Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report Mimi van 2021-11-30 0 Final Nathan Wilson Gino de Villa Noordwyk Date Rev. Status Prepared By Checked By Approved By Thebe Mamakoko Garrith Bezuidenhoudt Mariano Salto Reviewed By Approved By Approved By DMRE World Bank H364991-00000-200-066-0006, Rev. 0 Page i © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Executive summary Hatch was engaged to analyse options to develop a comprehensive GHG Assessment and Reporting Framework that contributes to DMRE’s efforts in i) Identifying policy gaps in relation to energy data and identify opportunities for supporting related emissions reporting; and ii) Providing recommendations on how sectoral stakeholders can manage the collection and reporting of energy data in support of the related GHG emissions in their respective sub-sectors in accordance with best international experience and practices. The assignment consisted of two overarching components namely:  Component A: Identify policy gaps in relation to energy data and related emissions reporting; and,  Component B: Provide recommendations on how the DMRE will manage and assess energy data and related GHG emissions reporting for South Africa’s energy, mining and industrial sectors, and support DEFF’s international GHG emissions reporting. Table 1-1 provides a summarised view of the gaps identified, framework elements that address the gaps, and activities required to implement the framework over the short- (1 year), medium- (2 year) and long term (3 year) horizons. Table 1-1: Framework summarised overview Identified gap Framework element Implementation plan activities addressing the gap Near term (2021/2022) Medium term (2022/2023) Long term (2023/2024) 1. Lack of a defined role Element 1: Formalising  Document DMRE’s role in supporting South Africa’s GHG  Evaluate 2021/2022 demand and carbon intensity reduction data  Align future strategies with DFFE’s GHG management strategy DMRE’s role in management agenda and agree on this role with the SNE against DMRE targets supporting the national (DFFE)  Share data with DFFE to evaluate against GHG emission GHG inventory  Create targets and metrics to monitor and evaluate progress management objectives and targets toward achieving these goals and objectives  Refine energy supply and demand plans based on data results  Create internal monitoring and reporting system for energy and DFFE consultation demand and carbon intensity reduction outcomes  Create data flows to document current state and future improvement opportunities for data sharing protocols between other state entities and to improve data reliability and completeness  Refine outdated MoU to formalise data sharing architecture with DFFE 2. Lack of a mechanism to Element 2: Monitoring  Implement Energy Management Plan data collection and  Evaluate year 1 EMP data to identify and address gaps  Evaluate Year 2 EMP data at the sector and national level to compile and evaluate and evaluating the GHG evaluation determine effectiveness of energy demand and fuel switching  Refine EMP data collection processes where required GHG emissions impact of industrial strategies reductions associated energy management  Refine strategy where required with DMRE programs plans  Refine data compilation templates or mechanisms where required H364991-00000-200-066-0006, Rev. 0 Page ii © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Identified gap Framework element Implementation plan activities addressing the gap Near term (2021/2022) Medium term (2022/2023) Long term (2023/2024) 3. Lack of systems to Element 3: Reporting,  Pull results from each energy and GHG related DMRE program  Evaluate programme GHG abatement outcomes against targets  Ongoing monitoring, evaluation, and refinement of programme monitor GHG reductions monitoring, and to evaluate comparability of GHG emission reduction outcomes and cost per tonne of CO2e abated outcomes associated with energy evaluating GHG and  Create protocols for organising data to enable summing of GHG  Evaluate outcomes against DFFE’s national GHG management and offset strategies other socio-economic abatement results against DMRE targets objectives impacts associated with all DMRE’s energy and  Evaluate cost data availability to calculate cost-output ratios  Refine strategy and targets as required carbon intensity  Refine data compilation and reporting architecture as required programmes 4. Unusable energy data Element 4: Improving  Review the national OPG strategy to identify opportunities for  Develop and implement strategy to streamline duplications and  Ongoing monitoring and evaluation of energy and associated provided to DMRE data compilation and synergy with data sharing and availability initiatives close gaps GHG and socio-economic data management  Conduct jurisdictional scan to identify opportunities to leverage  Create and formalize data management protocol mechanisms best practices from other regions on data sharing initiatives  Identify DMRE’s role for each of the relevant datasets within the  Create data flows for all energy sources making up the national data management protocol energy supply and link each source to the data management  Create data governance mechanisms to manage data system covering it  Identify energy and GHG emission data duplications and gaps  Evaluate comparability of energy and GHG data reporting and assessments between state entities 5. Disparate, ad hoc data Element 5: Improving Identify opportunities for software system linkages and other information-sharing mechanisms sharing between energy and GHG data  Develop detailed system architecture showing available data  Develop a data flow model for the transition from legacy systems  Deploy the cloud hosted solution technology stack and develop departments management and interfaces, automated processes, or manual workflows for data to a cloud hosted solution set that is coordinated with the any required Application Interfaces (API) to connect the DMRE monitoring software sharing between systems stakeholders so that data sharing requirements are captured for CED to stakeholder applications systems all stakeholders  Identify the data flow, i.e., what data is supplied to whom, how, when, and for what purpose  Develop a workflow specification for data collection and use by relevant stakeholders which identifies the uses cases of the data,  Identify data and data format managed by DMRE along with the required interactions of stakeholders, and timing issues between application in which the data is managed, the data type, and data stakeholders format required for DMRE but other stakeholders  Develop a data specification to synchronize, conform, and  Identify all calculations, quality checks, processes, or any standardize data formats with recommendations for eliminating manipulation of the data by DMRE any duplications H364991-00000-200-066-0006, Rev. 0 Page iii © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Identified gap Framework element Implementation plan activities addressing the gap Near term (2021/2022) Medium term (2022/2023) Long term (2023/2024) Migrate file-based databases to a modern common data environment (CDE)  Prepare a roadmap for the transition of the identified disparate  Prepare data governance and oversight procedures for all data  Deploy the CDE and supportive technology stack for DMRE systems connected to a DMRE Common Data Environment sets coordinating data requirements between all stakeholders (CDE) supported by analysis, visualization, and reporting and the identified technology stacks technologies, e.g., DMRE Azure cloud hosted data platform and MS PowerBI development application Evaluate implementation of a CDE for data sharing systems across government departments  Prepare a roadmap for the transition of the identified disparate  Repeat the process of defining the system architectures, data  Migrate other departments to the DMRE CDE systems connected to a DMRE Common Data Environment specifications, workflow specifications, and data governance and (CDE) oversight procedures for other government departments joining the CDE  Identify migration plans required for other departments to take advantage of the DMRE CDE H364991-00000-200-066-0006, Rev. 0 Page iv © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Identified gap Framework element Implementation plan activities addressing the gap Near term (2021/2022) Medium term (2022/2023) Long term (2023/2024) Consideration of the Just Enabling the Just Energy  Refine and finalise a clear definition of the JET with a framework  Integrate findings from activities above into energy project  Identify and create competitive frameworks for investment in Energy Transition Transition disseminated to industry for feedback development strategy lower carbon energy development to overlay programmes such as the REIPPPP with a socio-economic development  Provide industry with a target date to when JET-related policies  Assess the social impact strategies of companies associated component. can be expected with potential early closures of fossil-fuel derived assets  Identify and drive investment in infrastructure required to support  Establish a dedicated JET office within the DMRE with  Create and monitor job creation and protection metrics for all new industries e.g., manufacturing, transmission and distribution, appropriate political mandate, budget, staff, and resources to energy supply infrastructure integration of hydrogen, etc. drive and support in the implementation of the JET strategy  Assess a potential role for DMRE in a strategy for investing  Establish a communication platform from which the DMRE can national revenues back into low carbon energy development (see effectively communicate and engage with industry regarding the Box 4-1 for an example) implementation of the JET  Share lessons learned with other national governments to  Develop a comprehensive, verified knowledge database of the identify opportunities for improvement coal mining industry in terms of coal worker skills, employee numbers, life of mine plans etc.  