ESG Snapshot: Issue 50

This week's highlights include:

• Transmission projects advance. A key NSW transmission project has received planning approval, and another has made an EPBC referral.
• Two new climate appointments. The Climate Change Authority has a new Chair and another new board member.
• New ministerial council. Water ministers have agreed to reinvigorate Australia's blueprint for sustainable water management.
• From 10% to 54%. Three years ago it was rare for companies to factor climate action into executive bonuses, now a slim majority do it, says a new study.
• Tax credits. Treasury has released discussion papers on production incentives for hydrogen and critical minerals.
• Battery fires. Three states will work on model legislation to tackle the rising number of battery fires.
• Good neighbours. The term 'good neighbourliness' in Australia's climate-focused agreement with Tuvalu has a specific meaning in international environmental law, the Joint Treaties Committee has heard.
• Barramundi grant. ARENA grants to 10 companies include money for Paper Australia to investigate a geothermal barramundi farm near its Maryvale mill.

Do you want to join the talent register to help with preparations for the COP31 climate conference? Check out this issue's jobs! Final reminder - Professor John Daley will deliver the Fiona Wain Oration this evening in Sydney.

ESG Snapshot - powered by the Business Council for Sustainable Development Australia and curated by Earthed.

A Water Ministerial Council has convened for the first time in 20 years, with ministers agreeing to reinvigorate the 2004 National Water Initiative, which has long been Australia’s blueprint for sustainable water resource management.

Ministers noted the Productivity Commission's 2024 final report on water reform (below) identified an urgent need to renew the National Water Initiative.

The Murray-Darling Basin Ministerial Council also met on Friday, discussing matters including water market reform.

The Productivity Commission has released its final report on water reform, which recommends an overhaul of the National Water Initiative so it better addresses climate change and changing water demand, and strengthens commitments to protect the interests and values of First Nations peoples.

"Attention needs to be paid to the water planning and modelling aspect of climate change management to ensure Australia will have sufficient water to achieve its net zero transition," the report adds.

Meanwhile, DCCEEW has released a new framework that is designed to assess the water security status of towns and cities.

Labor and Coalition members of a Senate committee inquiry into Senator David Pocock's intergenerational climate equity Bill - which would amend the Climate Change Act - have recommended that the Bill not be passed.

The private member's Bill would create new statutory duties requiring decision-makers to consider the health and wellbeing of children when making decisions that increase greenhouse gas emissions.

It would also prevent approvals for the exploration or extraction of coal, oil or gas, if the resulting greenhouse gas emissions are likely to pose a material risk of harm to the health and wellbeing of current and future children.

In their majority report, government and Opposition senators recommend that the government consider using the Australian Human Rights Commission's Child Rights Impact Assessment Tool to assist in decision making.

In their dissenting reports, Senator Pocock and Greens Senator Sarah Hanson-Young recommended passage of the Bill.

Academic Sarah Krause has told a Joint Treaties Committee hearing on an Australia-Tuvalu agreement that its "many notable elements" include the use of the term 'good neighbourliness'.

The term "has specific legal meaning under international environmental law", Krause told the inquiry.

"The term refers to an obligation owed to neighbouring states to prevent the occurrence of transboundary environmental harm," she said. "Its usage in the treaty is distinctive, as it suggests that Australia recognises the specific legal obligations owed to its Pacific neighbours with respect to climate change."

In addition to appointing former NSW Treasurer Matt Kean as the new Chair of the Climate Change Authority, the government has appointed Patty Akopiantz to the Authority's board.

Akopiantz is is a co-founder of Assembly Climate Capital, an impact investment firm which invests in companies and ideas that can have significant climate impact. She is also a non-executive director of Sea Forest, which is pioneering the commercialisation of seaweed supplements to reduce animal methane emissions.

She is a member of Chief Executive Women, and is an external independent board member at KPMG.

Debate is continuing in the House of Representatives on the government's Nature Positive bills, which would establish Environment Protection Australia and Environment Information Australia.

Treasurer Jim Chalmers has appointed former senior climate change bureaucrat Barry Sterland to the Productivity Commission. Sterland was most recently national lead and global co-lead of KPMG's climate advisory service.

Following a recent meeting of environment ministers, which discussed battery fires, NSW Environment Minister Penny Sharpe has confirmed that NSW, Queensland and Victoria will start work on model legislation to deal with the issue.

NSW will immediately start work on a draft Regulatory Impact Statement, which will assess the costs and benefits of product stewardship models, and which will also consider how reforms would relate to the existing B-Cycle scheme.

"Fire and Rescue NSW attended more than 270 lithium-ion battery fires in 2023 alone," Sharpe noted.

The reporting date for the Senate committee greenwashing inquiry has been pushed back to 20 November, while the reporting date for the Senate committee inquiry into Australia's extinction crisis has been extended to 26 March next year.

ARENA has awarded a total of $1.98 million to 10 businesses to assess their capacity to use renewable technologies in novel ways.

The funding includes:

• $399,503 for G&K O’Connor to achieve comprehensive decarbonisation for a meat processing facility in Pakenham.
• $110,000 for Paper Australia to investigate using a deep-bore geothermal heating system for a proposed barramundi farm near its Maryvale mill.
• $149,850 for Unilever to develop a decarbonisation roadmap for three factories across NSW and Victoria.
• $242,924 for George Weston Food to modernise refrigeration infrastructure at a smallgoods facility in Castlemaine.
• $205,000 for Beston Global Food Company for site-wide energy efficiency and electrification projects at its Jervois cheese plant.
• $147,800 for Bindaree Beef to investigate biomass processing options to harness energy from waste and a meat processing facility in Inverell.

