ESG Snapshot: Issue 53
![ESG Snapshot: Issue 53](/content/images/size/w1200/2023/06/image-3.png)
This week's highlights include:
- Values-driven. Climate and energy ministers appear to have tweaked their approach to valuing emissions reductions, and have agreed to refresh the national E3 efficiency scheme.
- Offsets overhaul. NSW will overhaul and strengthen its biodiversity offset scheme, in response to a review by Ken Henry.
- CCS inquiry. A Senate committee has recommended that onshore CCS be covered by the EPBC water trigger.
- EPA changes. The Business Council of Australia says the powers of the proposed federal EPA are too broad, while the Australian Conservation Foundation wants stricter governance arrangements.
- New ASX move. The ASX has signalled it will this month launch a suite of environmental futures contracts.
- New infrastructure tool. The Infrastructure Sustainability Council has released a new rating tool for sub-$100 million infrastructure projects.
- Hydrogen by-product. A Victorian water utility has won an ARENA grant to take by-product oxygen from an electrolyser and use it to treat wastewater.
- Retrospective law. The Tasmanian government has issued a draft Bill to legitimise proposed coastal works for a wind farm.
- COP29. The president of the COP29 climate summit, Mukhtar Babayev, has outlined his ambitions for the negotiations.
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The Energy and Climate Change Ministerial Council has released a national roadmap for Consumer Energy Resources, to coordinate the role of household solar and batteries in the grid, and maximise their benefits.
At their meeting in Melbourne, ministers also appear to have put on hold scheduled annual increases in the estimated value of emissions reductions (VERs), which were set earlier this year on an interim basis by the Australian Energy Regulator (AER).
The values - which are not a carbon price, but allow the benefits of emissions reductions to be quantified - were in turn used by AEMO in the finalisation of its Integrated System Plan.
The AER had proposed that the interim values increase gradually, from $66 last year, to $70 this year, to $80 in 2026, then rising to $105 in 2030.
However, in a move that appears to temporarily halt the gradual rise, ministers agreed "to extend the interim Value of Emissions Reduction to June 2026 to allow sufficient time for the development of a longer-term VER whilst still providing certainty to market bodies and participants".
In addition, the Council agreed to develop a new strategic plan for the national E3 energy efficiency and labelling scheme, and undertook to expedite the implementation of minimum energy performance standards for heat pump hot water systems as a priority.
Ministers also:
- received an update on work by the federal and NT governments on scope 3 emissions from the Beetaloo Basin.
- agreed to release national guidelines for community engagement for transmission infrastructure.
- received an updated on building energy performance reforms.
- discussed progress on the development of Net Zero sector plans, focusing on the plan for the electricity and energy sector.
- welcomed an update on the First Nations clean energy strategy.
- agreed to a national statement of intent for regional and remote EV charging infrastructure.
- received a briefing on Victoria's integrated plan for an orderly energy transition.
Ministers are scheduled to meet again in December.
A Senate committee inquiring into Glencore's now-prohibited proposal for an onshore CCS project has recommended that the water trigger in the EPBC Act be updated "to include onshore CCS".
The committee's report into the project, which has been halted by the Queensland government, also recommends that states and territories consider a legislated ban on CCS activities across the Great Artesian Basin "to ensure this important natural asset is uniformly preserved".
Coalition members of the committee supported both recommendations "in principle". However, they did not support a "blanket" application of the water trigger to national CCS projects, and they noted that that Coalition remains supportive of CCS.
Meanwhile, the National Farmers Federation has launched Federal Court proceedings seeking to have set aside a decision by Environment Minister Tanya Plibersek that the Glencore proposal was not a controlled action under the EPBC Act. Hearings are scheduled for the first two days of August.
Statutory development - Guarantee of Origin. The federal government is working to finalise legislation for its Guarantee of Origin scheme, with the aim of having the emissions accounting scheme operational early next year.
Assistant Minister for Climate and Energy Jenny McAllister described the scheme as "the most important green industry program you never heard of".
"As the world decarbonises, it will be increasingly important for businesses to be able to account for the carbon emissions associated with their products," McAllister said.
The scheme will issue digital certificates that allow producers, exporters and users to prove where a product was made, and the emissions associated with its production and transport.
