Chubb’s big challenge is to restore faith in Australia’s tainted carbon markets

Federal Climate Change and Energy Minister Chris Bowen has launched a promised independent review into the ailing Emissions Reduction Fund, appointing a former chief scientist to investigate claims the program lacks integrity environmental.

The Emissions Reduction Fund – and Australia’s fledgling carbon market more broadly – was rocked earlier this year after the programme’s former watchdog chair turned whistleblower claiming that carbon offsets issued under the program lacked integrity and amounted to “environmental fraud”. ”.

The claims were rejected by the Clean Energy Regulator, which administers the program, and the former Morrison government. But on Friday, the new Albanian government commissioned an independent review of the compensation scheme.

“The government wants to ensure that it remains a strong and credible program supported by participants, buyers and the wider community. The review will achieve that goal,” Bowen said in a statement.

The review will be chaired by former chief scientist and former vice-chancellor of the Australian National University, Ian Chubb. In his former role as chief scientist, Chubb served on the first board of the Climate Change Authority.

Chubb will be joined by an as yet unannounced group of four other experts to lead the review.

The genesis for the allocation of ACCUs to carbon offset projects was the Carbon Farming Initiative set up under the Gillard government. It has been transformed into the Abbott government’s flagship emissions reduction policy, and the new Albanian government will build on the program as part of an overhaul of the safeguard mechanism.

Although the objective of the review is theoretically to ensure that the offsets regime can be reoriented by the Albanian government as part of its new package of climate policies, its most important task will be to restore confidence in the fact that the diet is actually environmentally friendly.

Under the terms of reference for the review, the group will consider integrity issues around Australian Carbon Credit Units (ACCUs) issued under the Emissions Reduction Fund, including whether governance and carbon offset methodologies of the system remain fit for purpose.

Bowen specifically tasked the review panel with reviewing recent claims regarding offset methodologies that apply to human-induced regeneration, carbon capture and storage, avoided deforestation, and landscaping projects. burying waste gases.

The review will report to the government with findings and recommendations within six months and before the end of the year.

Labor had signaled its intention to conduct a review of the Emissions Reductions Fund ahead of the election and before former Emissions Reductions Assurance Committee Chairman Andrew Macintosh claimed that many of the offsets emitted under the program were not supported by real emission reductions.

Bowen said the review would take into account the integrity issues raised by Macintosh, while ensuring the system can be used by the new government to meet its new emissions reduction targets.

“The review panel will address these concerns by examining the governance arrangements and legislative requirements, the integrity of the main methods used and the broader parameters of the regime that affect the integrity of ACCUs.

“Carbon markets have enormous potential to support Australia’s ambition to cut emissions by 43% below 2005 levels by 2030, achieve net zero emissions by 2050 and drive the economy.”

“A strong carbon credit system will encourage more organizations to take action to reduce their emissions, help Australia meet its emissions reduction targets and better support our regional economies,” Bowen added.

The review has been well received by critics and supporters of the Emissions Reduction Fund.

The Australia Institute, which has led calls for an overhaul of the scheme, welcomed the broad scope of the review, including a review of the scheme’s governance arrangements.

“Integrity must be at the heart of Australia’s climate policies. The review is welcome and essential to ensure that any climate goals legislated by the Australian Parliament are credibly achieved,” said Australia Institute Climate and Energy Program Director Richie Merzian.

“The appointment of respected former chief scientist Ian Chubb AO as chair of the review demonstrates a clear commitment by the federal government to investigate the serious integrity issues that are eroding confidence in the Australian carbon market.”

“It is important to note that this review will extend to the governance arrangements of the Emissions Reduction Fund (ERF). This should include the many roles of the clean energy regulator, who co-designs the methods, regulates the market and purchases most carbon credits and the associated emission reduction insurance committee.

The Carbon Market Institute, whose members include the bulk of Emissions Reduction Fund participants and carbon traders, also welcomed the review.

“We are now on the verge of moving from a taxpayer-funded credit system to one that will be primarily driven by the private sector, as it responds to the demand for more stringent compliance obligations, but also covenants volunteers in the transition to net-zero emissions,” said Carbon Market Institute CEO John Connor.

“However, for the market to fulfill its objective of driving real and additional emission reductions and removals, and directing finance to where it is most needed, the priority must be to ensure that our carbon credits and their governance are fit for purpose.”

“As such, we support the upcoming review as a key opportunity to strengthen and improve the integrity and investability of the carbon credit framework which can also be leveraged for important environmental co-benefits. , indigenous and social supporting sustainable land management and biodiversity conservation. “, added Connor.

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