How the US-Israel-Iran conflict is reshaping South Africa’s coal exports

The escalating US-Israel-Iran conflict has inadvertently boosted demand for South African coal, creating a complex legal and policy dilemma for the nation. This surge in coal exports, while offering short-term economic gains, directly challenges South Africa's robust climate change commitments under the Paris Agreement and its recently enacted Climate Change Act 22 of 2024. The article explores the tension between economic imperatives and constitutional environmental rights, particularly in light of recent landmark court judgments that have affirmed the state's obligation to protect a healthy environment. It highlights the regulatory tightrope South Africa must walk, balancing international trade obligations with domestic climate governance and the principles of a just transition.

The geopolitical landscape, particularly the heightened tensions stemming from the US-Israel-Iran conflict, has sent ripples through global energy markets, leading to a significant uptick in demand for thermal coal. South Africa, a major coal producer, finds itself in a precarious position as this increased international demand translates into a boost for its coal exports. While this surge offers a potential economic boon, it simultaneously intensifies the legal and policy challenges confronting the nation's ambitious climate change agenda and its commitment to a just energy transition. The Mail & Guardian's observation that Middle East tension has pushed up energy prices and boosted demand for South African coal underscores this critical juncture, raising profound questions about the country's climate commitments and export strategies.

South Africa's energy sector has historically been heavily reliant on coal, which accounts for approximately 70% of its installed power generation capacity and provides significant employment. This reliance has long been a point of contention with the country's international climate obligations. Under the Paris Agreement, South Africa submitted an updated Nationally Determined Contribution (NDC) in September 2021, committing to reduce greenhouse gas emissions to a target range of 398-510 MtCO2e by 2025 and 350-420 MtCO2e by 2030, with a long-term goal of net-zero emissions by 2050. However, these targets have been rated as 'Insufficient' by the Climate Action Tracker, indicating a need for substantial improvements to align with the 1.5°C temperature limit.

Domestically, South Africa's commitment to environmental protection is enshrined in Section 24 of the Constitution of the Republic of South Africa, 1996, which grants everyone the right to an environment that is not harmful to their health or well-being and obliges the state to protect the environment through reasonable legislative and other measures. This constitutional mandate is operationalised through key legislation such as the National Environmental Management Act 107 of 1998 (NEMA), which provides the overarching framework for environmental governance. A significant recent development is the Climate Change Act 22 of 2024, assented to in July 2024 and effective from March 17, 2025. This Act introduces legally binding sectoral emission targets, carbon budgets for major emitters, and integrates climate change considerations across all spheres of government, fundamentally shifting South Africa's climate response from policy to enforceable law. Furthermore, the Presidential Climate Commission adopted a Just Transition Framework in July 2022, aiming to manage the socio-economic impacts of decarbonisation, particularly on coal-dependent communities.

The current surge in coal exports, driven by global energy market disruptions, presents a direct challenge to the legal frameworks and commitments outlined above. While the Mineral and Petroleum Resources Development Act 28 of 2002 (MPRDA) governs the sustainable development of mineral resources, and the Department of Mineral Resources and Energy (DMRE) issues export permits, the environmental implications of increased coal extraction and combustion are profound. The Climate Change Act 22 of 2024, with its mandate for sectoral emission targets and carbon budgets, creates a legal imperative for reducing greenhouse gas emissions. Increased coal exports, by contributing to global emissions, could be seen as undermining the spirit, if not the letter, of South Africa's NDCs and the objectives of its new climate legislation.

Recent judicial pronouncements have significantly strengthened the enforceability of environmental rights in South Africa. In the landmark 'Deadly Air' case (groundWork and Vukani Environmental Movement v Minister of Environmental Affairs), the High Court ruled in March 2022 that the government's failure to improve air quality in Mpumalanga, primarily due to coal-fired power generation, violated Section 24(a) of the Constitution. More recently, in December 2024, the High Court in the '#CancelCoal' case (African Climate Alliance et al. v Minister of Mineral Resources & Energy et al.) declared the government's plan to procure 1,500 MW of new coal-fired power unconstitutional, unlawful, and invalid, citing violations of constitutional rights and inadequate consideration of environmental and health impacts. These judgments underscore a judicial willingness to hold the state accountable for its environmental obligations, even when faced with arguments of energy security or economic necessity.

The tension is further exacerbated by the government's stated position on export controls. While South Africa has mechanisms for export permits and can restrict exports to support beneficiation strategies, Trade Minister Parks Tau has indicated that imposing sanctions on countries like Israel, which has seen an increase in South African coal imports following Colombia's ban, without a United Nations resolution, would violate World Trade Organisation (WTO) principles. This stance highlights a potential conflict between international trade obligations and domestic moral or environmental imperatives, particularly as activists argue that WTO rules allow for exceptions. The Draft Mineral Resources Development Amendment Bill, 2025, currently under public comment, seeks to amend the MPRDA with a renewed emphasis on beneficiation and potential export controls, which could provide a future mechanism for greater state oversight on mineral exports, including coal.

This situation reveals a critical gap between South Africa's ambitious climate policy and the immediate economic pressures and geopolitical realities. The 'just transition' framework, which aims to ensure that the shift away from fossil fuels is equitable and inclusive, becomes particularly challenging when short-term economic opportunities from coal exports emerge. The legal framework is increasingly robust in demanding climate action and environmental protection, but the practical implementation faces significant headwinds from global market forces and the inherent complexities of transitioning a coal-dependent economy.

The current geopolitical climate has placed South Africa at a crossroads, where the immediate economic benefits of increased coal exports clash directly with its binding climate change commitments and constitutional obligations. Practitioners in environmental law, energy law, and international trade must navigate this increasingly complex landscape. The coming months are likely to see heightened scrutiny of coal export decisions, potentially leading to further climate litigation challenging government actions or inactions that are perceived to undermine environmental rights or climate targets. Companies involved in the coal value chain will need to conduct rigorous due diligence, not only on traditional regulatory compliance but also on their alignment with South Africa's NDCs, the Climate Change Act, and the principles of a just transition, as the legal and reputational risks of non-compliance or perceived climate inaction continue to grow. The government's response to this tension, whether through new export regulations, stricter enforcement of environmental laws, or a re-evaluation of its trade policies, will be crucial in shaping South Africa's legal and economic trajectory.