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The Minister for Climate Change and Energy, the Hon Chris Bowen MP, has formally requested the Climate Change Authority provide advice to inform the first Annual Climate Change Statement to Parliament, as set out in the Climate Change Act 2022 (the Act).

The Act requires that the Minister deliver an Annual Climate Change Statement to Parliament, following the Climate Change Authority providing advice relating to that Statement.

The Authority’s first Annual Statement Advice will focus on:

• key strategic considerations for the first Annual Statement
• the framework the Authority will employ to assess, in detail, Australia’s progress on climate targets and policy for future annual statement advice
• establishing some baselines for future assessments.

This first Annual Statement Advice draws on consultation, analysis and insights from the Authority’s recent reports. For the next and subsequent Annual Statement Advice, the Authority will undertake public consultation, as required under the Act.

The Authority expects to submit its first Annual Statement Advice to the Minister in November 2022.

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Sequestration – meaning the capture, removal and storage of carbon – has played a role in reducing Australia’s net emissions and will play an even greater role in the journey towards net zero. For Australia to achieve its future targets, sequestration will need to scale up. Fortunately, Australia is endowed with a number of comparative advantages in sequestration.

According to experts who participated in a Climate Change Authority roundtable, broad consultation will be critical to community acceptance of the deployment of sequestration activities at the necessary scale. Participants noted the United Nations Intergovernmental Panel on Climate Change’s finding that large-scale removal of atmospheric carbon is needed to stabilise the world’s climate in line with the Paris Agreement goals.

Experts discussed the need to build understanding of the enabling and limiting factors for each approach to sequestration and what their feasible volumes of sequestration are. Doing so will enable Australia to strategically plan a dynamic portfolio of sequestration activities, with scaling and implementation targets that reinforce their benefits while managing risks and trade-offs.

The roundtable was held on 21 September with a small group of technical and industry experts, including from universities, industry organisations and government agencies. It was a solutions-based discussion of ideas to scale-up carbon sequestration in Australia, with a particular focus on the role of governments. These ideas will inform the Authority’s forthcoming Insights paper on Australia’s carbon sequestration potential, due for completion in the first quarter of 2023.

Key observations from the roundtable included:

• Reducing emissions at their sources must remain the priority of climate policy.

• Australia will need to both reduce emissions at their sources and permanently remove emissions from the atmosphere in order to achieve its national emissions reduction targets.

• Global demand for sequestration is growing, in particular from removals. Understanding national sequestration potential will inform the role Australia can play in supporting global efforts.

• The need to scale-up sequestration is urgent.

• Investment into research, development and demonstration must increase to enable deployment of sequestration activities at the necessary scale and pace.

• Australia’s comparative advantages include significant geological storage capacity, vast areas of non-arable land and abundant renewable energy potential.

• Nature-based sequestration activities bring co-benefits (e.g. for biodiversity) but are vulnerable to natural disturbances, with risks of reversal likely to increase under climate change.

• Community consultation is important to build understanding, and to ensure acceptance and support of sequestration activities. In particular, consultation with Indigenous Australians needs to improve.

• Project developers and decision makers should take account of potential non-carbon benefits for, and adverse impacts on the environment, communities and the economy. For example, while many nature-based approaches can produce significant co-benefits (e.g. ecosystem restoration), poor management of trade-offs can produce negative impacts (e.g. water scarcity and reduced food production).

• Opportunities exist for better regulatory alignment among jurisdictions where sequestration activities cross borders. For example, offshore geo-sequestration can cross Commonwealth and state marine boundaries.

• Decision makers have a role in ensuring the benefits of sequestration activities are shared equitably, including with Indigenous Australians and regional communities.

• The language of carbon sequestration is yet to settle. An agreed set of terms would help address misunderstandings and inconsistencies.

The roundtable forms part of the Authority’s self-initiated Carbon Sequestration Potential research project, to be completed in three phases:

The Authority has partnered with the Clean Energy Regulator to commission the CSIRO to prepare a technical report on Australia’s sequestration potential and lead a series of expert workshops on selected sequestration technologies (due for completion in late 2022).

The Authority intends to publish an Insights policy paper in the first quarter of 2023 setting out its analysis and policy actions on how Australia can achieve its carbon sequestration potential.

