Understanding the Role of Subsidies in South Africa’s Coal-Based Liquid Fuel Sector

This policy brief analyzes the coal-to-liquid (CTL) fuel sector in South Africa, exploring the role of subsidies in driving the consumption of coal-derived fuels. It focuses on the various support measures that have and continue to benefit the CTL industry. The CTL industry is monopolized by Sasol, a company minority-owned by the South African government. Two subsidy estimates are presented: one based on the market price support to liquid fuels produced from coal and the second based on the carbon tax exemption for Sasol. The results highlight the impact of fossil fuel subsidies on the consumers in and the environment of South Africa.

Insitute

  • International Institute for Sustainable Development