We have expanded the list of climate policies we assess company engagement with to incorporate land-use related policy, referring to legislative or regulatory measures to enhance and protect ecosystems and land where carbon is being stored. Assessments under this category are currently underweighted in terms of their contribution to the overall company metrics. This weighting will be progressively increased over the next 6 months.
We adjusted the terminology used to describe the queries running down the left-hand side of our scoring matrix and added additional explanatory text to the info-boxes. This has no impact on the scores and methodology. It has been done following user feedback to improve clarity.
Climate Lobbying Overview: SAPIA has mixed top-line messaging on climate change, and qualifies its support for climate-related regulations by stating that they should not impact industry competitiveness. SAPIA also appears to have engaged negatively on specific climate-related regulations in South Africa, and appears to support a sustained role for fossil fuels in the energy mix, including oil and LPG.
Top-line Messaging on Climate Policy: SAPIA mixed top-line communications on climate chang ine 2022-2023. In its February 2022 Position on Climate Change, SAPIA supported limiting temperature rise to well below 2°C. In its 2021 Annual Report, published in January 2023, SAPIA appeared to support the draft Climate Change Bill in South Africa, arguing that it is necessary to provide policy certainty. However, in its February 2022 Position on Climate Change, SAPIA supported government regulation of climate change but qualified its support by stating that they should not affect the competitiveness of South African refineries, and also emphasized the risk of carbon leakage. InfluenceMap has not found any evidence of explicit support for the need to reduce GHG emissions in line with IPCC guidance.
Engagement with Climate-Related Regulations: SAPIA appears to have engaged negatively on climate-related regulations, however with limited transparency. In September 2022 joint statement, SAPIA advocated to policy makers to support measures to significantly weaken the Carbon Tax Act. These included support for lower tax rates from 2023-2025, free allocations and subsidies up to 2030, and delays in increasing the carbon price until post-2035. In its February 2022 Position on Climate Change, SAPIA did however appear to support government intervention to create emissions reduction plans and statutory reporting of emissions in South Africa. It also appeared to support emissions targets in line with the country’s Nationally Determined Contribution, and a fuel standard for liquid fuel products.
Positioning on Energy Transition: SAPIA appears broadly unsupportive of the energy transition, supporting a continued role for fossil fuels in the energy mix, including oil and liquified petroleum gas (LPG). In its February 2022 Position on Climate Change, SAPIA supported the use of renewables and more ‘low carbon energy sources’ in South Africa, but did not make clear which low-carbon sources it referred to. Additionally, the association strongly supported government intervention to increase the use of liquified petroleum gas and liquefied natural gas in the South African energy mix. In September 2021, SAPIA published a presentation on its corporate website outlining the economic contribution of the oil industry to South Africa, including benefits to GDP, energy security, and employment. In a 2020 position paper on its corporate website, SAPIA supported the increased use of LPG in South Africa to reduce carbon emissions.