Date: Thursday, 13 October 2022

The Authority hosted an online public webinar on the Review of International Offsets on 7 September 2022. The event featured a presentation of its recommendations on the review and a panel discussion with representatives from the Department of Climate Change, Energy, the Environment and Water working on the Indo-Pacific Carbon Offsets Scheme and Climate Active program to discuss the findings of review.

The webinar is available for viewing by following this(Opens in a new tab/window) link.

The Climate Change Authority today welcomes three new members. 

Professor Lesley Hughes, Dr Virginia Marshall, and Ms Sam Mostyn AO join the current membership of the Authority which includes Chair, Mr Grant King and Australia’s Chief Scientist, Dr Cathy Foley AO PSM.

The Authority now has a full complement of members as provided for under the Climate Change Authority Act 2011.

Chair of the Climate Change Authority, Mr Grant King said:

“I warmly welcome Lesley, Virginia and Sam as members of the Authority. Their combined skills and experience will strengthen the capability of the Authority and enable us to meet the expanded responsibilities we have under the new Climate Change Act.

“The Authority will draw upon the diversity and expertise of its members and staff and, working together with businesses, organisations and communities right across the economy, provide advice to accelerate emissions reductions and enhance Australia’s prosperity and resilience as the climate changes and the world transitions to net zero emissions. The Authority’s focus will be on:

• Providing advice to the Minister for Climate Change and Energy for his first annual climate change statement to the Parliament;

• Commencing work to advise on Australia’s next Nationally Determined Contribution, including a nation-wide conversation with businesses, industry organisations, academia, non-government organisations, youth groups, community leaders and so forth;

• Undertaking statutory reviews of the Emissions Reduction Fund and the National Greenhouse and Energy Reporting Scheme, including the Safeguard Mechanism; and

• Continuing self-initiated research on Australia’s carbon sequestration potential and industry transition planning.

“On behalf of the Authority, I thank the Minister for Climate Change and Energy for his strong and collaborative engagement with, and support of, the work of the Authority“.

The Minister’s statement announcing the appointments can be found here(Opens in a new tab/window).

About the Climate Change Authority

The Authority provides independent, expert advice on climate change policy and plays an important role in the governance of Australia's mitigation policies, undertaking reviews and making recommendations. The Authority has recently been given additional powers to provide independent advice to Government on Australia’s progress towards net zero emissions.

A full list of the Authority’s members can be found here.

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Australia’s carbon sequestration potential is the focus of the Climate Change Authority’s latest self-initiated research project.

Achieving the Paris Agreement goal to limit global warming to well below 2°C requires more than deep cuts to global greenhouse gas emissions. Removing emissions from our atmosphere is critical to complement the sharp reductions needed, and to avoid the worst impacts of a warmer world.

The latest UN Intergovernmental Panel on Climate Change (IPCC) report(Opens in a new tab/window) states that removing emissions from the atmosphere and from hard-to-decarbonise processes “is unavoidable”.

It concludes that, globally, up to 4.1 gigatonnes (Gt) of carbon dioxide (CO2) would have to be removed every year by 2030, and up to 6.4 Gt a year by 2050, to meet the Paris Agreement goal.

For this project, carbon sequestration is defined as the storage of carbon in geological, biological, mineral and ocean reservoirs, which was captured by either:

• removing CO2 from the atmosphere, referred to as carbon dioxide removal (CDR), often referred to as negative emissions technologies (NETs); or
• separating CO2 at point of origin and storing it to prevent it entering the atmosphere, commonly known as carbon capture and storage (CCS).

This research project follows on from the Authority’s 2021 Insights Paper Paris Plus: From cost to competitive advantage. That paper found we need a better understanding of Australia’s biological and geological sequestration potential to ensure we can set increasingly ambitious emissions reduction goals backed by rigorous evidence.

The Authority has commissioned CSIRO to undertake a technical report on storage capacities, removal rates and Australia’s comparative advantages in sequestration to support this research project.

The Authority intends to publish an Insights Paper on carbon sequestration in October 2022. This project will help inform the Authority’s advice to government on Australia’s 2035 emissions reduction target.

