Carbon Credit Plan Review rejects criticisms as flawed, and recommends changes to improve transparency

An independent review of the government’s carbon credit scheme rejected suggestions that it was fundamentally flawed, but made a series of recommendations to improve its transparency and integrity.

The scheme works by awarding a carbon credit, officially called the Australian Carbon Credit Unit (ACCU) for every tonne of greenhouse gases avoided or stored by registered projects.

These credits are bought by the government and go towards achieving emissions reduction targets, but a growing number are being sold on a private market to companies that want to offset their own emissions.

In the past year, a number of criticisms have been leveled at the scheme, including by former industry insiders who claim it has become a “rat” and some industry players who have argued that the rules have not incentivized any further emissions cuts.

The review committee, chaired by former chief scientist Ian Chubb, noted that the safety of the system was in question.

“It has been argued that the level of mitigation has been overstated and therefore the ACCUs are not what they should be and therefore the policy is not effective,” the report said.

The authority does not share this view.

“Despite the criticisms presented, the panel concluded that the ACCU scheme was fundamentally well designed when it was presented.”

Chris Bowen in a blue suit and tie mid-sentence, gesturing with his right hand in front of a blue curtain
Chris Bowen says the government has accepted all the recommendations in principle.(ABC News: Ed Reading)

The report argues that one reason for the conflict is due to a lack of transparency around the system’s data and crediting decisions.

It recommended that “the default should be for data to be released to the public, including carbon estimate regions” and that the government should consider creating a national platform to share this information.

“More transparent data and information sharing arrangements will enable communities and stakeholders in the carbon market to more effectively assess, understand and manage potential project impacts and opportunities,” she said.

Climate Change Minister Chris Bowen welcomed the report and said the government had accepted all its recommendations in principle.

“This committee did not try to please everyone,” he said.

“There will be some people who say this committee has gone too far, and there will be some people who say it has not gone far enough. That is understandable.

“But it is a fundamental work. It is inspired by the best science and the best evidence.”

Landfill gas changes

In addition to recommendations for improving transparency and, as a result, fairness in the scheme, the report also made more specific recommendations on which different carbon reduction technologies would qualify for credits.

One is for companies that convert gas from landfill garbage, methane, into a source of electricity.

Right now, companies are given credits based on how much methane they take out of the atmosphere above their “baseline,” which is usually 30 percent.

But some industry hitters have argued publicly that the current system rewards companies for taking actions they would have done anyway and that less credit should be given.

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