This has resulted in attempts to use carbon offsets in inappropriate situations. However, at a high level, the issues have arisen because the scheme has focused on maximising the number of carbon credits issued, to put downward pressure on carbon credit prices. In forthcoming articles, we will detail the problems with these methods. large landfills operating electricity generators that would have operated anyway.growing forests in places that will never sustain them permanently.protecting forests that were never going to be cleared.Our analysis found credits have been issued for emissions reductions that were not real or additional, such as: Part of the problem is that calculating carbon credits is extremely difficult. landfill gas: projects supposed to capture and destroy methane emitted from solid waste landfills using a flare or electricity generator.avoided deforestation: projects supposed to protect native forests in western New South Wales that would otherwise be cleared.human-induced regeneration: projects supposed to regenerate native forests through changes in land management practices, particularly reduced grazing by livestock and feral animals.Our initial criticism focuses on the scheme’s most popular methods, which account for about 75 per cent of carbon credits issued: Concerns have been raised about these methods for years. Under the scheme, a range of methods lay out the rules for emissions abatement activities. Each credit is supposed to represent one tonne of carbon abatement.īuyers include the federal government (using taxpayer funds) and private entities that are required to, or voluntarily choose to, offset their emissions. These credits can be sold on the carbon market to entities that want to offset their emissions. Under the fund, projects that reduce emissions are rewarded with carbon credits. Read more: A simple way to cut carbon emissions: don't let polluters hide Three big problems The full statement is included at the end of this article. The regulator pointed to its “comprehensive response” to the issues raised and also rejected allegations of fraud. The Conversation contacted the Clean Energy Regulator regarding the authors’ claims. Recently, Bowen said our concerns were “substantial and real” and he took them “very seriously”. We have expressed serious concerns with that review process, which we believe was not transparent and showed a fundamental lack of understanding of the issues. The Clean Energy Regulator (which administers the fund) and the current ERAC reviewed our claims and, earlier this month, dismissed them. In our view, a process that systematically pays for a service that’s not actually provided is fraudulent. Our decision to call the scheme a “fraud” was deliberate and considered. Our analysis suggests up to 80 per cent of credits issued under three of the fund’s most popular emissions reduction methods do not represent genuine emissions cuts that wouldn’t have happened otherwise. The lead author of this article, Andrew Macintosh, is the former chair of the Emissions Reduction Assurance Committee (ERAC), the government-appointed watchdog that oversees the Emissions Reduction Fund’s methods. We are experts in environmental law, markets and policy. Carbon credits are essentially permits that represent the right to emit a set amount of carbon dioxide or other greenhouse gases. In this and subsequent articles, we seek to simplify the issues for the Australian public, the new parliament and whoever is appointed to review the Emissions Reduction Fund. For the past decade, it has been the centrepiece of Australia’s climate policy. ![]() ![]() ![]() It provides carbon credits to projects that reduce greenhouse gas emissions. The fund was established by the Abbott government in 2014 and is now worth A$4.5 billion. ![]() Labor has promised a 43 per cent cut in Australia’s emissions by 2030, and a high-integrity carbon credit market is vital to reaching this goal. We welcome the federal government’s review. In March, we exposed serious integrity issues with the scheme, labelling it a fraud on taxpayers and the environment. A probe into Australia's carbon credit scheme must address evidence of systemic fraud, write ANU's Andrew Macintosh and Don Butler, and UNSW Sydney's Megan EvansĬlimate Change Minister Chris Bowen has announced a much-anticipated review of Australia’s carbon credit scheme, known as the Emissions Reduction Fund.
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