M van Schalkwyk: Western Cape Climate Change Summit

8 June 2007

Western Cape Premier, Ebrahim Rasool
MEC for Environment, Planning and Economic Development, Tasneem Essop
Honoured guests
Ladies and gentlemen

Introduction

I would like to commend the Western Cape province for hosting this Climate
Summit. As we continue to improve our understanding of the impacts and risks of
climate change, we increasingly understand that we must also find local
solutions to deal with this global challenge.

Building on the progress achieved at this Summit, the next challenge is for
the province to take this Summit to every local municipality and local
community, where I am sure you will find many willing partners to work with you
in moving from planning to implementation.

In government, industry and households, we take decisions every day that
could lock South Africa's next generation into accelerated climate change,
increased emissions, inefficient energy use, and wasteful patterns of
production. We just have to think of the lifespan of decisions that we all make
every day. Every vehicle purchased has a likely lifespan of at least ten years;
factories and industrial developments will be there for at least thirty years;
power stations and energy facilities last for fifty years or more; homes and
offices have a lifespan of at least one hundred years; and decisions about
land-use and development patterns last even longer than that.

These are the kinds of decisions that we need to consider carefully if we
want to place the country on a more sustainable, climate-friendly growth
path.

Adaptation

But we must also ask how we deal with the risks and threats to existing
infrastructure and current economic and development activities. In particular,
we must find innovative ways of adapting to the inevitable impacts of climate
change.

I am therefore confident that this Summit will lead to an action plan that
will assist with our joint efforts to integrate adaptation policies and
measures with our national, provincial and local sustainable development
strategies.

In this province, interventions in key policy areas are required
particularly in the agricultural sector for example by developing more drought
and flood resistant crops and considering crop switching strategies, and in
water resource management. It will also be critically important to find ways of
communicating information about climate scenarios and adaptation options to
subsistence farmers and rural communities. Other urgent tasks include improving
early warning systems and the capacity for disaster management, risk screening
of major infrastructure investment projects, in particular in coastal areas,
and the strengthening of physical defences against flooding.

International climate regime and national implementation

In considering a more effective, flexible and fair international climate
regime beyond 2012 we understand that we all have to do much more. And though
developed countries have an obligation to take the lead by adopting more
ambitious emission reductions under the Kyoto Protocol, as developing countries
we understand that we also have to do more to act on our responsibilities. The
South African Government understands the urgency of action, and that the costs
of doing nothing about climate change far outweigh those of taking concrete
measures.

Our roadmap for a national climate policy recognises that the solution to
the critical challenges we face should be addressed through integrated
government planning, in collaboration with stakeholders through the National
Climate Change Committee (NCCC) and a strengthened multilateral regime.

To this end, the Inter-Ministerial Committee on Climate Change led by the
Department of Environmental Affairs and Tourism (DEAT) initiated the Long Term
Mitigation Scenario (LTMS) process. This process will outline the range of
ambitious but realistic scenarios of future climate action, notably long-term
emissions scenarios and their cost implications. In addition, various national
departments, provinces and cities are refining their sector plans in line with
the National Climate Change Response Strategy. Working closely with industry,
DEAT will also be finalising our updated Greenhouse Gas Inventory. All this
will inform our first ever Long Term National Climate Policy. We plan to
publish this during 2008/9.

On the mitigation side, DEAT will also initiate a process that will, over
the next few years, match our efforts on the mitigation scenario building
process. This will culminate in a National Adaptation Plan.

The carbon market challenge

In terms of reducing harmful emissions, you yesterday had extensive
discussions on taking the first steps towards decarbonising the energy sector
in the province. Given that the energy sector is the single largest source of
emissions in South Africa, the government's current interventions are aimed at
more efficient energy use, diversifying energy sources, and research and
development aimed at new technologies that promote cleaner and advanced energy
production and consumption.

Though the Western Cape is likely to feel the most acute impacts of climate
change, it also has the luxury of abundant potential for renewable energy
sources.

I would like to refer to one specific opportunity that we are yet to fully
exploit. That is the Kyoto Protocols so-called Clean Development Mechanism
(CDM) which makes it possible to trade our emission reductions on international
carbon markets, for example, through energy efficiency improvements in
industry, methane recovery from landfill sites, or switching to renewable
energy sources. The CDM is the market mechanism designed to assist developing
countries to stimulate the green investment required to tackle climate change
and move to a low-carbon economy. The CDM, even with its current limitations,
provides an effective vehicle for developing countries to participate in
ongoing efforts to reduce carbon emissions, to achieve technological progress
and to promote sustainable development.

There is a huge carbon market developing, and because of various barriers we
are yet to take full advantage of this opportunity. In 2006 the value of this
market was in the range of US$30 billion, which represented a threefold
increase compared to 2005. Project-based activities through the Clean
Development Mechanism totalled nearly US$5 billion in 2006, and the voluntary
market for reductions by corporations and individuals also grew strongly to an
estimated US$100 million.

However, Africa is hardly on the radar screen. Asia continues to dominate
the CDM market. China supplied some 61% of the emission reductions purchased by
industrialised countries since 2002. The share of the whole of Africa is around
3%, with nearly half of that from South Africa. In terms of current projects in
the CDM Executive Board's pipeline, India leads with some 600 projects,
followed by China with 400 and Brazil with 200. South Africa has 9 registered
projects, with another 39 in the CDM Executive Board's and South Africa's
Designated National Authority's pipelines. For the Western Cape, only one
project the Kuyasa Low Cost Housing Energy Efficiency Project, has been
registered as a CDM project, and there are a few in the pipeline or conception
stages.

