Out-Law News 1 min. read
02 Aug 2022, 9:58 am
The Australian government has appointed an independent group to review the integrity of Australian Carbon Credit Units (ACCUs), the country’s credit system for voluntary carbon reduction measures.
ACCUs are issued under the Carbon Credits (Carbon Farming Initiative) Act 2011. They are a financial tool granted to eligible energy efficiency, renewable energy generation and carbon storage projects which reduce greenhouse gas (GHG) emissions. One ACCU equates to the removal of one tonne of carbon dioxide equivalent of GHG.
The Australian government backs reducing GHG emissions across the country by scoring ACCUs and purchasing ACCUs from businesses via the Emissions Reduction Fund (ERF).
According to a statement by the Australian government, the review group will evaluate and advise on whether scheme administration is appropriate, whether the methods for generating ACCUs meet integrity standards for offset, and any other matters the group consider relevant to the integrity of the ACCU system.
The group will also evaluate the extent to which carbon projects have supported positive environmental, social, and economic outcomes for agriculture, biodiversity, and First Nations peoples' participation; what opportunities exist to maximise the non-carbon benefits of projects, and the requirements for using ACCUs to obtain certification under Australia’s Climate Active programme.
The purpose of this review is to ensure that ACCUs and Australia’s carbon crediting framework as a whole maintain a strong reputation supported by participants, purchasers and the broader community.
George Varma of Pinsent Masons said: “ACUUs will certainly help carbon capture and carbon reduction projects in the Australian market. We are seeming similar regimes being deployed in the UK, which has greatly assisted with expediting the growth of the CCS/CCUS market in particular. This regime will also help to expedite the growth of the bioenergy and energy from waste projects as the benefits from developing these types of projects all of a sudden becomes more broad reaching and financially compelling.”
The review will incorporate public consultation via written submissions and meetings with a wide range of groups with an interest or expertise in the operation of the carbon credit market. The review group will submit a final report within six months of the start date, to include include findings and recommendations to address any identified issues.
According to a FT report, Australia’s new Labor government will launch an emission trading scheme in 2023 which will be effective on 1 July 2023. The Labor party won the election in May and has raised Australia’s 2030 emissions reduction target under the Paris agreement to 43% up from 26% to 28%.
“ACCUs will be certainly boost Australia’s decarbonisation efforts and assist with achieving our emission reduction targets and promote the growth of a broader renewable energy and decarbonisation market, ” Varma said.
09 Oct 2021