Assess the future planned industrial development within the Mpumalanga and Limpopo provinces that could provide alternative job opportunities for coal industry workers  Collaborate with other government agencies to align on and support relevant initiatives driven by e.g., Department of Trade and Industry, Department of Public Enterprises etc.  Establish a partnership with the Department of Basic Education to ensure the younger generation (ages 6 to 18) are appropriately equipped for jobs that support the lower carbon energy supply of the future  Assess the national energy balance exposure to social (e.g., job loss) risks, such as job losses associated with coal-fired power plants decommissioned compared to the number of jobs that can be created in new energy-related industries  Engage with the NPC to support consultation with relevant stakeholders on employment opportunities for communities affected by the energy transition, as well as previously marginalized communities.  Identify barriers to lower carbon energy uptake such as cultural and awareness impediments  Assess and monitor progress in executing the JET strategy. . H364991-00000-200-066-0006, Rev. 0 Page v © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 List of Abbreviations AEL Atmospheric emission license AFREC African Energy Commission AQO Air Quality Officer BUR Biennial Update Report CD Chief Directorate CDLP Common data lifecycle platform or environment CED Central Energy Database CFCs Chlorofluorocarbons CH4 Methane CO2 Carbon Dioxide CO2-eq Carbon Dioxide equivalent CSV Comma-separated values dB Database DFFE Department of Forestry, Fisheries and the Environment DMRE Department of Mineral Resources and Energy EEMS Energy Efficiency Monitoring System EMP Environmental Management Plan GHG Greenhouse gas GHG Emissions Emissions from CO2, CH4, N20, HFC’s, PFC’s and SF6 HFCs Hydrofluorocarbons HTTP Hypertext Transfer Protocol IEA International Energy Agency IPCC Intergovernmental Panel on Climate Change IPPU Industrial Processes and Product Use IRP Integrated Resource Plan JET Just Energy Transition MoU Memorandum of Understanding MPRDA Mineral and Petroleum Resources Development Act Mt Mega tonne NAEIS National Atmospheric Emission Inventory System N2O Nitrous Oxide NC National Communications NCCRP National Climate Change Response Policy NDP National Development Plan NEES National Energy Efficiency Strategy H364991-00000-200-066-0006, Rev. 0 Page vi © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 NEMA:AQA National Environmental Management Act: Air Quality Amendment NGERs National GHG Emissions Reporting Regulations NGHGIS National GHG Inventory Management System NPC National Planning Commission UI/UX User interface/ User experience PFCs Perfluorocarbons PPP Pollution Prevention Plan QC Quality Control SAAQIS South African Air Quality Information System SAGERS South African Greenhouse Gas Emissions Reporting System SANS South African National Standard SAPIA South African Petroleum Industry Association SAWS South African Weather Services SET Sector Emission Target SF6 Sulphur Hexafluoride SNE Single National Entity SQL Structured Query Language TSV Tab separated values UNFCCC United Nations Framework Convention on Climate Change H364991-00000-200-066-0006, Rev. 0 Page vii © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Table of Contents 1. Introduction ................................................................................................................................... 11 2. Component A – Understanding the gap ....................................................................................... 12 2.1 Gaps in policy, legislation, and institutional arrangements ...................................................... 12 2.2 Recommendations to address the gaps ................................................................................. 17 2.2.1 Gap 1: Lack of defined role ....................................................................................... 17 2.2.2 Gap 2: Lack of mechanism to compile and evaluate GHG emissions reductions associated with DMRE programs .............................................................................. 17 2.2.3 Gap 3: Lack of systems to monitor GHG reductions associated with energy and offset strategies.................................................................................................. 17 2.2.4 Gap 4: Unusable energy data provided to DMRE ...................................................... 18 2.2.5 Gap 5: Disparate, ad hoc data sharing between departments .................................... 19 3. Component B – A framework to close the gaps .......................................................................... 20 3.1 The framework....................................................................................................................... 20 3.1.1 Element 1: Formalising DMRE’s role in supporting the national GHG inventory ......... 20 3.1.2 Element 2: Monitoring and evaluating the GHG impact of industrial energy management plans ................................................................................................... 21 3.1.3 Element 3: Reporting, monitoring, and evaluating GHG and other socio- economic impacts associated with all DMRE’s energy and carbon intensity programmes ............................................................................................................. 21 3.1.4 Element 4: Improving data compilation and management mechanisms ..................... 22 3.1.5 Element 5: Improving energy and GHG data management and monitoring software systems ...................................................................................................... 23 3.2 Implementing the framework .................................................................................................. 23 3.2.1 Implementing Element 1: Formalising DMRE’s role in supporting the national GHG inventory .......................................................................................................... 25 3.2.2 Implementing Element 2: Monitoring and evaluating the GHG impact of industrial energy management plans ......................................................................... 27 3.2.3 Implementing Element 3: Reporting, monitoring, and evaluating GHG impacts associated with all DMRE’s energy and carbon intensity programmes ....................... 29 3.2.4 Implementing Element 4: Improving data compilation and management mechanisms ............................................................................................................. 31 3.2.5 Implementing Element 5: Improving energy and GHG data management and monitoring software systems ..................................................................................... 33 3.2.6 Enabling a Just Energy Transition (JET) ................................................................... 36 3.3 Modernising the data management systems........................................................................... 41 H364991-00000-200-066-0006, Rev. 0 Page viii © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 List of Addendums Addendum 1: Gap Analysis on Policy, Legislation, and Institutional Arrangements (H364991-00000-200- 066-0001) Addendum 2: Gaps and Recommendations for Managing National GHG and Energy Data at DMRE (H364991-00000-200-066-0002) Addendum 3: Options Report for a GHG Assessment and Reporting Framework Energy, Mining and IPPU Sectors (H364991-00000-200-066-0003) Addendum 4: Framework Implementation Plan(H364991-00000-200-066-0005) Addendum 5: Digital Framework for Improving GHG Data Management and Monitoring Software Systems Implementation (H364991-00000-200-066-0004) H364991-00000-200-066-0006, Rev. 0 Page ix © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 List of Tables Table 1-1: Framework summarised overview ........................................................................................... ii Table 1-1: Assignment deliverables ....................................................................................................... 11 Table 2-1: Consolidated list of gaps ....................................................................................................... 12 Table 3-1: Framework Elements ............................................................................................................ 20 List of Figure Figure 3-1: Simplified recommended systems structure ......................................................................... 42 H364991-00000-200-066-0006, Rev. 0 Page x © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 1. Introduction Hatch was engaged to analyse options to develop a comprehensive GHG Assessment and Reporting Framework that contributes to DMRE’s efforts in i) Identifying policy gaps in relation to energy data and identify opportunities for supporting related emissions reporting; and ii) Providing recommendations on how sectoral stakeholders can manage the collection and reporting of energy data in support of the related GHG emissions in their respective sub-sectors in accordance with best international experience and practices. The assignment consisted of two overarching components namely:  Component A: Identify policy gaps in relation to energy data and related emissions reporting; and,  Component B: Provide recommendations on how the DMRE will manage and assess energy data and related GHG emissions reporting for South Africa’s energy, mining and industrial sectors, and support DEFF’s international GHG emissions reporting. Table 1-1 lists the deliverables that were developed to achieve the objectives of the Components A and B. These deliverables are included in Addendums A to E. Table 1-1: Assignment deliverables Component Deliverable Deliverable Reference Location number 1 Gap Analysis on Policy, Legislation, and H364991-00000- Addendum A Institutional Arrangements 200-066-0001 Component A 2 Gaps and Recommendations for H364991-00000- Addendum B Managing National GHG and Energy Data 200-066-0002 at DMRE 3 Options Report for a GHG Assessment H364991-00000- Addendum C and Reporting Framework Energy, Mining 200-066-0003 and IPPU Sectors 4 Framework Implementation Plan H364991-00000- Addendum D Component B 200-066-0005 5 Digital Framework for Improving GHG H364991-00000- Addendum E Data Management and Monitoring 200-066-0004 Software Systems Implementation 6 Industry feedback session n/a This report provides a summary of the outcomes of the six deliverables produced during the development of the framework. This summary report should be read together with the detailed deliverables as referenced, to ensure the reader understands the context under which the framework was developed. H364991-00000-200-066-0006, Rev. 0 Page 11 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 2. Component A – Understanding the gap The following sections provide high level summaries of the gaps identified and recommendations associated with the gaps. For more detailed context and background refer to H364991-00000-200-066-0002 (Gaps and Recommendations for Managing National GHG and Energy Data at DMRE). 