than 2019, Q4/2020 — when the first tax payments for the tax year of 2019 were due — saw by far the biggest increase; this indicates that the launch of the carbon offset mechanism was the driver behind 2020 in issuances.
Nearly 85% of all retired VCUs in South Africa to date have been for compliance purposes; however, so far only 28% of all retired VCUs (516,745 VCUs) have been listed in the COAS system for use by tax-paying entities to meet their tax obligations. An additional 1,049,095 VCUs are expected to be listed in COAS in the near future to be used in the upcoming tax payment period (which ends July 29, 2021).
|Energy industries (renewable/non-renewable sources)||8|
|Waste handling and disposal||6|
*One VCU represents one tonne of carbon dioxide equivalent that was removed from the atmosphere or not emitted.
Greenhouse gas equivalencies for emission reductions and removals were calculated using the EPA Greenhouse Gas Equivalencies Calculator
|Waste handling and disposal||422,177|