"The paper reviews previous work at national and sectoral level. Previous work on mitigation potential included the LTMS, on consideration of which Cabinet outlined its vision and strategic direction for emissions to peak, plateau and decline. Previous work directly on carbon budgets was commissioned by WWF, outlining the approach for a low-carbon action plan. The report suggested an important principle for allocation, namely that sectors should motivate for their share of the NCB based on the best used, in particular the most carbon-effective contribution to South Africa’s development needs. The paper examines analytical tools based on work in South Africa, to model the energy economy as a system. Currently, GHG1 emissions are rising rapidly and this trend needs to be reversed if we are to avoid the worst impacts of climate change. There are various ways to frame this problem. Methodologically, the problem of mitigation has typically been framed as one of reducing emissions from a business-as-usual (BAU) projection, assuming no climate policy. In this framing, the question of equity is about sharing amongst countries the effort of reducing the global emissions pathway to one which will keep us within safe limits. More recently, a different approach has emerged, which sets a global limit on cumulative emissions to 2050, and seeks to divide the remaining future ‘carbon budget’ between countries. The scientific principle that supports the concept of a ‘carbon budget’ is that climate change is driven by the concentration of greenhouse gases (GHGs) in the atmosphere. It is changes to the stock of GHGs in the atmosphere that determine radiative forcing, which together with indirect feedbacks through the coupled ocean-atmosphere system leads to temperature increase. Stock changes are driven by cumulative global emissions over time, that are the root cause of climate change."