|
representatives vote 2023-03-27#3
Edited by
mackay staff
on
2023-03-31 08:12:06
|
Title
Bills — Safeguard Mechanism (Crediting) Amendment Bill 2022; Consideration in Detail- Safeguard Mechanism (Crediting) Amendment Bill 2022 - Consideration in Detail - Agree with the bill as amended
Description
<p class="speaker">Zali Steggall</p><p>by leave—I move amendments (1) to (5) together:</p><p class="italic">(1) Schedule 1, item 1, page 3 (line 14), at the end of subsection 3(2), add:</p><p class="italic">; and (c) aggregate covered emissions from the operation of designated large facilities decline.</p><p class="italic">(2) Schedule 1, item 12, page 5 (before line 5), before subsection 10(4), insert:</p><p class="italic">(3A) A determination under subsection (3) must require:</p><p class="italic">(a) the measurement of methane emissions from oil and gas facilities to comply with the latest standards developed by the Oil and Gas Methane Partnership, as existing from time to time; and</p><p class="italic">(b) direct methane emissions measurement and modelling at both the source and site levels for all fossil fuel facilities on and after the following date:</p><p class="italic">(i) if the facility commences operation on or after 1 July 2023 and Part 3H applies to it—1 July 2024;</p><p class="italic">(ii) if the facility commences operation before 1 July 2023 and Part 3H applies to it—1 July 2026.</p><p class="italic">(3B) A determination that includes the requirements mentioned in subsection (3A) must take effect no later than 1 November 2023.</p><p class="italic">(3) Schedule 1, page 8 (after line 18), after item 29, insert:</p><p class="italic">29A Subsections 22XL(1) and (2)</p><p class="italic">Omit "The", substitute "Subject to subsection (4), the".</p><p class="italic">29B At the end of section 22XL</p><p class="italic">Add:</p><p class="italic"> <i>Methane emissions targets</i></p><p class="italic">(4) The <i>baseline emissions number</i> for a facility mentioned in column 1 of an item of the following table for a financial year mentioned in column 2 of the item must be calculated so as to ensure that the facility does not exceed the emissions target mentioned in column 3 of the item.</p><p class="italic">(4) Schedule 1, item 31, page 8 (after line 29), after paragraph 22XN(1)(a), insert:</p><p class="italic">(aa) the surrender does not reduce the net emissions number for the facility for the period by:</p><p class="italic">(i) in the first year of operation of Division 4A of Part 3H—more than 90%; and</p><p class="italic">(ii) in each subsequent year of operation of that Division—more than 90% minus 10% per year of operation; and</p><p class="italic">(5) Schedule 1, item 31, page 8 (after line 33), after subsection 22XN(1), insert:</p><p class="italic">(1AA) An Australian carbon credit unit may only be surrendered by a person under subsection (1) for the purpose of reducing the net emissions number for a facility for a period if the person has no, or has no more, safeguard mechanism credit units that could be surrendered for that purpose.</p><p>As a guiding principle, the safeguard mechanism must ensure that emissions from the biggest emitters in the country have peaked. My amendments insert that into the objects of the act, identifying that aggregate covered emissions from the operations of designated large facilities decline. It's really important, when we know where we are at in terms of global emissions and Australian emissions, that we make clear that it is time for emissions to reduce. We have had warning after warning, including the latest report from the UN IPCC relating to global temperature estimates and where we are tracking, and we need to make sure that those large facilities understand that from here on in their emissions must reduce. There is understanding and there is flexibility in this system, but there is a line in the sand as well to say that it is time to reduce. For too long they have been left with this wide, broad discretion to continue with business as usual despite all the warnings. So it is incredibly important that, as this amendment makes very clear, now in practice gross emissions must decline to 2030 for large facilities.</p><p>Any increases in production must be done more efficiently, so this is not a cap on productivity, but this is a cap on wasteful productivity or productivity ignoring all of the issues and the warnings around emissions and global warming. This is saying that productivity must be done at best practice. It must be done more efficiently. Any new entrants must display lower-emitting facilities or come in at net-zero.</p><p>Amendment (1) inserts a new object that aggregate covered emissions—that is, gross emissions—must decline. Complementing that is amendment (5), which prioritises the use of safeguard mechanism credits before the use of Australian carbon credit units. The safeguard mechanism credits are generated within the safeguard mechanism. These will be real abatement. These are important. If there is a hierarchy and priority around abatement, it must be first on-site, real abatement and then turn towards credits.</p><p>We know safeguard mechanism credits are generated within the safeguard mechanism. They represent facilities reducing emissions by more than the mandated emissions reductions set by the government. This is good. We want to incentivise this. They represent genuine abatement of emissions from within the safeguard facilities and they should be used first before other offsets through the Australian carbon credit market. Australian carbon credit units are generated outside the safeguard facilities, and these represent a greater diversity of reductions or sequestration techniques that are less directly attributable to these facilities covered under the mechanism and that make it harder for all facilities to demonstrate a reduction in gross emissions.