2.1 Gaps in policy, legislation, and institutional arrangements The objective of the gap analysis was to identify possible constraints and opportunities in existing policies and institutional arrangements to support Energy, Mining, and IPPU sectors on energy data and related GHG emissions reporting mechanisms and protocols. This section summarises gaps in institutional arrangements, policies, and legislation among data compilers and between compilers and data providers. These gaps have been delineated between those DMRE can influence (“I”), and those over which DMRE has control (“C”). Gaps are summarised in Table 2-1 below. Table 2-1: Consolidated list of gaps Function Gap Relevance DMRE 1 Oversight of the DMRE lacks a clearly The Draft Climate Change Bill proposes a climate change secretariat, Influence National Climate defined role in supporting which will oversee and coordinate all activities from the different Change Strategy DFFE in managing the government agencies that influence climate change-related outcomes. national climate change This secretariat will be the entity that should formalize all information agenda. sharing and GHG-reduction initiatives between DFFE and DMRE. Whilst the secretariat will sit within DFFE, it will require significant input and coordination with DMRE on the energy file to achieve national GHG management goals. Energy and related GHG emissions data are collected by multiple state entities without formal information sharing mechanisms. As each entity has different compilation methodologies serving different purposes, it leads to reporting fatigue on the part of industry, and risk of inconsistent H364991-00000-200-066-0006, Rev. 0 Page 12 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Function Gap Relevance DMRE reported data. This risk hinders monitoring and evaluation of progress toward energy management and GHG stabilisation goals, as well as transparency. 2 Reporting, monitoring, There is no mechanism to To enable monitoring and evaluation of energy management programs Control and evaluation of compile and evaluate the in the overarching energy management strategy, program results in energy and carbon GHG emission reductions EETMS, REDIS and COAS should be linked to CED to facilitate ongoing management associated with the carbon evaluation of energy demand and carbon intensities of the national programme outcomes management-related energy balance, and the impact of the shift in demand and carbon programs led by DMRE i.e., intensities on the national GHG inventory. As noted in Gap 1, the GHG energy efficiency, renewable emission impact of these programs should be linked to DFFE’s GHG energy, and carbon offsets. data management systems, whether through SAGERS or another data monitoring and evaluation system. 3 Monitoring and There are currently no The Draft Regulations Regarding Registration, Reporting on Energy Control evaluating the GHG systems and procedures to Management and Submission of Energy Management Plans do not impact of industrial monitor and evaluate GHG refer to GHG emissions. This omission hinders the ability to monitor and energy management emission reductions evaluate emission reductions against the overall carbon reduction plans associated with energy potential identified through an aggregation of the EMPs. management and offset The Strategic Plan 2020-2025 specifies a goal to reduce GHG strategies. emissions by 42% by 2024 from combined reductions in Energy, IPPU, AFLOU and Waste sectors. Reporting and assessment frameworks to monitor GHG reductions in each sector are not aligned, which hinders evaluation of aggregated reductions from all four sectors. Reducing energy demand through energy efficiency measures is a key component of DMRE’s low carbon transition strategy outlined in its H364991-00000-200-066-0006, Rev. 0 Page 13 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Function Gap Relevance DMRE Strategic Plan, yet the NEES does not link energy efficiency initiatives with associated GHG reductions. Despite being South Africa’s primary Plans for reducing GHG emissions, the IRP and IEP do not include consideration or evaluation of the associated GHG emission reductions. 4 Data compilation and Energy data provided to Energy data compiled by DMRE appears incomplete when compared Control management DMRE is incomplete or to the national GHG inventory, which may indicate that some energy mechanisms unusable. consumption data is not being reported. As DMRE provides industry with standardised data compilation templates, and as the data management system pulls the data directly from these templates, it is assumed that the data received specifically from DMRE requests is complete. The gaps therefore are likely arising from incomplete or unusable data from intermediary data providers, such as NERSA and SAPIA, which do not provide data in the same format as DMRE’s data compilation templates, or from data consumption activities not currently covered in DMRE’s energy data inventory. An incomplete energy balance impedes DFFE’s ability to evaluate whether the national GHG inventory is complete. The GHG inventory may also have gaps on GHG emissions reported through DMRE legislation, for example methane associated with fracking, which is reported through the Regulations for Petroleum Exploration and Production. Incomplete information also hinders DMRE from achieving its mandate under the National Energy Act to diversify the energy mix, including increasing the supply of lower carbon sources of energy, by H364991-00000-200-066-0006, Rev. 0 Page 14 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Function Gap Relevance DMRE not providing the full inventory of energy and related GHG emissions data required to evaluate progress toward achieving this mandate. 5 Energy and GHG data Data sharing is based on ad Energy and carbon management policies, programs, laws, regulations, Influence management and hoc requests to meet and arrangements are more impactful and easier to implement when monitoring software specific needs, creating a informed by robust data and strong stakeholder engagement. systems burden on data providers Recommendations to strengthen the quality of data and information that grows with the number sharing mechanisms are therefore included in this policy gap analysis of differentiated data and recommendations report. These recommendations, and the requests, increases the risk analysis on which they are based, will be discussed and refined through of data errors and double- further consultation with DMRE, DFFE and industry stakeholders. counting, and impedes The current overhead required to transform energy data for different transparency. uses makes data sharing impractical, especially when multiple sets of data are requested between multiple pairs of systems. For data to be shared between the existing systems, multiple transformations are required, even though they contain similar schemas: The entity requesting the data must create a template to facilitate the requests. The entity providing the data must then transform their source data to fit the template, and the received data must then be transformed to match destination system. To enable monitoring and evaluation of energy management programs in the overarching energy management strategy, program results in EETMS, COAS and REDIS should be linked to CED. The GHG emission impact of these programmes should be identified and linked to DFFE’s GHG data management systems, whether through SAGERS H364991-00000-200-066-0006, Rev. 0 Page 15 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Function Gap Relevance DMRE or another mechanism. All data in the CED, however, is stored on a network folder and maintained by the users of the database, which impedes data sharing with other systems as they do not offer sufficient interoperability in the form of application interfaces and access control. File-based databases also don’t support reliable access by multiple simultaneous users or applications. Schematics are provided in Section 5 to depict the linkages of the current information-sharing landscape between industry stakeholders and DMRE to help inform DMRE’s planning and decision making. H364991-00000-200-066-0006, Rev. 0 Page 16 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 2.2 Recommendations to address the gaps 2.2.1 Gap 1: Lack of defined role Gap description: DMRE lacks a clearly defined role in supporting DFFE in managing the national climate change agenda. Recommendation: Formalise the current information-sharing arrangement that exists between DMRE and DFFE, including an MoU that details data collection procedures linked to roles and responsibilities for both DMRE and DFFE. A formalised procedure should determine and document DMRE’s roles and responsibilities