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Carbon Pollution Reduction Scheme Bill 2009 [No. 2]

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2008-2009

 

The Parliament of the

Commonwealth of Australia

 

THE SENATE

 

 

 

Carbon Pollution Reduction Scheme Bill 2009

 

 

(1)     Clause 5, page 5 (after line 13), after the definition of acquire , insert:

adjusted base period fugitive emissions intensity number has the meaning given by section 173U.

adjusted base period fugitive emissions number has the meaning given by section 173V.

[coal mining]

(2)     Clause 5, page 7 (after line 10), after the definition of Authority , insert:

base period fugitive emissions number has the meaning given by section 173S.

base period saleable coal number has the meaning given by section 173T.

[coal mining]

(3)     Clause 5, page 7 (after line 22), after the definition of cancellation account , insert:

capped base period saleable coal number has the meaning given by section 173TA.

[coal mining]

(4)     Clause 5, page 8 (after line 11), after the definition of certificate of eligible synthetic greenhouse gas destruction , insert:

certificate of entitlement to coal mining assistance means a certificate issued under section 173K.

[coal mining]

(5)     Clause 5, page 8 (after line 32), after the definition of coal-based char , insert:

coal mining control test has the meaning given by section 173W.

coal mining title means:

                     (a)  a lease that:

                              (i)  permits the lessee to extract coal from the whole or a part of the area of land covered by the lease; and

                             (ii)  is granted by or under a law of the Commonwealth, a State or a Territory; or

                     (b)  a licence that:

                              (i)  permits the licensee to extract coal from the whole or a part of the area of land covered by the licence; and

                             (ii)  is issued by or under a law of the Commonwealth, a State or a Territory; or

                     (c)  an authority that:

                              (i)  permits the holder of the authority to extract coal from the whole or a part of the area of land covered by the authority; and

                             (ii)  is given by or under a law of the Commonwealth, a State or a Territory.

For the purposes of this definition, land includes submerged land.

[coal mining]

(6)     Clause 5, page 11 (after line 4), after the definition of electronic notice transmitted to the Authority , insert:

eligible coal mining area has the meaning given by section 173R.

[coal mining]

(7)     Clause 5, page 16 (after line 3), after the definition of fuel oil , insert:

fugitive emissions has the meaning given by the regulations.

[coal mining]

(8)     Clause 5, page 25 (after line 25), after the definition of reviewable decision , insert:

saleable coal has the meaning given by the regulations.

[coal mining]

(9)     Clause 13, page 33 (after line 17), after paragraph (b) of the note, insert:

(ba)  the total number of free Australian emissions units issued in accordance with Part 8A (coal mining); and

[coal mining]

(10)   Clause 82, page 128 (after line 15), after paragraph (b) of the dot-point relating to the national scheme cap, insert:

             (ba)     the total number of free Australian emissions units issued in accordance with Part 8A (coal mining); and

[coal mining]

(11)   Clause 88, page 131 (after line 16), after paragraph (c), insert:

                    (ca)  in accordance with Part 8A (coal mining); or

[coal mining]

(12)   Clause 93, page 137 (after line 3), after paragraph (1)(b), insert:

                   (ba)  the total number of free Australian emissions units with that vintage year issued in accordance with Part 8A (coal mining); and

[coal mining]

(13)   Clause 101, page 141 (after line 25), after subparagraph (1)(a)(i), insert:

                            (ia)  in accordance with Part 8A (coal mining); or

[coal mining]

(14)   Clause 103A, page 143 (after line 31), after subparagraph (1)(a)(i), insert:

                            (ia)  in accordance with Part 8A (coal mining); or

[coal mining]

(15)   Clause 103B, page 144 (after line 18), after subparagraph (1)(a)(i), insert:

                            (ia)  in accordance with Part 8A (coal mining); or

[coal mining]

(16)   Clause 129, page 173 (after line 10), after subparagraph (5A)(a)(i), insert:

                            (ia)  in accordance with Part 8A (coal mining); or

[coal mining]

(17)   Clause 167, page 207 (after line 15), after subclause (2), insert:

          (2A)  Before 30 June 2016, the emissions-intensive trade-exposed assistance program must not provide that the extraction of coal is an activity that, under the program, is taken to be an emissions-intensive trade-exposed activity.