Chair, there is a rapidly closing window for first commitment period of the
Kyoto Protocol, which expires in 2012. Negotiations on the second commitment
period have started. There are also alternative sources of demand such as the
voluntary market that may have the flexibility to reward these efforts, and in
particular small scale projects, regardless of the future negotiations on a
Kyoto regime after 2012.

In the Kyoto regime beyond 2012 this potential may grow by orders of
magnitude. If all developed countries took on much deeper emissions reduction
targets, peaking by 2050 with cuts of 60 to 80%, which is what we believe is
required, and if they purchased half of their reductions in the developing
world at a carbon price of at least $10 per ton, then the financial flows could
gradually grow to approximately $100 billion per year by mid-century.

We must start now to position ourselves for this new low carbon economy. We
must raise awareness from both public and private stakeholders. We must
identify and remove the barriers, develop institutional capacities and
technical expertise and source projects to exploit this huge opportunity. I
would like to challenge the province to work with industry, local and
international investors and especially local governments to unlock this
potential and spur climate-friendly growth and sustainable development, before
2012, and beyond.

If the Western Cape, or a local municipality, could capture even a
relatively small share of these financial flows it could provide a major boost,
in combination with other sources of funding, to efforts aimed at bridging the
gap between high- and low-carbon development. It could soon make all the
difference when you have to choose between fossil-fuel energy and more
expensive renewable energy sources. Assuming further technological progress and
related cost reductions, it could make an important contribution towards
unlocking our boundless solar power potential in this country.

Water resources

Chair, over the longer term, climate change will exacerbate environmental
degradation, desertification, biodiversity loss and resource scarcity. These
are all sources of potential instability and conflict.

Africa is at risk from increasing water stress, especially in southern
Africa. By 2020, between 75 million and 250 million people are likely to
experience water shortages as a result of climate change. In combination with
increased demand, this will adversely affect livelihoods, freshwater fish
resources and agricultural production. In some countries, yields from rain-fed
agriculture could be reduced by up to 50% by 2020.

A key challenge and opportunity in Africa is to use trans-boundary water
resource management to reduce conflict potential, to enhance peacemaking by
opening new avenues for dialogue, and to promote regional integration.

Consider, for example, the fact that almost 40% of Africa's international
borders are demarcated by river channels and basin watersheds, and that most
major rivers traverse national boundaries. These resources are sensitive to
even moderate reductions in rainfall as are predicted to occur in many places
across Africa. Not only will increased scarcity of water resources threaten the
sustainability of hydro-electric power generation, irrigation, agricultural
production, fish stocks, food security, transport and industry, but it could
also contribute to an increase in inter-communal and inter-state migrations and
tensions.

Lake Tanganyika provides up to 40% of animal protein intake for the
population of the surrounding countries. It is expected that climate change
will reduce catches in the Lake by around 30%. Lake Victoria, which joins
Uganda, Tanzania and Kenya, supports a common economy for some 30 million
people who depend on its water and fish. Lowering water levels in the Lake have
previously led to tensions with Uganda, who draws water into the Nile through
hydro-electric turbines. This also concerns Egypt downstream, who has even
placed inspectors along Uganda's stretch of the Nile.

This underlying conflict potential is exacerbated by post-colonial
arrangements which are generally not conducive to mitigating conflict or
competition over water resources. For example: following the declaration of the
Egyptian Republic in 1953, the 1959 Nile Basin agreement preserved British
colonial interests in Sudan. The agreement neglected the role of Ethiopia,
Tanzania, Uganda and Rwanda in the governance of the trans-boundary Nile
resources. Today Egypt and Sudan still dominate decision-making over the
allocation of Nile water resources, with the bulk of the Nile's flow going to
these two countries.

To understand the complexity of mitigating future conflict between riparian
States, we only have to think about Jordan system, shared by Syria, Lebanon,
Israel and Jordan, the Tigres-Euphrates system, shared by Syria, Turkey and
Iraq, and the Indus Ganges-Brahmaputra systems, shared by India, Bangladesh,
Nepal and Pakistan.

Though climate impacts on water resources may not be the primary or sole
source of future conflict, it could ignite or exacerbate conflict where other
political, ethnic or military tensions exist. It is therefore critical to
design and strengthen regional water regimes to manage the challenges around
increased water scarcity, and more specifically to appropriately govern
international rivers, watersheds and underground water resources.

Fortunately the need to address water policy challenges associated with
climate change is high on the agenda of the Southern African Development
Community (SADC) Ministers and the African Ministers Council on Water (AMCOW).
These bodies play a key role in facilitating regional and international
co-operation and in co-ordinating trans-boundary water policies. This includes
river and water basin governance, co-management of resources, adaptation
strategies, strategic water infrastructure support, water security and the
maintenance of African eco-systems. Two weeks ago climate change was one of the
prominent issues addressed by African Water Ministers meeting in Brazzaville,
and various approaches to enhancing African countries resilience and
adaptability to the impacts of climate change were considered. The SADC
Protocol, a legally binding framework for the management of shared waters in
the region, the SADC Water Policy and the SADC Water Strategy, as well as the
establishment of 7 river basin organisations in SADC, together represents a
feather in the cap of our region.

Conclusion

Chair, I would like to conclude by stressing that we should be flexible and
proactive in our planning and continuously integrate the latest scientific
findings and practical experience with our long term strategic frameworks. We
must learn to expect the unexpected, and continuously ask ourselves how new
evidence of climate change will impact our daily lives and how each of us can
contribute to reducing emissions. Globally, in South Africa and in every
community we must all do more and act with a greater sense of urgency.

Enquiries:
Riaan Aucamp
Cell: 083 778 9923

Issued by: Department of Environmental Affairs and Tourism
8 June 2007