A review of Australia’s controversial carbon credit system recommended significant changes to how it is managed, but rejected claims that the scheme lacks integrity and does not deliver real reductions in greenhouse gas emissions.
The review panel, led by former national chief scientist Professor Ian Chubb, found that the government agency that regulates clean energy should be stripped of some of its roles in managing and overseeing the system in order to “promote confidence and transparency”.
He also recommended abolishing the Commission on Emissions Reduction Guarantee, the integrity body responsible for approving methods used to create carbon credits. The commission said it should be replaced by a new body – it proposed an integrated carbon reduction commission – that would increase accountability and independence.
But the The report was released on Monday He rejected claims detailed by a team of academics led by Professor Andrew MacIntosh, former chair of the Commission on Ensuring Emissions Reductions, that failures in the system meant approval of more than 70% carbon credits. They may not represent new or real emissions reductions.
The committee said it did not share the view that the safety of the scheme was questionable, that the level of emissions reductions had been overstated, or that the carbon credits policy had not been effective.
Carbon credits are issued to projects that use government-approved methods to store or avoid greenhouse gas emissions. One carbon credit is supposed to represent one ton of carbon dioxide. The credits can then be sold to the government or polluting companies, which use them to offset their emissions on site.
climate change minister, Chris BowenHe promised to review the carbon credit system as part of Labor policy before the 2022 election.
Instead of reducing their own pollution, they can choose to buy carbon credits that are meant to represent a reduction in emissions elsewhere.
Each carbon credit represents one tonne of carbon dioxide that has either been stopped from going in the atmosphere, or sucked out of it.
Methods approved to generate carbon credits in Australia include regenerating native forest that has been cleared, protecting a forest that would otherwise have been cleared (known as “avoided deforestation”) and capturing and using emissions that leak from landfill sites to generate electricity.
Credits are bought by the government through the $4.5bn taxpayer-funded emissions reduction scheme or by polluters on the private market.
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Question and Answer
What are carbon credits?
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Carbon credits are used by the government and polluting companies as an alternative to reducing carbon dioxide emissions.
Instead of reducing their own pollution, they can choose to buy carbon credits that are supposed to represent a reduction in emissions elsewhere.
Each carbon credit represents one ton of carbon dioxide that has been either prevented from going into the atmosphere or absorbed from it.
Approved methods for generating carbon credits in Australia include regenerating cleared native forests, protecting a forest that would otherwise have been cleared (known as “avoiding deforestation”) and capturing and using emissions that escape from landfill sites to generate electricity.
The credits are bought by the government through a taxpayer-funded $4.5 billion emissions reduction plan or by polluters on the private market.
What the review found
At a press conference with Bowen on Monday, Chubb said the scheme “has not been broken as has been suggested.” He said it was a “man-designed, human-executed process that will be a little frayed at the edges”, but that the system was “fundamentally sound” with safeguards.
Chubb’s review suggested some changes to the methods used to create carbon credits that have been criticized—notably avoiding deforestation, which rewards landowners for protecting forests they would otherwise have bulldozed. She said the current method should no longer be used because the length of time since land clearing permits for western NSW were issued means it would be difficult to prove that landowners still really intended to kill trees.
The committee found little flaw in the most popular method used to create credits, which rewards the re-growth of indigenous forests in remote cleared areas. Landowners using this method, known as “human-induced renewal,” have signed contracts with the federal government valued at nearly $1.5 billion.
Some human-caused regeneration projects have been awarded carbon credits for managed regeneration of forests when it didn’t happen, McIntosh and his colleagues said, and others for regeneration that would have happened anyway because it was mostly only caused by rainfall. They estimated that 165 projects had received 24.5 million carbon credits, despite the combined area of forest and sparse woody vegetation backing back more than 60,000 hectares.
Chubb’s review did not directly address this claim. The method was largely sound, the commission said, but steps must be taken to ensure all projects are in line with what was intended – for project areas to become native forests and permanently store carbon dioxide. It also suggested that the regulator publish the results of project evaluations every five years.
The review was not critical of the current governance model, but recommended removing some powers from the clean energy regulator to improve confidence in the scheme. It proposed that the regulator retain responsibility for compliance and enforcement while creating a new independent body — the proposed commission — to oversee approval and integrity, and give an existing government body a separate responsibility for purchasing carbon credits using taxpayer money.
The committee suggested that the government make more data on carbon credit projects available to the public and consider canceling a percentage of all credits to improve confidence that the reductions rewarded were “appropriately conservative”.
reaction to the review
The team of academics said alleged problems with the plan were “frustrating and confusing” with the review as the panel recommended sweeping changes in management while also arguing that the carbon credit system “appears to be working well”. He said, “It doesn’t make sense.”
He said his team’s findings have received support from some of the country’s most prestigious scientific organizations, including the Australian Academy of Sciences, the Wentworth Group of Concerned Scientists and CSIRO. He said the review appeared to ignore a report it requested from the Academy of Sciences that found significant problems with some of the methods.
Bowen said the government has accepted in principle the 16 recommendations in the review, and will implement some changes immediately. He said the panel “not only got the balance right, but they applied a rigorous, all-evidence-based process.”
Carbon credits are expected to be central to the government’s promise to reduce industrial emissions with protection mechanism, a policy introduced by the coalition that has so far failed to stem the increase in pollution. On Tuesday, more details are expected on how the action plans to change the protection mechanism.
The extent to which credits should be made available to help achieve government and corporate goals to reduce greenhouse gas emissions is a matter of dispute. United Nations Group established for Greenwash suppression of net zero pledges Last year he argued that commitments should prioritize reducing absolute emissions by 2030 in line with limiting global warming to 1.5°C, with offsets only being used for further cuts above and beyond that.
The Carbon Market Institute, which represents companies that generate credit and companies that buy it, said the review supported a “sound” framework while identifying improvements that could boost confidence in the scheme.
We hope that we can overcome the divisions of recent months and years and move forward urgently to deliver a policy framework that is not only credible, sustainable and investable, but also capable of achieving emissions reductions of at least 50% by 2030 and negative emissions by 2050, said the institute’s CEO, John Connor.
Conservation Australia welcomed Chubb’s recommendations but said it had “serious concerns” about the failure to address current problems. It called for an on-the-ground assessment of credits already issued using the avoided deforestation method to test whether they were ‘Basically undesirable’.