Meanwhile, ARENA will also provide grants totalling $143 million to support the roll out of up to 370 community batteries across Australia.

Consultation opportunity - hydrogen and critical minerals tax credits. Treasury has released discussion papers on its proposed tax incentives regimes for green hydrogen and critical minerals. Comments are due by 12 July.

The Clean Energy Finance Corporation has released new guidelines for institutional investors that describe the metrics it uses to assess existing and potential natural capital investments.

The guidelines were prepared with the assistance of EY.

ARENA has awarded a $12.8 million grant to freight and logistics provider ANC, to support its $45.5 million Project Spark initiative, which aims to overcome barriers that are deterring its owner-drivers from leasing electric vehicles.

ANC manages a network of contracted owner-drivers that provide last-mile delivery services to brands including IKEA, JB HI-FI, and Bunnings.  

More than half (54%) of the ASX200 now factor in climate change when determining executive bonuses, up from only 10% in FY20, a new Australian Council of Superannuation Investors analysis shows.

However, the metrics used are often vague and opaque, the study says.  

The first auction of the Capacity Investment Scheme, which will support 6GW of new power, has received more than 40GW of project registrations, according to Climate Change Minister Chris Bowen.

The Australian Energy Market Operator has released a 25-year roadmap to transition the National Electricity Market to net zero by 2050.

AEMO's Integrated System Plan confirms that renewable energy, firmed with storage, and backed by gas-powered generation, is the lowest-cost way to supply electricity to homes and businesses as Australia transitions to a net zero economy.

Resources Minister Madeleine King has issued two declarations regarding identified CO2 storage sites off the WA cost - one in the Cliff Head formation, and one in the Calliance formation.

UNESCO has released its latest draft decision on the state of conservation of the Great Barrier Reef.

The draft decision requests Australia to report back to the Committee in 2025, with an update on progress on actions to protect and manage the Reef. It also requests that Australia to provide a state of conservation report by 1 February 2026, for consideration at the World Heritage Committee's 48th session in 2026.

The state government has released terms of reference for the development of a new Sustainable Timber Industry Framework.

The 30-year framework, to be finalised next year, will be backed by a $200 million package of measures to support for timber plantation expansion and innovation in timber processing. The package will also fund a state-wide assessment of biodiversity values mapping.

Grant opportunity. The state government is offering grants of up to $10 million for recycling projects, with a focus on projects that process mixed commercial and industrial waste, end-of-life renewable energy infrastructure, and end-of-life electric and electronic products. A total of $45 million is on offer.

Open consultations

• Reef water quality. The state government is conducting a survey for its review of the Reef 2050 Water Quality Improvement Plan, with responses due by 30 September.

The Central-West Orana Renewable Energy Zone transmission project has secured planning approval.

The project is expected to drive up to $20 billion in private investment in solar, wind and energy storage projects, supporting around 5,000 jobs during peak construction.

Planning approval of transmission lines will mean work can begin on the construction of about 240km of lines and supporting infrastructure within the Central West Orana REZ. 

The NSW Energy Corporation has made an EPBC referral for the Hunter transmission project, which will comprise a 500kV transmission line of around 100km, connecting two existing transmission lines. 

"It must be built by the end of 2028 to protect energy security in NSW as the remaining coal-fired powerstations close," the referral says. 

"The proposed action will provide 5GW of additional transfer capacity in the region and unlock the supply of electricity from the Central-West Orana and New England REZs," it says.

"This electricity will be imported to the core grid via the 500 kV Ring and then delivered to consumers in the Hunter, Sydney andIllawarra where 80% of the State’s electricity is used," it says.

Open consultations:

• Waste reforms. The EPA is considering gradually increasing waste levies, above the inflation rate, to reduce the amount of waste sent to landfill, and is inviting comments on a discussion paper by 15 July. It is also seeking comments by the same date on proposed food and organic waste reforms.

Submissions to a Victorian parliamentary inquiry into climate resilience are now available. The committee is due to report next June.

A separate committee inquiry into Victoria's 2022 flood event is due to report soon.

Equis Australia has made an EPBC referral for its proposed 224 MW Bell Bay wind farm.

The EPA is calling for nominations for the 2024 Sustainability Awards. Nominations close on 31 July.  

Tilt Renewables has made an EPBC referral for its proposed 288MW Palmer wind farm.

Up to 4,300 WA households will benefit from home energy upgades, through a $63.2 million partnership between the federal and state governments to upgrade social housing properties across the state.

The Territory government is offering businesses grants of up to $20,000 to invest in equipment or technology which improves recycling. A total of $500,000 is available, and applications close on 30 June next year, or sooner if funds are exhausted.

The UK Supreme Court has ruled that a County Council acted unlawfully in granting planning permission for the expansion of oil-drilling operations without considering the scope 3 impacts when the oil is used as fuel.

The ruling "has the potential to completely alter the landscape for the oil and gas industry in the UK", according to two academics who have followed the case.

Two Australian-headquartered companies - BHP and Nickel Industries Ltd - are among 20 additional companies that will be the focus of investor engagement on nature loss, under a Principles for Responsible Investment initiative.

The PRI in February announced the first 40 companies that would be targeted under its Spring initiative. The first tranche included only one Australian company - South32.

Canada has released its 2030 Nature Strategy and a Nature Accountability Bill.

A group of European NGOs will take the European Commission to the EU's top court over the 10-year re-authorisation of glyphosate, a widely used weedkiller.

In November 2023, EU member states failed to reach a majority decision on whether to extent the authorisation for glyphosate beyond its December expiry date.

Under EU law, the Commission can decide on the authorisation renewal in such cases, and it opted to allow the substance to be sold on the EU market for another ten years.

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