Cape Town - The pressure on South African businesses to prepare for policies involving a carbon tax or other limitations on carbon emissions will increase steadily, despite the lack of a legally enforceable agreement in Copenhagen.

This is the view of Jonathon Hanks, a director of the Incite consultancy group which manages a carbon-disclosure project in South Africa.

Hanks says he expects government's policy-making processes for establishing a legal framework for its commitment to lower greenhouse gas emissions will go ahead, despite the weaker-than-expected agreement on climate change in Copenhagen.

It is encouraging that President Jacob Zuma himself was involved in the high-profile negotiations because this will raise the profile of climate change on the national agenda and improve Zuma's own understanding of the issue.

Hanks does not believe that the Copenhagen events will either accelerate or hold back South African policy-making.

Although the Sydney Morning Herald reported on Monday that the prices of carbon credits on the European carbon credit market would probably fall by 7% in response to the diluted Copenhagen agreement, Sterling Waterford director Greg Paterson Jones believes prices should not drop significantly because current carbon credits remain valid until 2012 in terms of the existing Kyoto protocol.

In 2008 Sterling Waterford listed carbon credit notes on the JSE, which credits can be purchased in rands, based on carbon credit prices on the European market.

Paterson Jones says that although uncertainty still prevails about the global carbon market after 2012, the European market will continue, especially because Europe has already committed itself to even stricter greenhouse gas restrictions.

- Sake24.com

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