with respect to South Africa’s GHG inventory. Different models for engaging with the Inventory Lead Agency (which in South Africa is the DFFE) should be identified and evaluated. At a minimum, all government entities responsible for creating GHG emission reductions through their programs should have a streamlined reporting framework for sharing GHG emission reduction results so that the Lead Inventory Agency can monitor and evaluate GHG reductions at a national level. DMRE should engage with DFFE to help create, or propose, roles and procedures for providing this data to DFFE that are aligned to other GHG reduction reports from departments and agencies outside of DMRE. 2.2.2 Gap 2: Lack of mechanism to compile and evaluate GHG emissions reductions associated with DMRE programs Gap description: There is no mechanism to compile and evaluate the GHG emission reductions associated with the carbon management-related programs led by DMRE i.e., energy efficiency, renewable energy, and carbon offsets Recommendation: DMRE should have a formal procedure for regularly (e.g., annually) reporting the impact of its programs, specifically those relating to energy efficiency, renewable energy, and carbon offsets, on the national GHG inventory. Such reporting will require DMRE to implement a process for calculating and evaluating the GHG reductions associated with its programs. Aligning its own energy data compilation templates for data providers with DFFE’s GHG reporting requirements will facilitate DMRE in monitoring the carbon intensity of the national energy balance. It will also help reduce reporting fatigue on the part of data providers. GHG reductions associated with DMRE programs should be corroborated with the national GHG inventory to evaluate the impact of these programs on South Africa’s GHG stabilisation goals. 2.2.3 Gap 3: Lack of systems to monitor GHG reductions associated with energy and offset strategies Gap description: There are currently no systems and procedures to monitor and evaluate GHG emission reductions associated with energy management and offset strategies. H364991-00000-200-066-0006, Rev. 0 Page 17 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Recommendation: DMRE should map energy efficiency goals, targets and initiatives outlined in the IRP, IEP and NEES to corresponding GHG reduction goals, targets and initiatives managed by DFFE to identify synergies and inconsistencies and create a strategy for addressing the latter, including potential updates to the IEP. When finalising regulations, DMRE should align categories of data providers (A-G) in the Mandatory Provision of Energy Data regulations provided with the classification of data providers in these regulations. DMRE should also consider aligning energy consumption thresholds with other energy and GHG reporting requirements. DMRE may wish to consider requesting the associated GHG impacts of these EMPs, subject to consultation with industry, to ensure that this effort wouldn’t be duplicative with DFFE’s GHG reporting requirements. Alternatively, DMRE could create a system and procedure for modelling an order of magnitude GHG impact associated with each plan. This system should use the same emission factors as SAGERS. Current GHG reduction-related tracking systems such as the EETMS and the COAS should be reviewed to identify opportunities to streamline the reporting and assessment of GHG data in existing systems. The evaluation of GHG emissions associated with EMPs provided by the Energy, Mining and IPPU should be aligned to the frameworks used by DFFE to evaluate GHG emissions and reductions from AFLOU and Waste. This alignment will facilitate DFFE’s evaluation of aggregated reductions from all four sectors to achieve national objectives. DMRE’s own energy programs should track and report on associated GHG emission impacts. 2.2.4 Gap 4: Unusable energy data provided to DMRE Gap description: Energy data provided to DMRE is incomplete or unusable. Recommendation: To facilitate both energy and GHG reporting, energy data requirements should be aligned with GHG reporting requirements out of DFFE. There is an opportunity to achieve this alignment through the Regulations on the Mandatory provision of Energy Data, which are currently being amended. These amendments should specify what activities would trigger a GHG data request from DMRE, so that data providers are prepared to respond appropriately to such a request, and the provision of this data should be consistent with other reporting requirements covering the same data. GHG data deemed relevant to DMRE could also be obtained from DFFE through an MoU. The regulations already make a provision for DMRE to collect data it deems relevant from another state entity, rather than directly from data providers. As the regulations do not specify a reporting system for GHG data as they do under DFFE, DMRE should use DFFE’s GHG inventory to corroborate completeness of energy data (as DFFE uses the energy balance to corroborate completeness of the GHG inventory). DMRE should also identify all energy sources making up the energy supply in South Africa and link each source to the data management system covering it. Identify data gaps for specific energy sources e.g., including off-grid energy generation and use. GHG emissions H364991-00000-200-066-0006, Rev. 0 Page 18 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 covered in DMRE legislation outside the Mandatory Provision of Energy Data e.g., the MPRDA should be identified and incorporated into evaluated to ensure these activities and the associated GHG emissions are captured in the respective national energy and GHG inventories. 2.2.5 Gap 5: Disparate, ad hoc data sharing between departments Gap description: Data sharing is based on ad hoc requests to meet specific needs, creating a burden on data providers that grows with the number of differentiated data requests, increases the risk of data errors and double-counting, and impedes transparency. Recommendation: Review energy and GHG data management systems to identify opportunities for software system linkages and other information-sharing mechanisms to mitigate the risk of inconsistent data output from different data management systems, as well as the risk of inaccurate data due to human error through manual data download and sharing procedures. A standard schema should be defined that is compatible with the energy and GHG data contained in each system so that each system only needs to implement one transformation to read and write the standard interface, as opposed to the many that currently exist. This alignment should be completed at a minimum for EETMS, REDIS, COAS and the CED. Opportunities for alignment with SAGERS should be explored. File-based databases should be migrated to modern server-based databases, which should be accessible by all stakeholders and maintained by information technology teams rather than users. The schemas of the existing databases could be ported to modern databases with relatively little effort. As SAGERS, EETMS, COAS, REDIS, and the CED handle similar structures of data, a standard schema should be defined that is compatible with the data contained in each system. Each system would then only need to implement one transformation to read and write the standard interface, rather than the many that currently exist. Architectural solutions for improved data interface can be evaluated for only those systems under DMRE’s control, or for data sharing systems across government departments, which DMRE can influence. H364991-00000-200-066-0006, Rev. 0 Page 19 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 3. Component B – A framework to close the gaps 3.1 The framework The developed framework consists of 5 elements listed in Table 3-1. For more detailed context and background refer to H364991-00000-200-066-0003 (Options Report for GHG Assessment and Reporting Framework Energy, Mining and IPPU Sectors). Table 3-1: Framework Elements 1 Formalising DMRE’s role in supporting the national GHG inventory 2 Monitoring and evaluating the GHG impact of industrial energy management plans 3 Reporting, monitoring, and evaluating the GHG impact of all DMRE’s energy and carbon intensity programs 4 Improving data compilation and management mechanisms 5 Improving data management and monitoring software systems 3.1.1 Element 1: Formalising DMRE’s role in supporting the national GHG inventory This first element proposes to establish the formal or informal institutional, legal, and procedural agreements between DFFE as the lead inventory agency and the DMRE. These institutional arrangements define the responsibilities associated with preparing the national GHG inventory, including how DMRE will provide data to the lead inventory agency. The Draft Climate Change Bill proposes a climate change secretariat, which will oversee and coordinate all activities from the different government agencies that influence climate change- related outcomes. This secretariat will be the entity that should formalize all information sharing and GHG-reduction initiatives between DFFE and DMRE. Whilst the secretariat will sit within DFFE, it will require significant input and coordination with DMRE on the energy file to achieve national GHG management goals. Currently, DMRE’s role is to provide energy data to DFFE to corroborate the completeness of the energy data DFFE has collected directly from industry. Better defined role. A more defined role for DMRE involves monitoring and evaluating the performance of its policies, plans and strategies against the climate change mitigation objectives adopted by the Government of South Africa. Pull in the same direction. DMRE’s established and future targets for reductions in energy demand and carbon intensity reductions should be aligned with and evaluated against DFFE’s GHG management plans. H364991-00000-200-066-0006, Rev. 0 Page 20 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 3.1.2 Element 2: Monitoring and evaluating the GHG impact of industrial energy management plans Once formal roles have been established, the second element focuses on improving the provision of robust energy data from industry to facilitate decisions on energy and related GHG management policies and programmes. The primary source of energy consumption data for DMRE should be obtained through the Department’s regulatory authority provided by the Draft Regulations Regarding Registration, Reporting on Energy Management and Submission of Energy Management Plans (EMPs). Understanding the shift. Decreases in higher emitting energy commodities should correspond with increases in the various renewable energy technologies. These planned increases should be aligned with the expected increase in renewable energy supply based on the REIPPP. Sum-up the plans. A procedure for modelling the GHG impact associated with each plan is proposed with the view of evaluating the impact against the national GHG inventory. This should be aggregated at the sector level. Sharing is caring. Sharing this data with DFFE will facilitate DFFE’s legislative authority to establish sector emission targets (SETs) and corporate-level carbon budgets. 