[coal mining]

(18)   Page 210 (after line 30), after Part 8, insert:

Part 8A Coal mining

Division 1 Introduction

173D   Object

                   The object of this Part is to provide limited transitional assistance in respect of coal mining that has significant fugitive emissions of greenhouse gases.

173E   Simplified outline

                   The following is a simplified outline of this Act:

•      Free Australian emissions units may be issued in respect of coal mining that meets certain eligibility requirements.

•      Free units will be issued during:

               (a)     the financial year beginning on 1 July 2011; and

              (b)     each of the next 4 financial years.

•      The number of free units is capped.

Division 2 Issue of free Australian emissions units in respect of coal mining

173F   Issue of free Australian emissions units in respect of coal mining

Scope

             (1)  This section applies if a certificate of entitlement to coal mining assistance is in force in respect of an eligible coal mining area for an eligible financial year.

Note:          For eligible coal mining area , see section 173R.

Issue of free units

             (2)  As soon as practicable after the day on which the certificate was issued, the Authority must issue to the holder of the certificate a number of free Australian emissions units equal to the number specified in the certificate as the unit entitlement for that certificate.

             (3)  Free Australian emissions units issued in accordance with subsection (2) during an eligible financial year are to have a vintage year of the eligible financial year.

             (4)  The Authority must not issue a free Australian emissions unit to a person in accordance with subsection (2) unless the person has a Registry account.

Division 3 Certificate of entitlement to coal mining assistance

173G   Application for certificate of entitlement to coal mining assistance

             (1)  During the first 4 months of:

                     (a)  the eligible financial year beginning on 1 July 2011; or

                     (b)  the eligible financial year beginning on 1 July 2012; or

                     (c)  the eligible financial year beginning on 1 July 2013; or

                     (d)  the eligible financial year beginning on 1 July 2014; or

                     (e)  the eligible financial year beginning on 1 July 2015;

a person may apply to the Authority for the issue to the person of a certificate of entitlement to coal mining assistance in respect of an eligible coal mining area for the eligible financial year.

Note:          For eligible coal mining area , see section 173R.

             (2)  An application must state that coal mining operations carried out in the eligible coal mining area are not likely to permanently cease during the eligible financial year.

             (3)  An application must specify the number of tonnes of saleable coal produced from coal mining operations carried out in the eligible coal mining area during the previous financial year.

173H   Form of application

             (1)  An application must:

                     (a)  be in writing; and

                     (b)  be in a form approved, in writing, by the Authority; and

                     (c)  be accompanied by such information as is specified in the regulations; and

                     (d)  be accompanied by such documents (if any) as are specified in the regulations; and

                     (e)  be accompanied by a prescribed report.

             (2)  The approved form of application may provide for verification by statutory declaration of statements in applications.

173J   Further information

             (1)  The Authority may, by written notice given to an applicant, require the applicant to give the Authority, within the period specified in the notice, further information in connection with the application.

             (2)  If the applicant breaches the requirement, the Authority may, by written notice given to the applicant:

                     (a)  refuse to consider the application; or

                     (b)  refuse to take any action, or any further action, in relation to the application.

173K   Issue of certificate of entitlement to coal mining assistance

Scope

             (1)  This section applies if an application under section 173G has been made for the issue of a certificate of entitlement to coal mining assistance in respect of an eligible coal mining area for an eligible financial year (the current eligible financial year ).

Issue of certificate

             (2)  The Authority must issue a certificate of entitlement to coal mining assistance in respect of the eligible coal mining area for the current eligible financial year if:

                     (a)  the applicant passes the coal mining control test in relation to the eligible coal mining area for the previous financial year; and

                     (b)  throughout the previous financial year, there was a coal mining title over the area of land; and

                     (c)  during the whole or a part of the previous financial year, coal mining operations were carried out in the whole or a part of the area of land; and

                     (d)  if:

                              (i)  during a period that is included in, or consists of, the previous financial year, coal mining operations carried out in the eligible coal mining area were a facility; and

                             (ii)  a nomination is or will be required under subsection 11B(2) or 11C(2) of the National Greenhouse and Energy Reporting Act 2007 in relation to the facility for that period;

                            such a nomination has been made.