The scheme will commence with hydrogen, and will then expand to include low carbon liquid fuels like sustainable aviation fuel, green metals like steel and aluminium, and biomethane and biogas.
The Guarantee of Origin scheme will be supported by the Renewable Electricity Guarantee of Origin scheme, which will issue digital certificates proving when, where and how renewable energy was produced. The scheme will replace the RET in 2030 as the framework for certifying renewable electricity.
"We don’t have the luxury of delaying investment in new generation for another 15 or 20 years while we wait for a new form of energy generation that Australia has never had," Climate Change Minister Chris Bowen has told the National Press Club.
"Because this is the critical decade, it also needs to be the decisive decade," Bowen said.
"Now you might have heard certain politicians say it is government policy to build 28,000 kilometres of transmission lines," the Minister said. "This isn’t true. Never has been."
"We are supporting the building of 4,000 kilometres of transmission lines over the next decade plus the upgrading of another 1,000 kilometres."
"Of the 4,000 kilometres actually required – 900 kilometres are complete or well under physical construction."
Climate Change Minister Chris Bowen is in China to attend the 8th Ministerial on Climate Action (MOCA), taking place today and tomorrow.
The Business Council of Australia says it has "serious concerns" about giving the proposed new federal EPA delegated decision-making powers, and is deeply concerned about lobbying by others for the inclusion of a "climate trigger" in the EPBC Act.
Its submission to a Senate inquiry into the government's Nature Positive bills also calls for a three-year delay before proposed new penalty provisions enter into force.
Meanwhile, an Australian Conservation Foundation submission to the same inquiry makes 15 recommendations, including the establishment of a governance board for the EPA, and the creation of a joint parliamentary committee for the environment to oversee it.
The ASX has said it will this month launch a suite of environmental futures contracts, to help businesses hedge the economic risk of the transition. (An outline of the futures contracts can be found in an ASX chapter in a Carbon Markets Institute publication here.)
The ASX is also listing a new deliverable "natural gas futures contract" in August, covering Queensland's Wallumbilla Gas Supply Hub in Queensland. The contract was developed in collaboration with the Australian Energy Market Operator.
A new discussion paper from the government-commissioned carbon leakage review headed by Professor Frank Jotzo is expected very soon.
In a speech to the Australian Clean Energy Summit, shadow climate change and energy minister Ted O'Brien said "getting to net zero is so hard, the last thing we can do is take any option off the table".
"We believe not in putting all our eggs in one basket, but a balanced energy mix," O'Brien said.
"Today that balance is through renewables, gas and coal. However, as coal retires from the system, we believe it should be replaced with zero emissions nuclear energy," he said.
Meanwhile, in other summit speeches, DCCEEW deputy secretary Simon Duggan detailed precautions built into the Capacity Investment Scheme to prevent unwanted, detrimental impacts, and Australian Energy Market Operator chief executive Daniel Westerman discussed the Integrated System plan.
A YouTube video of a leaders' panel session from the summit is also available.
A July 19 and 22 meeting of the Australian Accounting Standards Board will consider papers on climate change and sustainability disclosure, including one that recommends stronger alignment with the IFRS Sustainability Disclosure Standards baseline.
The Productivity Commission, in a submission to a Senate inquiry on the impact of climate risk on insurance premiums and availability, recommends that governments increase their investment in natural disaster mitigation works,
and that they phase out taxes and levies on insurance.
Santos, Tamboran Resources, Inpex, the Department of Climate Change, Energy, the Environment and Water, and the NT EPA, have aill recently submitted answers to questions on notice as part of the Senate committee inquiry into the Middle Arm development.
So too have organisations including the Australian Energy Producers and the Australian Conservation Foundation.
Santos advises in its answer that, for its Barossa project, the company last year executed agreements to build a portfolio of projects supporting the development of five nature-based projects across Queensland, Alaska, and PNG to generate carbon credits.
Last year it also entered into forward contracts for the purchase of 2.5 million ACCUs at fixed prices to be delivered and paid between December 2023 and January 2027.
"Santos will meet its obligations under the Safeguard Mechanism and subject to a future investment decision may offset emissions through CCS at Bayu-Undan," its response says.