3.1.3 Element 3: Reporting, monitoring, and evaluating GHG and other socio-economic impacts associated with all DMRE’s energy and carbon intensity programmes The third element focuses on monitoring and evaluating the aggregated outcomes of all DMRE programmes. Outcomes should be evaluated against DMRE’s objectives to reduce the demand and carbon intensity of the energy supply and support the Just Energy Transition. Join the dots. Programme results analysed in the Energy Efficiency Monitoring System EETMS, once populated, and the Renewable Energy Data and Information Service (REDIS) should be linked to the Central Energy Database (CED) to facilitate ongoing evaluation of the impact of DMRE’s energy demand intensity and carbon intensity reduction initiatives, including the energy efficiency programmes governed by SANEDI and the negative emissions projects (offsets) captured in the Carbon Offset Administration System (COAS). The total sum of intensity based GHG emission reduction outcomes should be accessible to DFFE to compare the year-over-year impact on the national GHG inventory. The cost per tonne of CO2e abated should be tracked and evaluated per the formula below. ∑ + ∑ + ∑ = ∑ + ∑ + ∑ H364991-00000-200-066-0006, Rev. 0 Page 21 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Where: AC = Abatement Cost; PC = Program Costs; GHG Red = GHG Reductions Further to GHG emissions, DMRE’s energy programmes have a significant impact on socio- economic development in South Africa. A key risk to manage as part of a Just Transition in South Africa is the risk that the energy transition results in unmitigated negative impacts in key sectors in the economy, particularly in the coal mining sector. DMRE has a role to play in ensuring that the energy transition pathway allows the implementation of programmes that appropriately capture and capitalise on job creation opportunities while minimising the potentially negative socio-economic impacts associated with the transition. Supporting the development of new or innovative industries or mining activities in South Africa could help to mitigate the risk of jobs destruction due to an energy transition. The REIPPPP, for example, created a small wind and solar manufacturing industry, which should be monitored for growth as manufacturing plants expand. The realisation of economic development and growth, however, requires proactive, coordinated action, such as aligning wind and solar PV build limits with national Just Transition planning, incorporating the full value of upstream and downstream opportunities associated with the renewable manufacturing industry, and creating implementable plans based on the National Planning Commission (NPC)’s Just Transition sustainable development pathways. 3.1.4 Element 4: Improving data compilation and management mechanisms The fourth element focuses on improving data sharing among government agencies to further strengthen the integrity of reported data. Streamlining access to energy data avoids the risk of using inconsistent data to inform policy decisions. Currently, energy and related GHG emissions data is collected by multiple state entities without formal information sharing mechanisms. As each entity has different compilation methodologies serving different purposes, industry is at risk of reporting fatigue due to the multiple requests for data provided in different ways. DMRE should identify all energy sources making up the energy supply in South Africa and link each source to the data management system covering it. Data compilation and management protocols should be aligned. The evaluation of GHG emissions associated with energy use in the Mining and IPPU sectors, for example, should be aligned to the frameworks used by DFFE to evaluate GHG emissions and reductions from AFLOU and Waste. This alignment will facilitate DFFE’s evaluation of aggregated reductions from all four primary emitting sectors to achieve its national GHG management objectives. Similarly, data required by international agencies such as the International Energy Agency (IEA) and the African Energy Commission (AFREC) should be aligned with DMRE’s data management protocols to ensure data shared with international bodies is consistent. H364991-00000-200-066-0006, Rev. 0 Page 22 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Talk to your neighbour. A government-wide data management protocol should be developed and implemented, organised around: i) Goals; ii) Addressing gaps between current state and desired objectives; iii) Creating a roadmap to achieve desired future state; iv) Developing a government-wide engagement strategy; and, v) appoint the champions. Creating roles and responsibilities to govern data. 3.1.5 Element 5: Improving energy and GHG data management and monitoring software systems The fifth and final element of the Framework is proposed to optimize the energy and GHG monitoring and reporting strategy through a matrix detailing synergies between DMRE’s programme software and its underlying functionalities to DFFE’s South African Greenhouse Gas Emissions Reporting System (SAGERS). The current overhead required to transform energy data for different uses even within DMRE makes data sharing impractical, especially when multiple sets of data are requested between multiple pairs of systems. For data to be shared between the existing systems, multiple transformations are required, even though they contain similar schemas. As all data in the CED is stored on a network folder and maintained by the users of the database, data sharing with other systems is impeded. Move to the cloud. File-based databases should be migrated to modern server-based databases, which should be accessible by all stakeholders and maintained by information technology teams rather than users. Organize the house. The schemas of the existing databases should be ported to modern databases with relatively little effort. As SAGERS, EETMS, COAS, REDIS, and the CED handle similar structures of data, a standard schema should be defined that is compatible with the data contained in each system. Each system would then only need to implement one transformation to read and write the standard interface, rather than the many that currently exist. Mechanisms should be considered to integrate the collection of data from external data providers with the CED directly. This is typically done through electronic forms, which could be shared with the data providers and that support the Shared Data Interface, e.g., build the User Interface, visualisations, and reports for each stakeholder in a common application. The CED and standard visualisation and reporting technology stacks would then support the information needs of all stakeholders, with decision-making informed by consistent data. 3.2 Implementing the framework In the following sections the implementation activities are mapped against the functions within DMRE or other state entities that should be Responsible, Accountable, Consulted, or Informed (RACI). The definitions of these terms are as follows:  Responsible: Functions or roles that will execute the work. H364991-00000-200-066-0006, Rev. 0 Page 23 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021  Accountable: Functions or roles that will own the work. The functions will approve and sign-off work when the task, objective or decision is complete. This function will also appoint the “responsible” roles. This role will ultimately take ownership of the success of failure of the work.  Consulted: Stakeholders of roles who need to give input before the work can be done and signed-off on.  