Kgalalelo Makamela, an emerging researcher and taxation lecturer at the University of Pretoria, presented her latest research at the International Conference of Accounting and Business (iCAB), held at Sun City in late June 2024.
Her study, titled ‘Carbon pricing policies and the cost of net emission technologies (NETs)’, delved into the crucial role of carbon pricing in global climate change mitigation by incentivising reductions in greenhouse gas emissions. By equating the price of carbon to the cost of abatement, as per Pigou's theory of negative externalities, Makamela emphasises the urgent need to limit global warming to 1,5℃. Her research addresses a significant gap in the literature regarding the cost of carbon abatement through NETs.
Through a qualitative review, she estimates that carbon prices between $90 (R1 710) and $600 (R11 400) per tonne of CO2 are required to encourage investment in these technologies. Makamela highlights that current carbon tax rates, particularly in South Africa, fall short of what is necessary to promote NET adoption. Her findings suggest that aligning carbon pricing with global climate targets and increasing investment in research and development are critical to enhancing the scalability and cost-effectiveness of NETs.
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