A Senate committee inquiring into the government's Nature Positive bills has scheduled a hearing for this Friday, with the program yet to be finalised.
The federal government is providing a $2.5 million grant for a new CSIRO research program to strengthen international collaboration on critical minerals science.
The grant is being provided through the Australian Critical Minerals R&D Hub.
The Infrastructure Sustainability Council has released a new rating tool designed specifically for small infrastructure projects valued at $5 million to $100 million.
A new report on the costs of transmission delays finds that for NSW small business customers with a 40 MWh electricity consumption, a three-year delay in transmission delivery has a cumulative impact on bills over 20 years of $7,716.
The impact is significantly smaller for small businesses in other states. For larger NSW businesses with a 4,000MWh annual electricity consumption, a three year delay would add $771,572 to their energy bills over the same period.
The report was prepared by Nexa Advisory, for Re-Alliance, which has members comprising environmental groups and the Electrical Trades Union.
Eighteen industry and environment bodies, including AI Group, the National Farmers Federation, the Australian Steel Council, and the Investor Group on Climate Change, have issued a joint statement on the need for climate and energy policy certainty.
The Australian Centre for Corporate Responsibility has released the findings of a global survey of investors focused on steel decarbonisation.
Click here for open consultations
- Transport. The federal government has released a consultation roadmap on achieving net zero in the transport sector, with comments due by 26 July.
- Offshore wind consultation. A Senate committee inquiry is calling for submissions by 30 August.
- Commercial building energy efficiency disclosure. By 2035, information on the energy efficiency of most commercial buildings would have to disclosed when they are offered for sale or lease, a DCCEEW consultation paper proposes. Comments are due by 13 September.
![Queensland](https://snapshot.bcsda.org.au/content/images/2023/06/Queenland.png)
Iberdrola has made an EPBC referral for its proposed 500MW Gin Gin Battery Energy Storage System, near Bundaberg.
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.
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Statutory development - nature protection. The state government has released its response to the statutory reviews of the Biodiversity Conservation Act 2016 (by Ken Henry), and the native vegetation provisions of the Local Land Services Act 2013.
Changes prompted by the Ken Henry review include reform of the biodiversity offsets scheme, by requiring it to go beyond the current "no net loss" approach and transition to delivering "net positive" outcomes.
New powers will also be introduced that enable limits to be imposed on proponents' ability to meet a biodiversity offset requirement simply by paying into the Biodiversity Conservation Fund, instead of acquiring credits.
Major mining companies will no longer be able to meet their biodiversity credit obligations through on-site ecological mine site rehabilitation.
"We will consider whether a new offsets mechanism is required specifically to meet the urgency of the Electricity Infrastructure Roadmap," the response adds. "This acknowledges the dual imperatives of climate and biodiversity, and the need to maximise strategic biodiversity outcomes."
The state government will also work with its federal counterpart on the development of the national Nature Repair Market and national carbon market, and design NSW natural capital programs and projects to leverage national schemes.
In some circumstances, concurrence from the Minister for the Environment will be required for state significant development or state significant infrastructure projects.
NSW will also become the first Australian jurisdiction to develop and implement local and statewide natural capital accounting frameworks. These frameworks will provide aggregated data on stocks and flows of natural capital, to inform government decision-making and monitoring, and support nature-based markets.
The state government will also pilot regional and property-scale natural capital accounting and investment frameworks, and it will generally upgrade the gathering and management of biodiversity data.
The government will also amend the Biodiversity Conservation Act to require the development of a NSW Nature Strategy to guide actions to protect, restore and enhance ecosystems and landscapes.
It will also identify and map areas of high biodiversity value.
As a result of the Local Land Services Act review, the state government will also strengthen the Code that operates under the auspices of the Act, reinstate caps on land clearing, and incentivise landholders to protect and restore native vegetation, and increase notification requirements.
The state government has released a framework for setting priorities under its Saving Our Species program, which says priority will be given to cost-effective projects that are strategic, and that maximise conservation benefit across the state.
The state government has placed on exhibition the EIS for Iberdrola's Kingswood 500MW/1000MWh battery energy storage system, to be located near Tamworth.
