ESG Snapshot: Issue 25

Highlights include:

• Biomethane opportunity. Biomethane could substitute for up to half of Victoria's existing industrial fossil gas use, says the state government.
• Environmental assessment overhaul. WA will make sure state assessments of Safeguard-covered facilities avoid "unnecessary duplication".
• New CRCs. A new Cooperative Research Centre on net-zero agricultural emissions, and another on solving waste plastic, have won federal funding.
• Carbon credits for parks. The NSW government has just received Australian carbon credits worth more than $760,000 for environmental plantings.

Interested in being an environmental specialist in deforestation and high-risk commodities for Woolworths? Or in a job at AGL, Norton Rose Fulbright, Australia Post, or Melbourne Water? Check out this issue's jobs board!

The final text from COP28 is available here. Minister Chris Bowen's initial post-COP comments are here.

Some other COP28 reactions:

• "COP28 was a coming-out party for private sector climate action," said Nathaniel Keohane, president of US think-tank C2ES.
  
  "Companies came not to show and tell, but to have granular, specific conversations about cutting emissions in their operations and value chains, deploying low-carbon technologies, scaling investment in climate action, and promoting adaptation and resilience to the impacts of climate change."
  
• "There is a recognition that COPs are just part of the shift that needs to happen," said the Outrage and Optimism team.
  
  "The transformation doesn't originate from the COPs, it is already happening in the global economy and will be accelerated by entrepreneurs, investors and civil society as well as government."
  
• "Nature gained unprecedented attention at this year's climate COP, but we cannot be complacent," said Eva Zabey, CEO of Business for Nature.
  
  "The destructive financing of nature must cease, businesses must accelerate corporate action to address nature loss and governments need to put in place legislation to reward nature-positive outcomes." 
  
• "Champions for a rapid phase out of fossil fuels – both small island states and major economies – have pushed the rest of the world to realise this transition cannot be stopped," said Tom Evans, E3G Policy Advisor.
  
  "But this is only a small first step. It is clear that not everyone is ready to admit the truth of what’s needed to avert climate disaster. The COP text shows the hard work that lies ahead: rewiring the financial system, driving action to vastly scale up renewables and energy efficiency, and crucially paying much more attention to adaptation which has been neglected, putting all of us at risk." 

The Taskforce on Nature-related Financial Disclosure (TNFD) has released sector-specific guidance for oil and gas, forestry and paper, electric utilities, metals and mining, food and agriculture, chemicals, aquaculture, biotechnology and pharmaceuticals. It has also released additional guidance for financial institutions.

European co-legislators have reached a provisional agreement on the EU’s proposed Corporate Sustainability Due Diligence Directive, which would require large businesses to assess and address adverse human rights and environmental impacts in their value chains.

The Directive still requires formal approval by the EU Council and Parliament.

The federal government has provided $87 million to establish a new Cooperative Research Centre for Zero Net Emissions from Agriculture, and $40 million to establish a Solving Plastic Waste CRC.

The successful bid for a Zero Net Emissions Agricultural Cooperative Research Centre (ZNE-Ag CRC) was led by the University of Queensland and the Queensland Department of Agriculture and Fisheries, and involves a consortium of 73 partners across industry, education and government.

The federal contribution, in conjunction with finance sourced from elsewhere, means the ZNE-Ag CRC has a 10-year budget of $300 million.  

The Solving Plastic Waste CRC bid was led by Griffith University. The CRC's website notes that achieving a circular economy for plastics "will require profound change".

In 2021, Australians used 3.8 million tonnes of plastics, and only 12% of end-of-life plastics were recycled.

There is a 43% chance that the transformation of the National Electricity Market will follow a "step change" scenario, according to the Australian Energy Market Operator's draft 2024 Integrated System Plan.

However, there is only a 15% chance that it will follow a "green energy exports" scenario, which would align with government ambitions for Australia to become a green energy superpower.

Under the step change scenario, at least 90% of the NEM’s coal fleet is forecast to retire before 2035, and the entire fleet will be retired by 2038, AEMO now says.