</p><p>We also need to have the discussion about caps on offsets. I believe that, for existing facilities, there should be a cap on the use of Australian carbon credit units to offset emissions. Amendment (4) limits the use of offsets to a maximum of 90 per cent in the first year of the scheme, decreasing by 10 per cent per year thereafter. Again, this is consistent with the goal of reducing gross emissions for facilities covered, forcing investment in improving the carbon efficiency of production and genuine abatement. We need to think about carbon from a circular economy standpoint, manage the impact of carbon currently in the system and keep the carbon stored deep underground and fossil fuels in place.</p><p>My second tranche of amendments are with respect to methane. We must deal with methane. It is an incredibly potent greenhouse gas, being some 26 to 28 times more effective at trapping heat over the life of the methane, and up to 80 times more dangerous in the first 20 years. To that end, the safeguard mechanism must enact global best practice in understanding our methane emissions, be more transparent in reporting them and set limits on the amount of methane that can be emitted by facilities. The amendments seek to implement current global best practice on monitoring, reporting and verifying methane emissions. They also establish best practice standards for methane emissions from gas and coalmines, specifically requiring new oil and gas facilities entering the safeguard scheme to meet a methane intensity target of at least 0.2 per cent within two years and requiring new coal facilities entering the scheme to keep emissions very low. I urge the minister to consider these amendments.</p> <p class="speaker">Chris Bowen</p><p>As I indicated when I closed the debate, the government won't be accepting or supporting any crossbench amendments at this time. I thank all honourable members on the crossbench for their engagement and their many meetings with me over recent weeks. Several of the things that the honourable member for Warringah has put forward will be covered by very similar amendments in the Senate. Not all of them will be covered, but several will be. In the interest of clarity, we'll process those through the other house and not this House. Accordingly, we won't be supporting any amendments moved by the crossbench today. I do respect the integrity and the intent behind many of them. Not all of them we would agree with, but many are reflected in amendments that will be moved in the Senate. I understand my office has already offered honourable members on the crossbench a briefing this afternoon, which I look forward to facilitating for honourable members. The government will be proceeding on that basis.</p> <p class="speaker">Milton Dick</p><p>The question is that the amendments be disagreed to.</p><p>Question agreed to.</p> <p class='motion-notice motion-notice-truncated'>Long debate text truncated.</p>-
- The majority voted in favour of agreeing with the bill as amended. This means they can now decide on whether they agree with its final wording and so pass it in the House, which is known as giving it a [third reading](https://peo.gov.au/understand-our-parliament/how-parliament-works/bills-and-laws/making-a-law-in-the-australian-parliament/).
- ### What does the bill do?
- The [bills digest](https://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/bd/bd2223a/23bd048), which is a document put together by the parliamentary library, sets out the following key points:
- * *Proposed revision of the existing ‘Safeguard Mechanism’ applying to Australia’s largest emitters is a central element of the Australian Government’s commitment to achieve a 43% reduction in greenhouse gas emissions by 2030 and net zero by 2050.*
- * *The Safeguard Mechanism commenced operation on 1 July 2016 and has, to date, operated as a greenhouse gas emissions reporting mechanism for around 212 of Australia’s largest industrial facilities.*
- * *The Safeguard Mechanism (Crediting) Amendment Bill 2022 amends relevant Acts to alter the Safeguard Mechanism so that covered facilities must reduce their scope 1 (direct) emissions in future.*
- * *The primary amendments to the National Greenhouse and Energy Reporting Act 2007 and Australian National Registry of Emissions Units Act 2011 establish the administrative architecture to create ‘safeguard mechanism credit units’ (SMCs). The amendments provide for dealings in SMCs in the same manner as Australian Carbon Credit Units (ACCUs).*
- * *Key elements of the revised scheme will be implemented via amendments to existing legislative instruments (rules) made by the Minister. The Clean Energy Regulator (CER) will also be able to make key determinations, as provided for in these instruments.*
- * *Stakeholders have expressed concern about the limited timeframe for consultation and staggered release of key documents (including legislative instruments and the Independent Review of Australian Carbon Credit Units (Chubb Review)), which they regard as limiting a fulsome consideration of the proposed amendments.*
- * *Moreover, whilst environment and climate focused groups have argued that amendments are insufficient, key industry stakeholders acknowledge the need for change but have expressed concern about particular aspects of the proposed amendments.*
-
-
|