IPART is seeking feedback on draft conditions for granting a transmission operator's licence to ACEREZ Partnership (ACEREZ) to operate the transmission system connecting the Central West Orana renewable energy zone to the NSW grid.
ACEREZ has received planning approval for the project, and is now applying for a transmission operator's licence application on the same day.
Due to access needs for two Renewable Energy Zones, the state government has reclassified two key local roads as state roads.
![Victoria](https://snapshot.bcsda.org.au/content/images/2023/06/Victoria.png)
Great Eastern Offshore Wind, owned by Macquarie Green Investment Group, has made an EPBC referral for preliminary site investigations for its proposed 2.5GW project off the coast of Gippsland.
Barwon Water, with the assistance of a new $3 million grant from ARENA, will investigate using oxygen to treat wastewater at a Geelong treatment plant.
The oxygen would be produced as a byproduct of renewable hydrogen production by Viva Energy at its Geelong site, via a 2.5MW electrolyser.
ARENA chief executive Darren Miller said Barwon Water's project will highlight how renewable hydrogen producers and wastewater treatment players can work together to decarbonise.
![](https://snapshot.bcsda.org.au/content/images/2023/08/image-2.png)
Statutory development - coastal policy. The Tasmanian Government has released draft legislation on coastal infrastructure.
The move follows advice received earlier this year about the application of the Tasmanian State Coastal Policy to the Robbins Island wind farm.
The draft Bill seeks to validate previous permits issued for coastal infrastructure under the Land Use Planning and Approvals Act 1993 (LUPAA) from 25 February 2009 until the date of the commencement of the proposed legislation.
It also ensures that no action can be taken against individuals or organisations that have acted in line with permits issued under LUPAA.
Submissions are due by 1 August.
The state government has significantly raised the limit constraining Hydro Tasmania capacity to develop new energy generation.
The legislative constraint has been lifted from 40MW to 300MW.
![](https://snapshot.bcsda.org.au/content/images/2023/09/image-1.png)
The federal government will provide $20 million to support a new soft Recycling Plastics Australia plastics recycling facility in Kilburn.
The facility will process more than 14,000 tonnes of soft plastics annually. It is being funded through the Recycling Modernisation Fund Plastics Technology stream.
![Northern Territory](https://snapshot.bcsda.org.au/content/images/2023/06/NT.png)
The NT government has signed two MoUs have been signed with the Japan Organisation for Metals and Energy Security (JOCMEC).
The first MoU establishes a framework for cooperation in fossil gas, carbon capture and storage, and hydrogen production. The second focuses on greater collaboration with critical mineral supply chains.
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BlackRock has released new climate and decarbonisation stewardship guidelines.
Chevron Phillips Chemicals has released its latest sustainability report.
Sustainability consultancy ERM has released its FY24 sustainability report, which says that the company increased sales from low-carbon transition projects by 28% over the year.
A report by Greenpeace accuses several meat and dairy companies, including Fonterra and Nestlé, of relying on "weak voluntary targets, green marketing and promises of future technological fixes", while lobbying "behind the scenes to delay and derail progressive legislation" on methane.
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Only a third of the emissions reductions required for the UK to meet its 2030 target are currently covered by credible plans, according to a new report from the UK Climate Change Committee.
The Committee makes ten recommendations, including making electricity cheaper, removing planning barriers for heat pumps, onshore wind and EV charging, and finalising business models for engineered removals of emissions.
The UN Environment Programme Finance Initiative (UNEP FI) has released two reports for banks on the circular economy.
One report examines the linkages between circularity and sustainability impact, and the other discusses using circular solutions to achieve climate targets.
A meeting of the Green Climate Fund Board has concluded with approval of USD $1.0 billion in financing for 17 projects in 35 developing countries.
The OECD has released a new working paper on Bridging the clean energy investment gap, and another on the interplay between compliance and voluntary carbon markets.
The New Zealand government has released a discussion paper on the country's second emissions reduction plan (for 2026 to 2030).
President of this year's COP29 climate conference, Mukhtar Babayev, has written an open letter on his goals for this year's conference. A key priority will be delivering a new goal for climate finance, the letter says.
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