Under the step change scenario, the lowest cost, optimal pathway for ensuring secure and reliable energy would involve:

• Adding close to 10,000 km of new and upgraded transmission by 2050, with around a quarter underway and half to be delivered in the next decade. (Pursuing the green energy exports scenario would require more than twice as much transmission, delivered at a much faster pace.)
• Tripling grid-scale variable renewable generation by 2030 (57GW) and increasing it seven-fold by 2050 (126GW).
• Adding almost four times the firming capacity from dispatchable storage, hydro and gas-powered generation by 2050 (74GW).
• Supporting a four-fold increase in rooftop solar capacity by 2050 (72 GW).

Delivering the transmission projects  identified in the ISP would avoid $17 billion in additional costs to consumers, compared to not delivering them, AEMO says. Comments on the draft ISP are due by 16 February.

Consultation opportunity. Comments on a new consultation paper on an orderly exit management framework for coal-fired power stations, which would be given statutory force, are due by 2 February.

Transcript of DCCEEW's public webinar on EPBC reform is now available. The transcript points out that, under the proposed reforms, the approval decision-maker will in most cases be the soon-to-be-established independent Environment Protection Australia, not the Environment Minister. 

Grant opportunity. The Australian and UK governments are inviting applications for grants of up to $2 million for hydrogen research, development and demonstration projects. Applications close on 19 January.

The federal government has awarded carbon farming outreach program grants to five organisations - the Aboriginal Biodiversity Conservation Foundation ($2 million, the Kangaroo Island Landscape Board ($1.7 million), Dairy Australia ($1.25 million), the Victorian Department of Energy, Environment and Climate Action ($4.3 million, and the Grower Group Alliance ($8 million).

ARENA is providing not-for-profit organisation EnergyLab with a $1.64 million grant to deliver entrepreneurial support services to renewable energy start-ups.

At COP28, Australia became a signatory to a new Joint declaration on ocean and climate action, pledging to consider ocean-based action in its national climate goals, and to develop a Sustainable Ocean Plan.

Other signatories include the US, the UK, France, Indonesia, and Fiji.

Australia also endorsed the Mangrove Breakthrough, which aims to secure the future of more than 15 million hectares of mangroves globally by 2030, underpinned by US$4 billion of sustainable finance.

EY and the Cambridge Institute for Sustainability Leadership are inviting applications from managers in the private and public sector to participate in the next Sustainability Practitioner Program, which runs from 4 to 6 March.

Open consultations:

• A discussion paper about the proposed First Nations clean energy strategy (comments due by 31 January).
• A consultation paper on developing a fuel quality standard to enable the supply of renewable diesel in Australia (comments are due by 2 February).
• Draft Australian climate-focused disclosure standards released by the Australian Accounting Standards Board (AASB) (comments due by 1 March).

Consultation opportunity. The Department of Environment and Science is inviting comments by 23 February on updated Landfill siting, design, operations and rehabilitation guidance.

Consultation opportunity. The state government is inviting survey responses by 2 February to a review of the Reef Water Quality Improvement Plan.

Statutory development. Queensland's Premier Steven Miles has announced plans to legislate a new 2035 emissions reduction target of 75% below 2005 levels.

A Department of Planning and Environment environmental plantings project has been issued with 24,026 Australian Carbon Credit Units, worth more than $768,800 at the current generic ACCU spot price.

The environmental plantings have been carried out in degraded National Parks reserves that were previously used for forestry, mining or agricultural purposes.

The NSW National Parks and Wildlife Service is the first parks agency in Australia to commit to becoming carbon positive by 2028, and the ACCUs will be used to offset residual NPWS emissions, and generate revenue.

Law firm Herbert Smith Freehills and the Clean Energy Investor Group have released a briefing paper recommending measures to speed NSW approval processes for clean energy projects.

The paper recommends that greater use be made of the Critical State Significant Infrastructure approvals pathway (through ministerial declaration), which has proved faster than the State Significant Development pathway.

The Independent Planning Commission has approved the $370 million, 215MW Oxley solar farm proposed for the New England Renewable Energy Zone. The project will also have a 50MW/50MWh battery.

Consultation opportunity. Comments are due by 4 February on a discussion paper on plastics released by the EPA.

The ACT government has released a Native Species Conservation Plan for koalas.

The state government has released an update to the state's Gas Substitution Roadmap, which proposes additional measures to support the move away from fossil gas.

