Climate Change Assessments Required for Environmental Permits
Written by Black Hot Fire Network Team on February 3, 2026
South African environmental law is undergoing a significant shift in how climate change is considered when making decisions about environmental authorizations (EA). Courts are increasingly recognizing climate change as a key factor in assessing whether a project is “needed and desirable,” particularly for fossil-fuel developments, under the National Environmental Management Act (NEMA). This legal trend coincides with the release of a draft national guideline aimed at standardizing climate change considerations in EA applications.
Two recent court decisions, Green Connection NPC and Another v Minister of Forestry, Fisheries and the Environment and Others and South Durban Community Environmental Alliance and Another v Minister of Forestry, Fisheries and the Environment and Others, highlight the importance of thorough climate change impact assessments. However, a pending appeal in the Green Connection case introduces legal uncertainty regarding when, and to what extent, these assessments are required, especially during the exploration phase of petroleum projects.
The current regulatory framework
Section 24O of NEMA, alongside the Environmental Impact Assessment Regulations of 2014, requires applicants to justify the “need and desirability” of a proposed development. This assessment must balance current needs with the rights of future generations and considers South Africa’s climate change commitments. Competent authorities are obligated to consider all relevant factors, including guidelines, policies, and other pertinent information, when making EA decisions. While climate change considerations are mandatory, they are not the sole determining factor and must be weighed against other factors like economic development and energy security.
The Constitutional Court’s ruling in Fuel Retailers Association of Southern Africa v Director-General Environmental Management established that failing to consider relevant environmental impacts can render administrative decisions reviewable. This principle was further reinforced in Earthlife Africa Johannesburg v Minister of Environmental Affairs, emphasizing the need for formal expert climate change impact assessments. The Sustaining the Wild Coast NPC and Others v Minister of Mineral Resources and Energy and Others case extended this reasoning to fossil-fuel projects, requiring assessments to consider the entire lifecycle of a project, including exploration and production.
Green Connection and unresolved questions of scope and timing
The Green Connection case involved a successful review of an EA granted to TotalEnergies EP South Africa for offshore oil and gas exploration. The Western Cape High Court found the environmental impact report deficient for failing to quantify greenhouse gas emissions, consider renewable energy alternatives, and adequately explain mitigation measures. The court rejected the argument that climate change assessments could be deferred until the production phase, asserting that exploration and production are interconnected and require meaningful climate consideration from the start.
However, the Supreme Court of Appeal has granted leave to appeal this decision, specifically concerning whether climate change impact assessments, including Scope 3 emissions, are required at the exploration phase or only at the production phase. This creates uncertainty for petroleum companies regarding the timing and scope of required assessments. The precedent set by the Supreme Court of Appeal could impact other extractive industries.
SDCEA on mandatory considerations of renewable energy alternatives
In SDCEA, the Supreme Court of Appeal addressed an EA granted to Eskom for a proposed gas-to-power plant. The applicants argued the assessment inadequately considered GHG emissions and renewable energy alternatives. While acknowledging the relevance of the Integrated Resource Plan (IRP), the court ruled that it cannot override NEMA’s requirement to assess climate change impacts and consider reasonable alternatives, including the “no-go” option. This underscores that compliance with energy policy alone is insufficient and that climate change considerations must be substantively addressed in every EA decision.
Scope 3 emissions and proportionality
Assessing Scope 3, or downstream combustion, emissions remains a contentious issue. A recent UK Supreme Court decision in R (on the application of Finch) v Surrey County Council stated that Scope 3 emissions must be assessed when they are an inevitable consequence of a development. However, this case involved a production project where combustion was certain, unlike early exploration phases where discovery and end-use are speculative.
Given these uncertainties, a proportional, tiered assessment regime is needed, aligning the administrative burden with the level of technical certainty. Early exploration activities, typically involving limited direct emissions, should not require speculative Scope 3 quantification without confirmed discovery.
Protection of existing rights and regulatory sequencing
The Draft National Guideline requires consideration of climate-related financial risks. This raises concerns that existing exploration and production rights may be indirectly constrained through the EA process. Climate considerations must be balanced against constitutional imperatives, including development, energy security, and job creation.
The Climate Change Act 22 of 2024, specifically sections 26 and 27, which establish the framework for listed GHGs and carbon budgets, is not yet in operation, adding further uncertainty for long-term investment planning.
Directors’ duties and climate risk
These developments have implications for corporate governance. Directors are expected to manage climate-related risks as part of their duties, and failing to adequately address these risks in assessments may expose boards to legal claims. Boards considering fossil-fuel projects must ensure climate risks, mitigation measures, and renewable alternatives are properly evaluated.
The path forward
Recent court decisions have reinforced the importance of climate change impact assessments in EA decision-making. Courts expect meaningful engagement with GHG emissions, renewable alternatives, and long-term sustainability. The Draft National Guideline is expected to provide regulatory certainty by clarifying assessment methodologies.
A differentiated approach is recommended, with streamlined screening for early exploration focused on Scope 1 and 2 emissions, more focused assessment for invasive exploration, and comprehensive Scope 3 quantification and climate scenario analysis for production and development applications.
