The purpose of the National Greenhouse and Energy Reporting Amendment Bill 2009 is to make minor - but important - amendments to the National Greenhouse and Energy Reporting Act 2007.

The National Greenhouse and Energy Reporting Act 2007 commenced on 29 September 2007, establishing a framework for mandatory reporting of greenhouse gas emissions and energy production and consumption by industry.

This framework is valuable in allowing the Government to move forward in its efforts to combat climate change in an economically responsible way.

Under the Act, corporations which exceed certain thresholds are required to register and report emissions and energy data to government. The first reporting period under the Act is the current financial year, 2008-09.

Data collected under the Act will facilitate effective policy making by providing a national repository for emissions data to serve the needs of all Australian governments.

Australia is already recognised as a world leader in the collection of emissions data and the amendments contained in this Bill will only serve to further strengthen our system.

The legislation will underpin the introduction of the Carbon Pollution Reduction Scheme, assist the Government to meet Australia’s international reporting obligations and facilitate the reduction of duplicative industry reporting requirements under existing state, territory and Commonwealth programs.

The amendments in this Bill will improve the functions of the Act and strengthen the audit framework provided for in the Act. It is also important to recognise that the Bill imposes no burdens on industry beyond those originally intended by the Act.

This Bill demonstrates the Government’s continued dedication to an efficient and effective National Greenhouse and Energy Reporting System.

These amendments also support this Government’s commitment to establishing a Carbon Pollution Reduction Scheme using a staged approach to ensure a smooth transition for business’ and other affected parties.

In some cases, the amendments better reflect the original policy intent behind the Act. In other cases, the Bill responds to issues raised by stakeholders in consultations. In particular, the Bill focuses on the audit framework to be established under the Act, and for the Carbon Pollution Reduction Scheme and responds to feedback from consultation on this framework.

This Bill will increase the effectiveness of the audit framework under the Act and corrects potential stakeholder confusion surrounding terminology.

The phrase ‘external auditor’ has been replaced with ‘audit team leader’ and ‘registered greenhouse and energy auditor’ to reduce any confusion relating to the status and role of auditors under the Act.

Another upgrade to the Act requires audit team leaders to register with the Greenhouse and Energy Data Officer. Domestic and international emissions reporting and trading systems include registration or certification to control the quality of the auditor pool. This registration framework will reflect existing domestic and international best practice.

Stakeholder feedback was supportive of a registration process for auditors, and through this amendment the Government is delivering the necessary framework for a robust auditor registration system.

This Bill also allows the Minister to determine, by legislative instrument, the requirements for the preparation, conduct and reporting of audits. This will ensure greater levels of consistency in the conduct of audits and reports provided by auditors. The amendments also clarify that the legislative instrument may outline different types of greenhouse and energy audits. This will provide the regulator with flexibility to target audits towards achieving specific outcomes.

Other amendments protect commercially sensitive information. Stakeholders have told us that reporting entities need confidence that commercially sensitive data will be protected, and this Government is responding.

The Act facilitates greater levels of public information and corporate accountability in relation to greenhouse and energy information. This needs to be balanced with ensuring the legislation does not undermine commercial information that is validly confidential.

To ensure this Bill has the teeth to respond to possible commercial secrecy breaches, the Bill will include an offence relating to the release of ‘audit information’, other than for the purpose of the Act or other Commonwealth, state and territory laws.

Further, under paragraph 23(2)(d) audit team members will be required to keep greenhouse and energy information and audit information obtained under the Act, confidential.

Accountability is an important component of a world-class reporting system. Amendments to section 56 entitle the Administrative Appeals Tribunal (AAT) to review decisions by the Regulator to not register an auditor. This ensures that statutory decision-making is transparent and defensible.

The amendments also give the regulator the power to publish certain audit results. Currently the regulator has no power to disclose information on the outcomes of audits to the public.

Stakeholders agree with us that this power is required. They have indicated a significant interest in the public having access to audit outcomes. This will assist the public to ascertain the reliability of a corporation’s published greenhouse and energy information.

