Monday, March 23, 2009

The CPRS kills carbon neutrality

Further to the good work of Richard Dennis from The Australia Institute which has highlighted that the proposed Carbon Pollution Reduction Scheme is in fact a Reallocation scheme, it has now emerged that the CPRS is also greatly impacting local government across Australia in their efforts to go carbon neutral.

Local government has in fact led the way on climate change, with several already announcing plans and commitments to go carbon neutral, and many others seriously considering doing so too.

Unfortunately, the CPRS has created doubts and confusion about what carbon neutrality means at Local Government level.

Greenhouse Friendly abatement credits obtained to date (voluntary scheme) will be not be valid under the CPRS.

Under the CPRS, entities offsetting and or reducing emissions will no longer be able to claim carbon neutrality as their emissions are reallocated and the link between entity emission reductions and aggregate emissions will be broken.

For example, from: Carbon Pollution Reduction Scheme — Implications for Greenhouse Friendly™

Introduction of the Carbon Pollution Reduction Scheme (the Scheme) has implications for Greenhouse Friendly™. The Scheme will impact on the types of abatement that can be provided and the issue of carbon neutrality.

The Scheme will have broad sectoral coverage, which means that from 2010, there will be less scope to pursue offset activities with offsets limited to emissions sources uncovered by the Scheme. In the lead up to the Scheme, companies could be taking action to reduce their emissions based on the expectation of a future carbon price. Therefore it will become increasingly difficult to demonstrate the additionality of abatement projects. Further, Greenhouse Friendly™ abatement credits will not be fungible into the Scheme.
National Carbon Offset Standard

The Government has made a commitment to develop a national standard for carbon offsets to provide national consistency and give consumers confidence in the voluntary carbon offset market. The offset standard will provide guidance on what constitutes a genuine, additional voluntary offset credit, as well as setting requirements for the verification and retirement of such credits, and standards for calculating the emissions of a product or service.

The Department of Climate Change released a discussion paper on the National Carbon Offset Standard on 19 December 2008 for public consultation. The Department is currently conducting public consultations.

Please note that the Greenhouse Friendly™ Guidelines and other publications are yet to be revised in accordance with this announcement.

You can download the discussion paper [here] (PDF)

From this discussion paper:

2.2 Implications for carbon neutrality
From a consumer’s point of view, the environmental credibility of carbon neutrality comes from the fact that offsetting means an entity’s activities do not increase aggregate emissions and therefore help to mitigate climate change. As described above, the effect of a cap on emissions from covered sources is to break the link between individual voluntary action and aggregate emissions.

The Municipal Association of Victoria (representing local governments) has already made this submission concerning the discussion paper [link] (PDF)

The MAV has also provided this briefing to their members [link] (PDF)

So in addition to the CPRS (if legislated) doing nothing to reduce Australia's greenhouse gas emissions by 2020, it will effectively prevent local and state governments reducing their emissions too.

External links

1 comment:

simon said...

Yesterday, 23rd March I attended a Carbon Accounting seminar at the Sofitel in Melbourne. About 90 corporate accountants were addressed by Anthea Harris. She was charming and articulate but skipped over the sticking points.

When asked to quantify the emissions that would be expected to be saved, she referred the seminar to the Dept. Climate Change website.

It was spin and more spin. She left immediately after her presentation and did not stay to hear the deep concerns expressed by other speakers.

Having been at all kinds of Climate Action gatherings it was refreshing to see a group accountants expressing the same kinds of views as the environmental groups.