Questions on the project can be directed to the Secretariat at: enquiries@climatechangeauthority.gov.au

The Authority has outlined its strategy for delivering on an expanded role with the publication today of its Corporate Plan 2022-23. The plan outlines the Authority’s activities for the next four years.

Corporate Plan 2022-23 (PDF; Word).

In his opening statement, the Chair of the Authority Mr Grant King noted that this is a landmark year for the Authority – having celebrated the Authority’s 10th anniversary and now scaling up in response to the Government restoring the Authority’s role in advising on Australia’s emissions reductions targets and climate change policies. 

The Authority’s Chief Executive Officer, Mr Brad Archer, reflected on the Authority’s achievements this year, including the recent release of the Review of International Offsets, and looked ahead to the next twelve months during which the Authority will:  

• provide advice to the Minister for Climate Change and Energy for the first annual statement to the Parliament on climate change; 
• commence work on its advice for Australia’s next Nationally Determined Contribution;
• undertake statutory reviews on the Emissions Reduction Fund, National Greenhouse and Energy Reporting Scheme and the Safeguard Mechanism; and 
• continue self-initiated research on Australia’s carbon sequestration potential and industry transition planning. 

 “The Authority plans to expand its in-house expertise in both depth and breadth to deliver on our expanded mandate. The Authority will also deepen its engagement with communities and business in Australia, including First Nations peoples,” Mr Archer said. 

“In all its work, the Authority seeks to embody its principles and values of independence; broad and meaningful outreach and engagement; excellence in research and analysis; transparency; and good governance and accountability.” 

The Climate Change Authority invites you to register to attend an online public webinar at 12.30pm – 1.30pm on 7 September 2022 to hear about the Authority’s Review of International Offsets.

The Authority’s review was released on 11 August and is available on our website.

The review provides the Authority’s advice on the use of international carbon offsets, particularly for the Australian Government’s Climate Active program and Indo-Pacific Carbon Offsets Scheme, in the context of the Paris Agreement.

The secretariat of the Authority will present the recommendations of the report followed by a question and answer discussion with CEO Brad Archer, General Manager Eliza Murray and representatives from the Department of Climate Change, Energy, the Environment and Water working on the Indo-Pacific Carbon Offsets Scheme and Climate Active program. 

If you would like to attend please register here(Opens in a new tab/window). If you have any issues registering, any questions about the event or would like to provide a question for the discussion, please contact enquiries@climatechangeauthority.gov.au.

11 August 2022: The Climate Change Authority’s Review of International Offsets finds the international carbon market is still evolving in response to the Paris Agreement and calls for publication of a National Carbon Market Strategy that makes the most of this opportunity for Australia to accelerate ambition on emissions reduction.

The review finds that while carbon is priced and traded in Australia, the market is fragmented, inefficient and complicated.

Parts of the market that contribute to meeting Australia’s emissions reduction target, such as the Safeguard Mechanism, are isolated from the voluntary market used by companies and other organisations. And the voluntary market is largely remote from the high-quality, transparent emissions measurement systems that countries use in their national emissions inventories.

“It makes sense – and it is in Australia’s national interest – to play a leading role in the development of a liquid, high integrity and effective global carbon market,” said Climate Change Authority CEO Brad Archer.

“Bringing voluntary and compliance carbon markets together could help accelerate global decarbonisation and enhance the integrity of carbon offsets.”

The Authority is recommending the Government publish a National Carbon Market Strategy, including to:

• make Australia’s carbon price more visible, understandable, and certain, helping to embed decarbonisation in everyday decision-making;
• uphold the integrity of offsets – in both the ways they are generated and the ways they are used – to build confidence and trust in Australia’s approach; and
• clarify the role of domestic and international units in the mix of voluntary action and compliance mechanisms to help smooth and accelerate Australia’s decarbonisation.

In responding to the terms of reference, the Authority puts forward 18 recommendations for the Government to consider, relating to:

• the evolving rules for international carbon trading being put in place to achieve the goals set out in the Paris Agreement, the implications for compliance and voluntary action contributing to national emissions targets, and the opportunities presented to enhance the integrity of carbon offsets;
• setting out the Government’s strategy for the role of carbon markets in contributing to achieving Australia’s Nationally Determined Contribution (NDC) under the Paris Agreement; and
• the eligibility criteria for units accepted under Climate Active and the Indo-Pacific Carbon Offsets Scheme (IPCOS), including introducing a phase out of older units and reviewing others again by 2025.