In making this information publicly available, the Government recognises the importance of establishing clear criteria for disclosure. The amendment does not imply that the GEDO must publish the outcomes of certain audits. Rather, after taking a variety of issues into account (including commercially sensitive information) the GEDO may make audit outcomes available to the general public.

The Bill is underpinned by broad stakeholder consultations over the past year and will support the continued development of a world-class National Greenhouse and Energy Reporting System and robust reporting for the Carbon Pollution Reduction Scheme.

In January of this year a consultation paper sought feedback on the removal of the requirement for the regulator to publicly disclose corporate level energy production data. The aim was to eliminate confusion between economy wide energy production statistics produced by the government, and corporate level energy production totals.

Whilst some stakeholders were concerned that this amendment would reduce public access to important greenhouse gas emissions data, it is important to note that the proposed amendment will not impact access to greenhouse gas emissions or energy consumption data.

Rather, the amendment will remove the obligation for the regulator to publish information that is aggregated in such a way as to be unusable and potentially misleading. The proposed amendments will address potential confusion between economy wide energy production statistics produced by the government and corporate level energy production totals.

Importantly, this will not affect the reporting obligations of corporations registered for reporting under the Act. Neither will it affect the publication of corporate-level greenhouse gas and energy consumption data.

Collection of energy production data will remain a key component of the Act, to inform government on energy flows across the Australian economy and to underpin the Australian Bureau of Agricultural and Resource Economics’ energy statistics. The Australian Energy Statistics provides public data on energy production that is readily interpreted and useable.

The National Greenhouse and Energy Reporting System provides for comprehensive reporting of greenhouse and energy data. It will also eliminate duplicative industry reporting requirements under the existing patch-work of state, territory and Commonwealth greenhouse gas and energy programs. It provides a centralised repository for data which will serve the needs of all Australian governments and the Australian public.

The Government will continue working with the states and territories through the Council of Australian Governments (COAG) to identify opportunities for further streamlining of reporting requirements via this system.

Since the public release of the NGER Amendment Bill 2009, the Government has received additional feedback from industry seeking increased flexibility in establishing reporting arrangements under the National Greenhouse and Energy Reporting System from the first reporting year of 2008-2009.

To provide this increased flexibility, the Government has moved additional amendments which introduce the ‘Reporting Transfer Certificate’ concept. This concept allows the voluntary transfer of reporting responsibility from a controlling corporation where one member of its group has operational control of a facility to a member of a different corporate group that has financial control of that facility.

Importantly, holders of a Reporting Transfer Certificate will take on all reporting obligations and liabilities under the Act, and will be a constitutional corporation in line with current coverage of the Act.

To enable the Reporting Transfer Certificate concept, the amendments also introduce new terminology, concepts and rules outlining how and when Reporting Transfer Certificates are applied for, issued, surrendered and cancelled.

By design, the provisions will closely reflect the existing Category B Liability Transfer Certificate provisions outlined in the Carbon Pollution Reduction Scheme legislation. This will promote consistency between the National Greenhouse and Energy Reporting System’s reporting regime and the future Carbon Pollution Reduction Scheme, thereby ensuring a high degree of continuity between current and future reporting arrangements.

The Reporting Transfer Certificate concept, which applies until 30 June 2011, does not impose any financial liability. With the introduction of the Carbon Pollution Reduction Scheme, corporations with operational and financial control of a facility will need to apply for a Liability Transfer Certificate with the Scheme Authority should they wish to transfer liability under the Scheme.

These additional provisions are to commence on the day after Royal Assent and will be voluntary, reduce administration and economic costs on industry and impose no additional burden on industry stakeholders beyond those originally intended by the Act.

This Bill is the result of continued comprehensive stakeholder consultation on the Act and the Carbon Pollution Reduction Scheme. Consultation has included numerous discussions papers seeking stakeholder feedback, workshops and one-on-one discussions with key affected parties.

We’ve struck a balance between disclosing useful information to the public, through including provisions for disclosure of audit outcomes, whilst protecting commercially sensitive information.

The amendments will make the audit framework for the Act and the Carbon Pollution Reduction Scheme more robust, to support this Government’s commitment to economy-wide accountability for greenhouse gas emissions production and energy use.

I commend this Bill.