The update notes that current analysis suggests biomethane could supply up to half of Victoria’s existing industrial fossil gas use.

It also notes that most of Victoria’s industrial gas users are located within 20 kilometres of a potential biogas source – around 70% are within 20 kilometres of a landfill site and around 80% are within 20 kilometres of a wastewater treatment plant.

Additional measures proposed in the update include:

• Investigating options to progressively electrify all new and existing residential and most commercial buildings through a regulatory impact statement process. This process will include an examination of the costs and benefits of requiring existing gas appliances that reach end-of-life to be replaced with electric ones.
• Releasing a policy directions paper in 2024 on scaling up biomethane and renewable hydrogen production.
• Expanding the Victorian Energy Upgrades scheme to include incentives for upgrades to efficient electric cooktops.
• Expanding minimum standards for rented homes to cover ceiling insulation, draught-sealing, hot water and cooling.

EPA Victoria has approved a development licence for Yarra Valley Water to build an anaerobic digestion plant to produce biogas at its Lilydale treatment plant.

The biogas will be combusted onsite in two 1.2 MW combined heat and power units, providing over 13,000 MWh of electricity annually.  

The plant will accept and process approximately 55,000 tonnes of organic waste per year, including oils, grease, food processing residues, dairy effluent and abattoir residues. It will be 50% larger than Yarra Valley Water's existing digester at Wallet, and will earn ACCUs and LGCs.

Open consultations:

• The location of renewable energy zone priority areas (responses are due by 31 January). 
• An EPA proposed method for estimating financial assurance requirements for contaminated land (responses are due by 31 January). 

Consultation opportunities:

• A draft emissions reduction and resilience plan for the state's waste sector, which focuses mainly on the need to reduce the landfill disposal of organic waste (comments due by 19 December).
• A discussion paper on overhauling Tasmania's threatened species strategy (comments due 22 December).

Consultation opportunity and statutory development. Comments are due by 14 February on a discussion paper on the state government's proposed introduction of a new Biodiversity Act.

Statutory development. The state government will amend the Environment Protection Act to streamline environmental approvals processes, following a brief review conducted by former EPA Chair Paul Vogel.

Proposed changes include:

• Ensuring EPA assessments of projects and proposals that are subject to the Safeguard Mechanism avoid "unnecessary duplication".
• Allowing the Environment Minister to direct the EPA to assess a project of State significance within a specified timeframe.
• Allowing other government approvals processes to run in parallel with an EPA approval. 
• Expanding the EPA's board to include more skills-based members.
• Requiring the EPA to have a Statement of Intent from the Environment Minister, recognising the Government's priorities and policies.

A new Sectoral Emissions Reduction Strategy (SERS) lists decarbonisation actions to be implemented in the electricity, industry, transport, building, waste, and agriculture sectors. Actions include:

• Unlocking additional investment in renewable energy in WA's main energy grid;
• Facilitating decarbonisation in the Pilbara through common-use infrastructure for the resources sector, including the creation of renewable generation hubs in consultation with Traditional Owners and other affected communities;
• Developing a Carbon Capture Utilisation and Storage action plan;
• Reviewing the state's Waste Avoidance and Resource Recovery Strategy.

From 2031 onwards, the WA domestic gas market is anticipated to experience a deficit exceeding 100 terajoules per day, which equates to more than 10% of annual demand, according to a new analysis by the Australian Energy Market Operator.

Consultation opportunity and statutory development. The Department of Water and Environmental Regulation is seeking comment by 5 February on draft regulations to implement the federal Industrial Chemicals Environmental Management Standard (IChEMS) in Western Australia.

Applications to join the NT EPA as a Board member are now open. Applications must be lodged by 25 January.

The Middle Arm Sustainable Development Precinct will be a clean energy and jobs powerhouse, says the NT government's 2023 NT Infrastructure Plan and Pipeline and Infrastructure Audit.

The plan also says the NT aims to become a "green digital economy".

"Opportunities like data centres, data embassies and data warehousing all require vast amounts of space and energy," it says. The plan adds that work is underway in collaboration with CSIRO and industry to develop one of the world's largest multi-user, multi-access CCUS hubs in the Territory.

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