Climate Change Authority

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2 degree goal

A global goal to limit global average warming to less than 2 degrees above pre-industrial levels.

accounting framework

The rules that specify how to estimate greenhouse gas emissions and what emissions count towards an emissions reduction target.

agriculture emissions

Emissions resulting from livestock digestive processes (enteric fermentation), manure management, nitrous oxide emissions from cropping and pastureland soils, prescribed burning of savannas and burning of agricultural residues.

Annex I countries/Parties

Industrialised countries and economies in transition listed in Annex I to the United Nations Framework Convention on Climate Change.

Assessment Report

Comprehensive assessment of the state of climate change science published by the Intergovernmental Panel on Climate Change.

Australian carbon unit

An emissions unit established by the Clean Energy Act 2011 (Cth), issued for the purposes of the carbon pricing mechanism. The total number of units issued each year does not exceed the cap.

business-as-usual emissions trend

Emissions that would occur without any policy intervention (or additional policy intervention).


The year-by-year limit on emissions from sources covered by the carbon pricing mechanism.

carbon capture and storage

Technologies that capture carbon dioxide emissions from energy production or industrial processes, and inject it below land or the sea into underground geological formations.

carbon dioxide equivalent

A measure that quantifies different greenhouse gases in terms of the amount of carbon dioxide that would deliver the same global warming.

Carbon Farming Initiative

An Australian emissions offset scheme that credits emissions reductions from certain sources, such as forestry and agriculture, that are not covered by the carbon pricing mechanism.

carbon price

The price of an emissions unit.

carbon pricing mechanism

An emissions trading scheme that puts a price on Australia’s greenhouse gas emissions. It was introduced under the Clean Energy Act and applies to Australia’s biggest emitters (called ‘liable entities’).


The accounting framework under the Kyoto Protocol that allows a country performing better than its Kyoto target to ‘carry over’ the extra emission units to the next commitment period.

Certified Emission Reduction

An emissions unit issued under the Clean Development Mechanism, for emissions-reduction projects in developing countries. These CERs can be traded and sold, and used by industrialised countries to help meet their emissions reduction targets under the Kyoto Protocol.

cumulative average growth rate

A constant rate of growth that delivers equivalent change over a period.

climate system

A highly complex system consisting of five major components—the atmosphere, the hydrosphere, the cryosphere, the land surface and the biosphere, and the interactions between them.

commitment period

The timeframe of binding national goals under the Kyoto Protocol. The first commitment period was five years from 2008–2012. The second commitment period is eight years from 2013–2020.

covered emissions

Emissions from sources covered by the carbon pricing mechanism.

Direct Action Plan

The government’s proposed policy to reduce greenhouse gas emissions and establish a clean-up and environment conservation program. A central element of the plan is the Emissions Reduction Fund.


The process of reducing emissions; for example, in an economy or sector.

direct combustion emissions

Emissions released when fuels are combusted for stationary energy purposes, such as generating heat, steam or pressure (excluding electricity generation). These emissions are released by large industrial users, and by small, dispersed residential and commercial consumers.

electricity emissions

Emissions released when fuels, such as coal and natural gas, are combusted to generate electricity.

eligible international emissions unit

An international unit that is accepted for compliance under the carbon pricing mechanism, including Kyoto Protocol-certified reduction units, emissions reduction or removal units, and other units identified by the government under the legislation.

emissions budget

A cumulative emissions allowance over a period of time.

emissions intensity

A measure of the amount of emissions associated with a unit of output; for example, emissions per unit of gross domestic product.

emissions reduction

The act or process of limiting or restricting greenhouse gas emissions.

Emissions Reduction Fund

A $3 billion fund proposed by the government to allocate money through a reverse auction to emissions reduction tenders to projects designed to reduce emissions.

emissions reduction goal

Any emissions reduction objective, such as an emissions reduction target or target range, an emissions budget or an emissions trajectory. Includes a pledge to reduce or limit emissions made under the United Nations Framework Convention on Climate Change.  

emissions reduction target

A goal for national emissions in a specific year.

emissions rights

The rights of individuals or countries to emit greenhouse gases.

emissions trading scheme

A market-based approach to reducing emissions that places a limit on emissions allowed from all sources covered by the scheme. Emissions trading allows entities to trade emissions units with other entities. In general, trading can occur at the domestic, international and intra-company levels.

emissions unit

Represents a unit of one metric tonne of carbon dioxide equivalent.

equivalent carbon price

Part of the carbon pricing arrangements established under the Clean Energy Act. Applies to certain liquid fuels and synthetic greenhouse gases through adjustments to fuel excise arrangements, and to the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 (Cth). The equivalent carbon price paid will be equal to the effective carbon price paid by liable entities under the carbon pricing mechanism.