“While achieving deep emissions reductions is critical, carbon offsets are an important and complementary part of the approach to reaching net zero emissions and beyond”, Mr Archer said.

“High integrity offsets allow nations and companies to set more ambitious targets and accelerate decarbonisation beyond what‘s achievable from direct emissions reductions.

“This is particularly the case for very hard-to-abate emissions. Offsets can help smooth the transition away from emissions intensive activities, and put the necessary ‘net’ in net zero emissions by 2050.

“Carbon markets also provide a means of channelling public and private finance to support our regional neighbours leapfrog the emissions-intensive economic development trajectories of industrialised nations.

“With Australia adopting a more ambitious 2030 emissions reduction target on the way to net zero emissions by 2050, we can turn our minds to how governments and businesses can collaborate to achieve those goals as soon as possible and ensure Australia’s future prosperity,” Mr Archer said.

“It’s important that offsets have integrity and that they are not double counted, for example. Our review of the criteria applied to international carbon offsets will provide confidence in the quality and integrity of carbon offsets being used here.”

Background

The Climate Change Authority’s Review of International Offsets responds to a request from the former Government to provide advice – in the context of the Paris Agreement rules – on the criteria that should be applied to international offsets under the Government’s Climate Active carbon neutral certification program, the Indo-Pacific Carbon Offsets Scheme, and for other uses.

Link to the Review of International Offsets report here

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The Climate Change Authority’s latest considerations in its Review of International Offsets are now available in the slide pack below.

The review will advise on the use of international carbon offsets in the context of the Paris Agreement, and in particular their use in Australia’s Climate Active(Opens in a new tab/window) and Indo-Pacific Carbon Offsets Scheme(Opens in a new tab/window).

The review follows agreement at the UN climate conference in Glasgow in 2021 (COP26) on the Article 6 rules for Paris Agreement carbon markets, and the increasing focus globally on implementation of emissions reduction targets.

In conducting this review, the Authority has engaged with stakeholders across governments, industry and advocacy groups while also undertaking its own research.

The Authority released a review consultation paper on 7 March, 2022 and considered the submissions received along with information provided at further consultations with stakeholders.

The Authority intends to submit its Review of International Offsets to the Minister Climate Change and Energy, Chris Bowen and publish it online by 31 July 2022. The Authority had originally indicated publication on 30 June 2022.

Review of International Offsets slides

Consultation

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The Climate Change Authority has today commenced public consultation (Opens in a new tab/window)on its review of the assessment principles for international offsets. The Authority has published a consultation paper (Opens in a new tab/window)and is inviting submissions from interested parties by 4 April 2022.

The Minister for Industry, Energy and Emissions Reduction, the Hon Angus Taylor MP (the Minister), has asked the Climate Change Authority to undertake a review of the principles and criteria to apply to assessing the use of international offsets under Commonwealth programs including Climate Active(Opens in a new tab/window) and Australia’s Indo-Pacific Carbon Offsets Scheme(Opens in a new tab/window) (IPCOS), in the context of the Paris Agreement. The resulting criteria may also have relevance to other policies and programs, and for accounting for Australia’s emission reduction targets.

“A review by the Climate Change Authority on emissions offsets is timely. International carbon markets are evolving rapidly and have the potential to reduce the cost of achieving emission reduction targets. However, their design must ensure they contribute to global decarbonisation efforts.” said CEO Brad Archer.

“The consultation paper released today gives interested parties the opportunity to provide their views on the criteria for accepting offsets for use in Climate Active and IPCOS.

“This review of the arrangements underpinning international offsets is important to ensuring that any offsets used in Australia represent real emissions reductions, make a genuine contribution to the goals of the Paris Agreement, and provide confidence in reported progress to emissions reduction targets by Australian companies,” Mr Archer said.

Responses to the consultation paper will inform the Authority’s final review report, which is due to be delivered to the Minister by 30 June 2022.

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