Can South Africa's Carbon Policies Enable Carbon Dioxide Removal Scaling?

Carbon dioxide removal (CDR) technologies are critical for limiting global warming to below 2°C, ideally 1.5°C. Carbon pricing policies, grounded in Pigouvian tax theory, have played a central role in global decarbonisation efforts. With the growing recognition of CDR's importance in tackling global warming, this study qualitatively assesses South Africa’s current and proposed carbon pricing policies through content analysis to evaluate their effectiveness in promoting large-scale investment in CDR technologies. Drawing on policy diffusion and global policy lessons, the study assesses how effectively South Africa’s policies incentivize CDR adoption and scale-up. The analysis reveals that current carbon pricing frameworks primarily focus on emissions reductions without explicitly incentivizing the positive externalities of CDR. Key barriers include a lack of CDR specific incentives and limited integration of CDR within the policy design, which impedes alignment with deep decarbonisation goals. The findings suggest that South Africa’s carbon pricing policies largely adhere to the polluter pays principle but fall short of addressing the broader climate mitigation potential of CDR technologies. The study concludes that to effectively promote large-scale CDR investment, carbon pricing policies must evolve to integrate targeted incentives designed through policy diffusion by drawing on the experiences and innovations of other jurisdictions. This research contributes to tax policy literature by advocating a more inclusive carbon pricing approach that embraces CDR as a central element of South Africa’s emission reduction strategy.