Sasol Limited Climate Change Report 2021 - Book - Page 29
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A NET ZERO AMBITION
Future Sasol: Enabling activities (CONTINUED)
Carbon offsets
Our
approach
Sasol's offset and
CDR requirements
In line with our offset
approach and principles,
our requirements evolve
from primarily procuring
A/R offsets to prioritising
Sasol-developed CDRs.
A/R offsets are being
used to meet compliance
requirements under the
South African Carbon Tax
Act, 15 of 2019 and if
necessary, as a last resort
to meet our targets.
Sasol’s evolving offset demand profile
DEMAND PHASE
1
DEMAND DRIVER/S
SCOPE 1 (ROADMAP)
MtCO₂e/a
SCOPE 1 AND 2
(ROADMAP)
MtCO₂e/a
SCOPE 3 (ROADMAP)
MtCO₂e/a
OFFSET TYPE/LEVER
AR/CDR
Carbon Tax Phase 1
4,3 annually
No offset requirement
No offset requirement
AR
No offset requirement
No offset requirement
AR + CDR (NbS)
2019
2022
2
2027
Carbon Tax Phase 2
4,3 annually
3
2032
Carbon Tax Phase 3
Scope 1 and 2 roadmap
Offset benefit likely
reduced if allowed
Scope 1, 2 and 3 roadmap
Unlikely to be
an offset allowance
AR + CDR (NbS + TbS)
Unlikely to be
an offset allowance
CDR (NbS + TbS)
4
5
2040
Scope 1, 2 and 3 roadmap
2050
Net Zero ambition
Offset requirement
TBC
AR:CDR
AR + CDR (NbS)
Sasol's approach
We are aiming to meet our offset demand while allowing for the potential to unlock additional value pools. We are focusing on procuring credits in the short term, co-developing projects in
the medium term and potentially developing a new business stream in the long term that also meets our CDR offset requirements.
Passive market
involvement
Short term
Procuring credits
Buying credits from
the market
• From 2019, ~6,7 million credits have been retired against the South
African Carbon Tax Act
• Mitigated the release of as many tonnes of CO2e
• Seven projects supported and in excess of R260 million avoided carbon
tax realised over the past two years
Market tested through a RFI:
Medium term
Co-development
Developing projects
with experienced
developers to share
risks and costs
• ~50 proposals received and evaluated against Sasol's core carbon
offset principles
• Preference given to projects aligned with our approach and principles
• Three project-type categories prioritised for partnership (see page 29)
Long term
New business
through in-house
project development
Solely develop
projects, carry full
risk but with ability
to access value pools
• To be initiated once the full complement of offset resources are defined
Active market
involvement across
value chain
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Sasol Climate Change Report 2021
Developing the
international market
Scaling the global carbon market and
developing transparent rules is integral
to global ambitions to reach net zero
emissions.
Globally, various studies and work
activities are underway to develop the
market to meet projected demand for
offsets.
Accordingly, we welcomed the request
to participate in and be a member of
Mark Carney's Taskforce on Scaling
Voluntary Carbon Markets, a private
sector-led initiative working to scale an
effective and efficient voluntary carbon
market to help meet the goals of the
Paris Agreement.
Sasol is a member of Working Group
D – Credit-level Integrity, aimed at
defining core carbon principles and
a taxonomy of additional attributes to
ensure credible offset claims are made
and met.