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The carbon credits review focused on transparency, but has it missed the mark?

9 January 2023 at 4:51 pm
Danielle Kutchel
If carbon credit units are to play a role in Australia’s net zero journey, the scheme must be more transparent, a review concludes. 

Danielle Kutchel | 9 January 2023 at 4:51 pm


The carbon credits review focused on transparency, but has it missed the mark?
9 January 2023 at 4:51 pm

If carbon credit units are to play a role in Australia’s net zero journey, the scheme must be more transparent, a review concludes. 

An independent review of Australia’s carbon credits scheme casts doubt on claims of widespread fraud in the scheme, instead recommending an overhaul focused on more transparency.

The Independent Review of Australian Carbon Credit Units, led by Professor Ian Chubb, handed down its final report in December after being tasked with reviewing the Australian Carbon Credit Unit (ACCU) scheme by the new federal government earlier in 2022.

The review panel found that the ACCU scheme “has an important role to play” in Australia’s journey to net zero by 2050.

It did not confirm recent claims the scheme is ineffective, instead concluding “the scheme was fundamentally well-designed when introduced … [but] can be improved” with measures to promote transparency and integrity.

The report makes 16 recommendations to “improve the scheme: to clarify intention where necessary; to clearly identify (and separate) the key roles of integrity assurance, regulation and administration; to remove unnecessary restrictions on data sharing; to enable free prior and informed consent; and to improve information and incentives, including in relation to non-carbon benefits and attributes”. 

The panel also cautions that action to improve the scheme should be resourced appropriately to ensure that ACCUs can play a role in Australia’s climate mitigation policies.

“Given… the essential need for their integrity to be unarguable, all the links in the chain need to be able to do the job required of them,” the report concluded, adding “there is no practical or cheap alternative”.

Recommendations to improve transparency

Among its 16 recommendations, the review panel suggests keeping the roles of scheme assurer, scheme regulator and related policy development separate to “enhance confidence and transparency”.

It also recommends the Emissions Reduction Assurance Committee be re-established as the Carbon Abatement Integrity Committee, with “major responsibility” for integrity.

The review panel found that current restrictions on data sharing around the ACCU scheme “go further than required to protect privacy and commercial-in-confidence information, and the blanket nature of these restrictions is undermining transparency, trust and confidence in the scheme”.

To address this, it recommends changes to the scheme’s governing legislation, “ to maximise transparency, data access and data sharing”.

“The default should be that data be made public, including carbon estimation areas,” the report recommends.

The human-induced regeneration method of storing carbon has come under fire, but the review panel found that while it could use some improvement, it is nevertheless “sound”.

The report also recommends that rural and remote communities, including First Nations peoples, should be supported by the federal government to participate in the ACCU scheme.

Ignoring “the elephant in the room”

In a statement, the Climate Council said it was vital for Australia to “genuinely cut emissions”.

It questioned the review panel’s focus on governance rather than use of ACCUs.

In focusing on the governance, creation methods and reporting arrangements for ACCUs, the Chubb Review may have met its brief but ignores the elephant in the room: too many major emitters are buying ACCUs so that they can continue to pollute as usual,” the statement read.

“Carbon offsets are supposed to be used as a last resort, and only for the small share of emissions that cannot be avoided through process, technology and other operational changes.  

Instead, paying for ACCUs has become the first and only thing many businesses are doing about their harmful emissions. As the Australian Government prepares to strengthen the law that regulates emissions from Australia’s biggest industrial polluters, the Safeguard Mechanism, this must change.”

Climate Council Head of Advocacy Dr Jennifer Rayner called for reform to the Safeguard Mechanism, including limits to the amount of emissions that can be offset to ensure that major industrial polluters genuinely reduce emissions, setting baselines for businesses to lead to “substantial declines in emissions” by 2030, and “no special deals” for fossil fuel facilities like coal and gas plants.

“Big polluters shouldn’t be able to keep polluting as usual by offsetting much or all of their emissions under the Safeguard Mechanism. This will simply result in more pollution as usual and worsening climate damage. For the Safeguard Mechanism to work, and drive down emissions, there must be tight restrictions on the use of offsets,” Rayner said.

Dr Richard Denniss, executive director of the Australia Institute, said the review “is silent about the most important issues facing our Parliament and our climate, namely how many dodgy carbon credits are still circulating in the Australian economy and how can we recognise them?”

He said the review would “add to the confusion about the role, integrity and future of carbon credits in Australian climate policy”.

“Carbon credits will be central to the Albanese Government’s Safeguard Mechanism, which it hopes to legislate in the coming months. Without so much as an estimate of how many dodgy carbon credits are currently circulating in the economy from this review, it seems the safest way to proceed is to prevent the use of Australian Carbon Credit Units (ACCUs) in the government’s new scheme,” Denniss said.

Danielle Kutchel  |  @ProBonoNews

Danielle is a journalist specialising in disability and CALD issues, and social justice reporting. Reach her on or on Twitter @D_Kutchel.


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