European Union Allowance

An emissions unit issued in the European Union Emissions Trading System.

fleet-average CO2 emissions standards

A policy requiring vehicle suppliers to meet an efficiency standard (expressed as carbon dioxide emissions), based on the average size or weight of all new vehicles they sell (a fleet-average). This approach allows suppliers flexibility to sell a mix of vehicles that aligns with their commercial strategy and consumer preferences.

fugitive emissions

Greenhouse gases emitted during the extraction, production, processing, storage, transmission and distribution of fossil fuels such as coal, oil and gas.

global emissions budget

The total amount of emissions projected to result in a given rise in global temperature. Budgets are expressed in terms of probabilities to reflect uncertainties about the exact temperature effect of a given amount of emissions. The Authority has adopted a 67 per cent chance of causing warming of less than 2 degrees as its reference for Australia’s goals.

global warming

Used interchangeably with climate change.

global warming potential

An index measuring the radiative forcing of a well-mixed greenhouse gas in the atmosphere, relative to carbon dioxide, in order to compare its equivalent contribution to global warming.

greenhouse gas

Any gas (natural or produced by human activities) that absorbs infrared radiation in the atmosphere. Key greenhouse gases include, carbon dioxide, water vapour, nitrous oxide, methane and ozone.

gross domestic product

A measure of the value of economic production in the economy.

gross national income

An economic measure that reflects gross domestic product, the terms of trade and international income transfers.


The period after 1750.

industrial process emissions

Emissions from industrial processes including metal production, synthetic greenhouse gases, chemical processes, mineral production and other processes. Excludes emissions from combustion for energy purposes.

Intergovernmental Panel on Climate Change

An international scientific body operating under the auspices of the United Nations. Its role is to review, assess and synthesise the latest information on climate change.

land use, land use change and forestry (emissions)

Emissions associated with human-induced changes in land use, such as deforestation, afforestation and forest management.

Kyoto gases

Greenhouse gases covered under the Kyoto Protocol. These are: carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs) and sulphur hexafluoride (SF6). The second commitment period also includes nitrogen trifluoride (NF3).

Kyoto Protocol

An international agreement adopted under the United Nations Framework Convention on Climate Change in 1997. It includes binding national targets for developed countries and flexible mechanisms including the Clean Development Mechanism (CDM).

Kyoto unit

Emissions units eligible for compliance with Kyoto Protocol targets—these include assigned amount units (AAUs), certified emission reduction units (CERs), emission reduction units (ERUs) and removal units.

marginal price of emissions reduction

The cost of reducing emissions by one additional tonne.

Megawatt electric

Electrical power output of a generator in megawatts, as distinct from other power outputs such as heat generated.

national carbon budget

Australia’s cumulative emissions allowance over a period of time, referred to in the Clean Energy Act. This report uses ‘national emissions budget’ to mean the same thing.

National Greenhouse Gas Inventory

An annual time series compilation of Australia’s emissions data, prepared by the Department of Environment in line with UNFCCC guidelines.

net targets

The recommended emissions reduction goals are net of trade. This means that any international emissions reductions Australia buys will count as reductions towards its target—but any emissions reductions sold overseas cannot be counted. Emissions in Australia could be higher than the target if offset by purchases of international emissions reductions.

parts per million

A measure of the concentration of greenhouse gases in the atmosphere. One part per million is equivalent to one cubic centimetre of gas per cubic metre of air.


The period before 1750.

radiative forcing

A measure of the influence that a factor has on the energy balance of the climate system. Positive forcing tends to warm the surface, while negative forcing tends to cool it.

Renewable Energy Target

A Commonwealth Government scheme that places a legal obligation on electricity retailers and large electricity users to buy a certain proportion of their electricity from renewables-based generation.

stationary energy emissions

Emissions from electricity generation and direct combustion.

target conditions

The conditions the Commonwealth Government has specified in relation to its emissions reduction target range for 2020, and reflected in international agreements.

terms of trade

The ratio of the price of a country’s exports, relative to its imports.


An indicative year-by-year emissions pathway to an emissions goal.

trajectory range

A range within which future targets and trajectories may be set.

transport emissions

Emissions from vehicles, combusting or otherwise, converting fuels to move people and freight, reported across four modes—road, rail, domestic aviation and domestic shipping. International aviation and shipping emissions are excluded from Australia’s national inventory.

uncovered emissions

Emissions from sources not covered by the carbon pricing mechanism; includes emissions covered by the equivalent carbon price.

unit shortfall charge

If a liable entity under the carbon pricing mechanism does not surrender a sufficient number of emissions units then they must pay a charge equal to the unit shortfall multiplied by a specified amount greater than one. The charge provides an incentive to surrender sufficient units.

United Nations Framework Convention on Climate Change

An international treaty that commits signatory countries (Parties) to stabilise greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous human-induced interference with the climate system.

voluntary action

The autonomous decision of individuals, companies or governments to reduce greenhouse gas emissions, such as to offset emissions to be carbon-neutral.

waste emissions

Emissions, mainly methane and nitrous oxide, that arise as organic waste decomposes in the absence of oxygen.