Australia’s major emitters could soon have the opportunity to publish the details of carbon offsets they have purchased, alongside their annual greenhouse gas emissions, under a new proposal being considered by the Clean Energy Regulator.
While few details about the proposed carbon offsets report are currently publicly available, it is understood that the Clean Energy Regulator will soon be launching a process of consultation on a new reporting scheme to allow corporate emitters to detail their purchases of carbon offsets.
Around 420 of Australia’s largest greenhouse gas emitters are required to report their annual emissions and energy use, with the information published under the National Greenhouse and Energy Reporting (NGER) scheme administered by the regulator.
The NGER scheme has provided valuable insight into the emissions footprints of Australia’s largest emitters, and details how a significant proportion of Australia’s emissions are caused by a handful of the country’s largest energy companies.
But to date, the NGERs reporting scheme does not take into account any of the carbon offsets that may have been purchased by major emitters to help reduce their overall emissions footprint.
Companies are currently able to report on the amount of electricity purchased from accredited GreenPower providers as part of their energy use reporting, and a carbon offsets report could work in a similar way for emissions reporting under the NGER scheme.
Federal energy and emissions reduction minister Angus Taylor, flagged the creation of such a reporting scheme for voluntary carbon offsets in an address to the Australasian Emissions Reduction Summit held in December.
“Climate active has been one of the ways of demonstrating accountability for progress, particularly for companies not covered by NGERs. Participants in Climate Active will be encouraged to buy Australian and to purchase ACCUs because of their high integrity, and local co-benefits,” Taylor told the summit in December.
“The Clean Energy Regulator will also begin to publish the progress that NGERs covered businesses are making towards their commitments and that tracker will be made available for reporting in the 2021 financial year.”
With a growing number of corporate emitters setting their own targets to reduce emissions, many are turning to voluntary carbon markets to buy emissions reductions from offset projects to help achieve these targets.
Telecommunications giant Telstra announced last year that it had become officially certified as carbon neutral, which had largely been achieved through the purchase of offset permits.
Oil and gas company Shell also announced the acquisition of Australian carbon offsets firm Select Carbon last year, as the company expands into the clean energy and low carbon space.
A proposed carbon offsets report, overseen by the Clean Energy Regulator, could be a way to provide greater visibility of carbon offset purchases, and may contribute to the further development of voluntary carbon markets in Australia.
The Clean Energy Regulator already oversees the creation of Australian Carbon Credit Units (ACCUs), from eligible carbon offset projects, and which some companies have used to reduce their overall emissions footprint.
“The Carbon Offsets Report will be underpinned by the NGER scheme and will be available for the 2020-21 NGER reporting cycle,” the regulator said in an email, seen by RenewEconomy.
“Eligible corporations will be able to opt-in to show how their emissions and electricity consumption is covered by the surrender of eligible units.”
It is understood that the Clean Energy Regulator will soon release a consultation paper and draft guidelines for consultation, with further details about dates and opportunities for stakeholders to provide input to be announced soon.
