On August 1, 2025, South Africa’s Department of Forestry, Fisheries and the Environment (DFFE) introduced two key documents under the new Climate Change Act, 2024. These are the Draft National Greenhouse Gas Carbon Budget and Mitigation Plan Regulations and the accompanying Draft Technical Guidelines. Together, they lay the foundation for South Africa’s first mandatory carbon-budgeting system.
Starting January 1, 2026, companies will need to track their carbon emissions. They will have to register, calculate their carbon budget, create a mitigation plan, and report annually. The public will have a chance to comment on these drafts from August 1 until September 30, 2025.
The draft regulations set legal obligations. They identify which companies must report and outline what should be in their mitigation plans. They also detail how companies will be monitored and what the penalties are for non-compliance. Conversely, the Technical Guidelines are meant to serve as a practical manual, providing clear steps for companies on how to meet these new requirements.
The regulations target key industries, from coal mining to food production. They cover various greenhouse gases, not just carbon dioxide. This wider focus highlights the importance of addressing all significant emissions sources.
Organizations engaged in these carbon-intensive activities must follow specific guidelines. They will be assigned sector-specific carbon budgets, which set limits on emissions for each reporting period. These companies will need to measure their emissions, report annually, and have their reports independently verified.
The approach also includes a tiered system for allocating carbon budgets. Ideally, companies will be given allowances based on their production levels. If that’s not feasible, alternative methods will be used to determine their emission targets. Each company will receive a five-year carbon budget, becoming stricter over time, starting with the period from 2026 to 2030.
In terms of reporting, companies must upload linked reports each March. These should detail their actual emissions and progress on their mitigation plans. Verification will occur three times during each commitment period, ensuring compliance. Companies that fail to meet requirements may face higher carbon taxes.
With the drafts open for public comment, it’s a chance for businesses to influence the final regulations. This engagement is crucial, as the implications for affected organizations are significant. Clear, informed input can help shape rules that work well for both the environment and the economy.
The move towards a carbon budgeting system is part of a broader global trend. Many countries are implementing similar measures to combat climate change. According to a recent report from the International Energy Agency, global CO2 emissions could rise by 10% if no significant actions are taken. This underscores the urgency behind South Africa’s new regulations.
As companies prepare to adapt, those who proactively engage with the regulations may better position themselves for future success and contribute to the transition towards a low-carbon economy.
For more insights, you can check the Department of Forestry, Fisheries and the Environment’s official release here.