Informed: Stakeholders who need to be kept "in the picture." They need updates on progress or decisions, but they do not need to be formally consulted, nor do they contribute directly to the task or decision. For more detailed context and background refer to H364991-00000-200-066-0004 (Framework Implementation Plan). H364991-00000-200-066-0006, Rev. 0 Page 24 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 3.2.1 Implementing Element 1: Formalising DMRE’s role in supporting the national GHG inventory Activities (2021/2022) R A C I Document DMRE’s role in supporting South Africa’s GHG CD – Environmental Branch - CD- Planning Branch - management agenda and agree on this role with the SNE management Programmes and Mining, mineral & (DFFE) projects projects energy policy development Create targets and metrics to monitor and evaluate CD – Economic Branch - CD- Planning Branch - progress toward achieving these goals and objectives analysis and Programmes and Mining, mineral & statistics projects energy policy development Create internal monitoring and reporting system for energy CD – Programmes Branch - CD- Planning Branch - demand and carbon intensity reduction outcomes and project Programmes and Mining, mineral & management office projects energy policy development Create data flows to document current state and future CD – Programmes Branch - CD- Planning Branch - improvement opportunities for data sharing protocols and project Programmes and Mining, mineral & between other state entities and to improve data reliability management office projects energy policy and completeness development Refine outdated MoU to formalise data sharing architecture CD – Programmes Branch - CD- Planning Branch - with DFFE and project Programmes and Mining, mineral & management office projects energy policy development Activities (2022/2023) R A C I Evaluate 2021/2022 demand and carbon intensity reduction CD – Economic Branch - CD- Planning Branch - data against DMRE targets analysis and Programmes and Mining, mineral & statistics projects energy policy development H364991-00000-200-066-0006, Rev. 0 Page 25 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Share data with DFFE to evaluate against GHG emission CD – Economic Branch - CD- Planning Branch - management objectives and targets analysis and Programmes and Mining, mineral & statistics projects energy policy development Refine energy supply and demand plans based on data CD- Planning Branch - CD- Economic Branch - results and DFFE consultation Mining, mineral & growth, promotion Programmes and energy policy and global relations projects development Activities (2023/2024) R A C I Align future strategies with DFFE’s GHG management CD- Economic Branch - Branch - CD- Planning strategy growth, promotion Mining, mineral & Programmes and and global relations energy policy projects development H364991-00000-200-066-0006, Rev. 0 Page 26 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 3.2.2 Implementing Element 2: Monitoring and evaluating the GHG impact of industrial energy management plans Activities (2021/2022) R A C I Implement Energy Management Plan data collection and CD – Energy Branch - Programmes CD- Economic growth, CD – Economic evaluation efficiency projects and projects promotion and global analysis and statistics CD – Programmes relations and project management office Activities (2022/2023) R A C I Evaluate year 1 EMP data to identify and address gaps CD – Energy Branch - CD – Economic CD- Economic growth, efficiency projects Mining, mineral & analysis and statistics promotion and global CD – Programmes energy policy relations and project development management office Refine EMP data collection processes where required CD – Energy Branch - CD – Economic CD- Economic growth, efficiency projects Mining, mineral & analysis and statistics promotion and global CD – Programmes energy policy relations and project development management office Activities (2023/2024) R A C I Evaluate Year 2 EMP data at the sector and national level CD – Energy Branch - CD – Economic CD- Economic growth, to determine effectiveness of energy demand and fuel efficiency projects Mining, mineral & analysis and statistics promotion and global switching strategies energy policy relations development Refine strategy where required CD- Economic growth, Branch - CD – Economic Branch - Programmes promotion and global Mining, mineral & analysis and statistics and projects relations energy policy CD – Energy CD- Planning development efficiency projects H364991-00000-200-066-0006, Rev. 0 Page 27 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Refine data compilation templates or mechanisms where CD – Energy Branch - Programmes CD – Economic Branch - Programmes required efficiency projects and projects analysis and statistics and projects H364991-00000-200-066-0006, Rev. 0 Page 28 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 3.2.3 Implementing Element 3: Reporting, monitoring, and evaluating GHG impacts associated with all DMRE’s energy and carbon intensity programmes Activities (2021/2022) R A C I Pull results from each energy and GHG related DMRE CD – Economic Branch - CD- Planning Branch - Programmes program to evaluate comparability of GHG emission analysis and statistics Mining, mineral & CD- Economic and projects reduction outcomes energy policy growth, promotion development and global relations Create protocols for organising data to enable summing of CD – Economic Branch - CD- Planning Branch - Programmes GHG abatement results against DMRE targets analysis and statistics Mining, mineral & CD- Economic and projects energy policy growth, promotion development and global relations CD – Energy efficiency projects Evaluate cost data availability to calculate cost-output ratios CD – Economic Branch - CD- Planning Branch - Programmes analysis and statistics Mining, mineral & CD- Economic and projects energy policy growth, promotion development and global relations Refine data compilation and reporting architecture as CD – Energy Branch - Programmes CD- Planning Branch - required efficiency projects and projects CD- Economic Mining, mineral & CD – Programmes growth, promotion energy policy and project and global relations development management office CD – Economic analysis and statistics Activities (2022/2023) R A C I Evaluate programme GHG abatement outcomes against CD – Economic Branch - CD- Planning Branch - Programmes targets and cost per tonne of CO2e abated analysis and statistics Mining, mineral & CD- Economic and projects energy policy growth, promotion development and global relations H364991-00000-200-066-0006, Rev. 0 Page 29 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Evaluate outcomes against DFFE’s national GHG CD – Economic Branch - CD- Planning Branch - Programmes management objectives analysis and statistics Mining, mineral & CD- Economic and projects energy policy growth, promotion development and global relations Refine strategy and targets as required CD- Planning Branch - CD – Economic Branch - Programmes CD- Economic Mining, mineral & analysis and statistics and projects growth, promotion energy policy and global relations development Activities (2023/2024) R A C I Ongoing monitoring, evaluation, and refinement of CD – Economic Branch - CD- Economic Branch - Programmes programme outcomes analysis and statistics Mining, mineral & growth, promotion and projects CD- Planning energy policy and global relations development H364991-00000-200-066-0006, Rev. 0 Page 30 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 3.2.4 Implementing Element 4: Improving data compilation and management mechanisms Activities (2021/2022) R A C I Review the national OPG strategy to identify CD – Programmes Branch - Programmes CD – Programmes Branch - opportunities for synergy with data sharing and and project and projects and project Mining, mineral & availability initiatives management office management office energy policy CD- Economic growth, CD – Economic development promotion and global analysis and statistics relations Conduct jurisdictional scan to identify opportunities to CD – Programmes Branch - Programmes CD – Programmes Branch - leverage best practices from other regions on data and project and projects and project Mining, mineral & sharing initiatives management office management office energy policy CD- Economic growth, CD – Economic development promotion and global analysis and statistics relations Create data flows for all energy sources making up the CD – Programmes Branch - Programmes CD – Economic Branch - national energy supply and link each source to the and project and projects analysis and statistics Mining, mineral & data management system covering it management office energy policy development Identify energy and GHG emission data duplications CD – Programmes Branch - Programmes CD – Programmes Branch - and gaps and project and projects and project Mining, mineral & management office management office energy policy CD- Economic growth, development promotion and global relations Evaluate comparability of energy and GHG data CD- Economic growth, Branch - Programmes CD – Programmes Branch - reporting and assessments between state entities promotion and global and projects and project Mining, mineral & relations management office energy policy development Activities (2022/2023) R A C I H364991-00000-200-066-0006, Rev. 0 Page 31 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Develop and implement strategy to streamline CD – Programmes Branch - Programmes CD- Economic growth, Branch - duplications and close gaps and project and projects promotion and global Mining, mineral & management office relations energy policy CD – Economic development analysis and statistics Create and formalize data management protocol CD – Programmes Branch - Programmes CD- Economic growth, Branch - and project and projects promotion and global Mining, mineral & management office relations energy policy CD – Economic development analysis and statistics Identify DMRE’s role for each of the relevant datasets CD – Programmes Branch - Programmes CD- Economic growth, Branch - within the data management protocol and project and projects promotion and global Mining, mineral & management office relations energy policy CD – Economic development analysis and statistics Create data governance mechanisms to manage data CD – Programmes Branch - Programmes CD- Economic growth, Branch - and project and projects promotion and global Mining, mineral & management office relations energy policy CD – Economic development analysis and statistics Activities (2023/2024) R A C I Ongoing monitoring and evaluation of energy and CD – Economic Branch - Programmes CD- Planning Branch - associated GHG and socio-economic data analysis and statistics and projects Mining, mineral & CD- Economic growth, energy policy promotion and global development relations H364991-00000-200-066-0006, Rev. 0 Page 32 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 3.2.5 Implementing Element 5: Improving energy and GHG data management and monitoring software systems Step 1: Identify opportunities for software system linkages and other information-sharing mechanisms A diligent study of current workflows