ENVIRONMENTAL AND PRODUCT SUSTAINABILITY

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We secure our licence to operate by driving sustainable air quality, waste and land risk management and by responding to the climate change and energy security challenges. We also promote responsible water use and ensure product stewardship.

Our commitment to the environment

Sasol depends on natural resources including coal, crude oil, natural gas and water for our business activities. Our activities have an unavoidable impact on the environment; however we remain committed to minimising these impacts while recognising that our material environmental challenges are mainly associated with our South African operations.

We invest significantly in reducing our environmental footprint, and in enhancing the positive environmental and social contribution of our products and processes. We do this by following an integrated approach:

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In the following pages more detail is provided on our continued efforts to sustain compliance with all applicable laws and obligations arising from our environmental authorisations. Further detail is also provided about our efforts to drive sustainable air quality improvements, respond to climate change and promote energy efficiency, water stewardship, product stewardship and land risk management while moving up the waste hierarchy.

RESPONDING TO CLIMATE CHANGE AND ENERGY SECURITY CHALLENGES

Sasol is committed to responding to our climate change risks through the development and implementation of an appropriate mitigation response to enable the long term resilience of the company’s strategy and business operations, including reducing our emissions and promoting energy efficiency within our operations.

For Sasol, a short-, medium- and long-term view of our climate change risks and opportunities is taken, with the use of scenario analysis across our diversified portfolio to inform decision-making.

Key processes in South Africa, especially coal gasification and combustion, result in relatively high carbon dioxide emissions. Sasol is committed to reducing its overall impact on the environment, whilst developing and implementing an appropriate climate change mitigation response to enable the long term resilience of the company’s strategy and business operations. In light of this, Sasol has identified environmental sustainability as one of our top risk events, including climate change as a key issue in the context of our support for the Paris Agreement and the national circumstances of the countries in which we operate.

Sasol’s value based growth strategy has been developed by leveraging our core strengths in response to global megatrends, one of which is climate change. Climate change and economic considerations influenced Sasol’s decision to focus on lower carbon intensive growth and to no longer consider investments in greenfield CTL and GTL facilities.

Managing our impact on climate change

Sasol’s foundation business in South Africa will continue to utilise coal as its primary feedstock, and therefore our climate change related efforts will focus on reducing our emissions profile through efficiency improvements, the selective use of natural gas to generate electricity based on gas availability as it is our aspiration to increase the use of natural gas.

Since the signing of the Paris Agreement, stakeholder awareness and expectations regarding climate change continue to gain momentum. Our key stakeholders are increasingly interested in the enhanced disclosure of climate change risks and the long term resilience of Sasol’s strategy and business model. Sasol acknowledges this external heightened focus on climate change management and its associated disclosure approach. This acknowledgement is reflected in our voluntary adoption of the recommendations made by the Task Force for Climate Related Financial Disclosures (TCFD) in 2018. Sasol continues to engage with key stakeholders as we progress with TCFD and our related disclosure journey.

This year Sasol engaged with key shareholders regarding a proposed shareholder resolution requiring a separate Climate Change Report to be developed and published in August 2019. We recognise that the appropriate management of climate related issues may require further elevation and the provision of optimised assurances. We therefore support the objective of the resolution and confirmed our intent to update our existing Climate Change booklet into a more comprehensive report which will be published in August 2019.

This report will by and large align with the outcomes envisaged in the proposed resolution. Accordingly, the report will aim to include an update of Sasol’s climate change scenario work; an overview of the activities to manage our risk and opportunities related to climate change; an overview of our adaptation strategy and Sasol’s view of long-term greenhouse gas (GHG) targets and internal fiscal instruments. Oversight of this process through Sasol's internal governance structures, including Board committees, will provide a measure of independent review through representation of external, non-executive directors in these structures.

Energy efficiency

We have a long-standing commitment towards promoting energy efficiency (EE) as a key business driver. We strive to continuously improve the EE of all our manufacturing in support of asset integrity, and this year we committed to the global Energy Productivity 100 initiative.

Our carbon footprint
  • We report our GHG emissions consistent with the recommendations of the Intergovernmental Panel on Climate Change (IPCC). Our total global GHG emission (measured in CO2 equivalent) decreased marginally to 67,4 million tons (Mt) in 2018 from 67,6 Mt in 2017. This figure includes direct emissions associated with our processes and our own road tanker fleets (Scope 1 emissions), as well as the indirect emissions associated with our electricity and steam imports (Scope 2 emissions).
  • Our GHG emission intensity (tons CO2e per ton of product – external sale) increased to 3,78 in 2018 from 3,66 in 2017, due to the decrease in the product – external sale2 as a result of external electrical infrastructure failure.
2. The definition of product – external sale differs from Total Production reported in the annual financial statements.
The boundaries of this figure only includes product that is destined for sale to Sasol customers, and does not include product utilised or sold between the Sasol Group of companies.

GHG intensity

GHG intensity

GHG emissions

GHG emissions
Further information on Sasol’s climate change management approach can be found in Sasol’s Form 20F, CDP and the Climate change focus story.