is required to inform the design and implementation of a common data environment. Activities (2021/2022) R A C I Develop detailed system architecture showing available CD – Programmes Branch - Programmes CD – Economic CD- Economic data interfaces, automated processes, or manual workflows and project and projects analysis and statistics growth, promotion management office and global relations for data sharing between systems Identify the data flow, i.e., what data is supplied to whom, CD – Programmes Branch - Programmes CD – Economic CD- Economic how, when, and for what purpose1 and project and projects analysis and statistics growth, promotion management office and global relations Identify data and data format managed by DMRE along CD – Programmes Branch - Programmes CD – Economic CD- Economic with the application in which the data is managed, the data and project and projects analysis and statistics growth, promotion management office and global relations type, and data format required for DMRE but other stakeholders Identify all calculations, quality checks, processes, or any CD – Programmes Branch - Programmes CD – Economic CD- Economic manipulation of the data by DMRE and project and projects analysis and statistics growth, promotion management office and global relations Activities (2022/2023) R A C I Develop a data flow model for the transition from legacy CD – Programmes Branch - Programmes CD – Economic CD- Economic systems to a cloud hosted solution set that is coordinated and project and projects analysis and statistics growth, promotion management office and global relations with the stakeholders so that all data sharing requirements are captured for all stakeholders2 1 This data flow should be a detailed analysis showing the relationships and timing of data required for DMRE, for the stakeholders, and between DMRE and the stakeholders as they are often different based on use case for the data. 2 This data flow model should identify all required data manipulations, calculations, interventions, and procedures required for DMRE and for stakeholders. H364991-00000-200-066-0006, Rev. 0 Page 33 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Develop a workflow specification for data collection and use CD – Programmes Branch - Programmes CD – Economic CD- Economic by relevant stakeholders which identifies the uses cases of and project and projects analysis and statistics growth, promotion management office and global relations the data, required interactions of stakeholders, and timing issues between stakeholders3 Develop a data specification to synchronize, conform, and CD – Programmes Branch - Programmes CD – Economic CD- Economic standardize data formats with recommendations for and project and projects analysis and statistics growth, promotion management office and global relations eliminating any duplications4 Activities (2023/2024) R A C I Deploy the cloud hosted solution technology stack and CD – Programmes Branch - Programmes CD – Economic CD- Economic develop any required Application Interfaces (API) to and project and projects analysis and statistics growth, promotion management office and global relations connect the DMRE CED to stakeholder applications Step 2: Migrate file-based databases to a modern common data environment (CDE) Existing data sets should be available going forward and systems that are replaced should be discontinued. Activities (2021/2022) R A C I Prepare a roadmap for the transition of the identified CD – Programmes Branch - Programmes CD – Economic CD- Economic and project and projects analysis and statistics growth, promotion disparate systems connected to a DMRE Common Data management office and global relations Environment (CDE) supported by analysis, visualization, 3 DMRE should support documentation of stakeholder use cases for the data and then align these use cases trying to eliminate any duplication. 4 The intent of the data specification is to prepare data sets to move into a Common Date Environment (CDE) so that the single instance of the data is available for use case development, i.e., DMRE data is entered once, in a defined format, to be shared. If stakeholder data is similar then comparative analysis can be designed for merging, prioritization, or selection, or any combination of these, for determination of best data source for DMRE use cases. This process may result in a conversion process of stakeholder input and output data so that it does not impact stakeholder legacy systems but ideally it results in a change to the stakeholder systems to align with the CDE. H364991-00000-200-066-0006, Rev. 0 Page 34 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 and reporting technologies, e.g., DMRE Azure cloud hosted data platform and MS PowerBI development application Activities (2022/2023) R A C I Prepare data governance and oversight procedures for all CD – Programmes Branch - Programmes CD – Economic CD- Economic data sets coordinating data requirements between all and project and projects analysis and statistics growth, promotion management office and global relations stakeholders and the identified technology stacks Activities (2023/2024) R A C I Deploy the CDE and supportive technology stack for DMRE CD – Programmes Branch - Programmes CD – Economic CD- Economic and project and projects analysis and statistics growth, promotion management office and global relations Step 3: Evaluate implementation of a CDE for data sharing systems across government departments To share data effectively with all stakeholders, the Common Data Environment should be directly accessible. Activities (2021/2022) R A C I Prepare a roadmap for the transition of the identified CD – Programmes Branch - Programmes CD – Economic CD- Economic disparate systems connected to a DMRE Common Data and project and projects analysis and statistics growth, promotion and management office global relations Environment (CDE) Identify migration plans required for other departments to CD – Programmes Branch - Programmes CD – Economic CD- Economic and project and projects analysis and statistics growth, promotion and take advantage of the DMRE CDE management office global relations Activities (2022/2023) R A C I H364991-00000-200-066-0006, Rev. 0 Page 35 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Repeat the process of defining the system architectures, data specifications, workflow specifications, and data CD – Programmes CD- Economic Branch - Programmes CD – Economic governance and oversight procedures for other government and project growth, promotion and and projects analysis and statistics management office global relations departments joining the CDE Activities (2023/2024) R A C I CD – Programmes CD- Economic Branch - Programmes CD – Economic Migrate other departments to the DMRE CDE and project growth, promotion and and projects analysis and statistics management office global relations 3.2.6 Enabling a Just Energy Transition (JET) While the development of a Just Energy Transition is complex and involves dialogue and coordination between different government institutions and public and private stakeholders (which are outside the scope of activities included in the Terms of Reference), the following activities could be considered to support and complement the efforts required to develop and implement a Just Energy Transition. Activities (2021/2022) R A C I Refine and finalise a clear definition of the JET with a CD- Economic Branch - CD – Programmes CD – Economic framework disseminated to industry for feedback growth, promotion Mining, mineral & and projects analysis and and global relations energy policy management office statistics development Branch - Programmes and projects Provide industry with a target date to when JET-related policies CD- Economic Branch - CD – Programmes CD – Economic growth, promotion Mining, mineral & and projects analysis and can be expected and global relations energy policy management office statistics development CD- Planning Branch - Programmes and projects H364991-00000-200-066-0006, Rev. 0 Page 36 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Establish a dedicated JET office within the DMRE with CD – Programmes Branch - Branch - CD – Economic appropriate political mandate, budget, staff, and resources to and projects Mining, mineral & Programmes and analysis and management office energy policy projects statistics drive and support in the implementation of the JET strategy CD- Economic development CD- Planning growth, promotion and global relations Establish a communication platform from which the DMRE can CD – Programmes Branch - CD- Economic CD- Planning effectively communicate and engage with industry regarding and projects Mining, mineral & growth, promotion management office energy policy and global relations the implementation of the JET development CD – Economic analysis and statistics Develop a comprehensive verified knowledge database of the CD – Programmes Branch - CD- Economic CD- Planning coal mining industry in terms of coal worker skills, employee and projects Programmes and growth, promotion Branch - management office projects and global relations Mining, mineral & numbers, coal life of mine plans etc. CD – Economic energy policy analysis and development statistics Assess the future planned industrial development within the CD- Economic Branch - CD- Planning Branch - Mpumalanga and Limpopo provinces that could provide growth, promotion Mining, mineral & Mining, mineral & and global relations energy policy energy policy alternative job opportunities for coal industry workers CD – Economic development development analysis and statistics Collaborate with other government agencies to align on and Branch - Branch - CD- Economic Branch - support relevant initiatives driven by e.g., Department of Trade Mining, mineral & Mining, mineral & growth, promotion Programmes and energy policy energy policy and global relations projects and Industry, Department of Public Enterprises etc. development development CD – Economic analysis and statistics CD- Planning H364991-00000-200-066-0006, Rev. 0 Page 37 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Establish a partnership with the Department of Basic Education CD - Programmes Branch - CD – Economic CD- Economic to ensure the younger generation are appropriately equipped and project Programmes and analysis and growth, promotion management office projects statistics and global relations for jobs that support the lower carbon energy supply of the future Assess the national energy balance exposure to social (e.g., CD – Economic Branch - CD- Economic Branch - job loss) risks, such as job losses associated with coal-fired analysis and Mining, mineral & growth, promotion Programmes and statistics energy policy and global relations projects power plants decommissioned compared to the number of jobs development that can be created in new energy-related industries Engage with the NPC to support consultation with relevant CD - Programmes Branch - CD- Economic Branch - stakeholders on employment opportunities for communities and project Programmes and growth, promotion Mining, mineral & management office projects and global relations energy policy affected by the energy transition, as well as previously CD – Economic development marginalized communities. analysis and statistics Identify barriers to lower carbon energy uptake such as cultural CD - Programmes Branch - CD- Economic Branch - and awareness impediments and project Programmes and growth, promotion Mining, mineral & management office projects and global relations energy policy CD – Economic development analysis and statistics Assess and monitor progress in executing the JET strategy. CD – Economic Branch - CD- Economic Branch - analysis and Mining, mineral & growth, promotion Programmes and statistics energy policy and global relations projects development CD- Planning Activities (2022/2023) R A C I Integrate findings from activities above into energy project CD- Planning Branch - CD- Economic CD - Programmes development strategy Mining, mineral & growth, promotion and project energy policy and global relations management office development H364991-00000-200-066-0006, Rev. 0 Page 38 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Branch - Programmes and projects Assess the social impact strategies of companies associated CD – Economic Branch - CD- Economic Branch - with potential early closures of fossil-fuel derived assets analysis and Mining, mineral & growth, promotion Programmes and statistics energy policy and global relations projects development CD- Planning Create and monitor job creation and protection metrics for all CD – Economic Branch - CD- Economic Branch - energy supply infrastructure analysis and Mining, mineral & growth, promotion Programmes and statistics energy policy and global relations projects development CD- Planning Activities (2023/2024) R A C I Identify and create competitive frameworks for investment in CD - Programmes Branch - Branch - CD- Planning lower carbon energy development to overlay programmes such and project Programmes and Mining, mineral & CD – Economic management office projects energy policy analysis and as the REIPPPP with a socio-economic development CD- Economic development statistics component. growth, promotion and global relations Identify and drive investment in infrastructure required to CD- Economic Branch - CD - Programmes CD- Planning growth, promotion Mining, mineral & and project CD – Economic support new industries e.g., manufacturing, transmission and and global relations energy policy management office analysis and distribution, integration of hydrogen, etc. development statistics Assess a potential role for DMRE in a strategy for investing CD- Economic Branch - CD - Programmes CD- Planning national revenues back into low carbon energy development growth, promotion Mining, mineral & and project and global relations energy policy management office (see Box 4-1 for an example) CD – Economic development analysis and statistics Share lessons learned with other national governments to CD- Economic Branch - CD – Economic CD - Programmes identify opportunities for improvement growth, promotion analysis and and project and global relations statistics management office H364991-00000-200-066-0006, Rev. 0 Page 39 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Mining, mineral & CD- Planning energy policy development H364991-00000-200-066-0006, Rev. 0 Page 40 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 3.3 Modernising the data management systems The current state of data management and monitoring software requires DMRE to transform energy data supplied from external stakeholders, and even within DMRE. Data entry is:  Often duplicated between inputs required for DMRE and DFFE purposes;  Transformed by DMRE users differently when a single transformation is required, i.e. calculations are repeated or different between uses cases where they should be the same;  Stored in disparate data locations, i.e., in siloed files, often spreadsheets customized for the transformation use case, and stored on local hard drives in unmanaged directory tree structures;  Manually aggregated into the DMRE Central Energy Database (CEE) by DMRE users requiring manual intervention to align transformations, data formats, and outputs to compile, evaluate, report, and manage energy and mining data. This requires significant coordination between DMRE departments where it could and should automated with data management processes;  In the DMRE CED, which is a Microsoft Access database that is now obsolete, unsupported and at significant risk of failure, i.e. from upgrade conflicts with advancing operating systems (window updates), from security threats (malware/phisher/ransomware) , and non-compliance to advancing hardware platform standards for software solutions (firmware). This process makes data management and sharing impractical. The process makes data:  Difficult to share. As all data in the CED is stored on a network folder and maintained by the users of the database, making data sharing with other systems difficult and results in conflicting data management processes.  Susceptible to manual errors, especially when multiple sets of data are requested between multiple parties and systems;  Conformity, or standardized data format, impossible to manage as data is not controlled; there are several potential sources for the same, or similar, data or data transformations, e.g., in a document management system, controlled documents (or sources of data) are not sent via emails but only links to the document source is shared so that the document can be controlled. This concept should be applied to data to enable effective data management;  Data entry and format, i.e., data type (text, numeric, alphanumeric), number of characters, etc) rules are difficult to maintain as data is entered at many locations by many users;  Management processes are more complex as they must be duplicated; H364991-00000-200-066-0006, Rev. 0 Page 41 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021  Transformation process, e.g., calculations or amalgamations of data sets, are reputative as they are completed in the disparate data locations by different users for similar purpose, and if changed are not reflected in other systems;  Susceptible to data loss with data stored on multiple unsecure file locations;  Prone to cybersecurity threats as is it an unmanaged system with multiple entry points. DMRE’s challenge is also that Industry data providers are required to complete data entries for different use case, i.e., for DMRE and for DFEE, even though they contain similar data, leaving the impression that entry is duplicated and an unnecessary burden on Industry. To address these challenges and deliver an improved data monitoring and reporting system, it is recommended that the existing DMRE CED file-based siloed databases be migrated to modern integrated server-based databases, i.e., a cloud-based solution with a common user interface(s) available to all stakeholders for data entry, maintained by information technology teams rather than users. This new DMRE data management and reporting system would be coordinated with other required data entry systems, e.g., the DFFE SAGGERS portal, to eliminate duplicate data entry, giving the stakeholders a “single source of truth’ impression to the stakeholders as shown below. Figure 3-1: Simplified recommended systems structure More context and a detailed implementation plan can be found in the Digital framework for improving GHG data management and monitoring software (H364991-00000-200-066-0004) document. H364991-00000-200-066-0006, Rev. 0 Page 42 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Addendum A: Gap Analysis on Policy, Legislation, and Institutional Arrangements (H364991-00000-200-066-0001) H364991-00000-200-066-0006, Rev. 0 Page 43 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Addendum B: Gaps and Recommendations for Managing National GHG and Energy Data at DMRE (H364991-00000-200-066-0002) H364991-00000-200-066-0006, Rev. 0 Page 44 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Addendum C: Options Report for a GHG Assessment and Reporting Framework Energy, Mining and IPPU Sectors (H364991-00000-200-066-0003) H364991-00000-200-066-0006, Rev. 0 Page 45 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Addendum D: Framework Implementation Plan (H364991-00000-200-066-0005) H364991-00000-200-066-0006, Rev. 0 Page 46 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents. Greenhouse Gas (GHG) Reporting and Assessment Framework for the Mining and Energy Sectors in South Africa Framework Summary Report November 30, 2021 Addendum E: Digital Framework for Improving GHG Data Management and Monitoring Software Systems Implementation (H364991-00000-200-066-0004) H364991-00000-200-066-0006, Rev. 0 Page 47 © Hatch 2021 All rights reserved, including all rights relating to the use of this document or its contents.