Note:          For coal mining control test , see section 173W.

             (3)  A certificate of entitlement to coal mining assistance must state that a specified number is the unit entitlement in respect of the certificate.

Note:          See section 173L (unit entitlement).

Transitional

             (4)  If:

                     (a)  during a period that is included in, or consists of, the previous financial year, coal mining operations carried out in the eligible coal mining area were a facility; and

                     (b)  the current eligible financial year is the eligible financial year beginning on 1 July 2011;

sections 11B and 11C of the National Greenhouse and Energy Reporting Act 2007 have effect, in relation to the facility, as if:

                     (c)  those sections had commenced on 1 July 2010; and

                     (d)  the financial year beginning on 1 July 2010 had been an eligible financial year.

Note:          Sections 11B and 11C of the National Greenhouse and Energy Reporting Act 2007 deal with operational control of facilities.

Timing

             (5)  The Authority must take all reasonable steps to ensure that a decision is made on the application:

                     (a)  if the Authority requires the applicant to give further information under subsection 173J(1) in relation to the application—within 90 days after the applicant gave the Authority the information; or

                     (b)  otherwise—within 90 days after the application was made.

Refusal

             (6)  If the Authority decides to refuse to issue a certificate of entitlement to coal mining assistance, the Authority must give written notice of the decision to the applicant.

Publication of copy of certificate

             (7)  As soon as practicable after issuing a certificate of entitlement to coal mining assistance, the Authority must publish a copy of the certificate on its website.

173L   Unit entitlement

             (1)  The number to be specified in a certificate of entitlement to coal mining assistance in respect of an eligible coal mining area for an eligible financial year (the current eligible financial year ) as the unit entitlement in respect of the certificate is the number worked out using the following formula:

where:

assistance factor for the eligible coal mining area has the meaning given by subsection (2).

total base period fugitive emissions numbers means whichever is the lesser of the following:

                     (a)  the total of the base period fugitive emissions numbers specified in section 173R declarations made, or purportedly made, by the Authority before the start of the current eligible financial year;

                     (b)  16,200,000.

For the purposes of paragraph (a), disregard a section 173R declaration if a decision to make the declaration was set aside by a court or tribunal before the start of the current eligible financial year.

             (2)  For the purposes of subsection (1), the assistance factor for the eligible coal mining area is the amount worked out using the following formula:

where:

adjusted base period fugitive emissions intensity number for the eligible coal mining area means the adjusted base period fugitive emissions intensity number specified in the section 173R declaration relating to the eligible coal mining area.

relevant saleable coal number for the eligible coal mining area means whichever is the lesser of the following:

                     (a)  the capped base period saleable coal number specified in the section 173R declaration relating to the eligible coal mining area;

                     (b)  the Authority’s reasonable estimate of the total number of tonnes of saleable coal produced from coal mining operations carried out in the eligible coal mining area during the previous financial year.

total adjusted base period fugitive emissions numbers means the total of the adjusted base period fugitive emissions numbers specified in section 173R declarations made, or purportedly made, by the Authority before the start of the current eligible financial year. For this purpose, disregard a section 173R declaration if a decision to make the declaration was set aside by a court or tribunal before the start of the current eligible financial year.

             (3)  If the number worked out using the formula in subsection (1) is not a whole number, the number is to be rounded to the nearest whole number (with a number ending in .5 being rounded up).

173M   Certificate of entitlement to coal mining assistance is not transferable

                   A certificate of entitlement to coal mining assistance is not transferable.

Division 4 Eligible coal mining area

173N   Application for declaration of eligible coal mining area

                   A person may, before 1 September 2010, apply to the Authority for the declaration of an area of land as an eligible coal mining area.

173P   Form of application

             (1)  An application must:

                     (a)  be in writing; and

                     (b)  be in a form approved, in writing, by the Authority; and

                     (c)  be accompanied by such information as is specified in the regulations; and

                     (d)  be accompanied by such documents (if any) as are specified in the regulations; and

                     (e)  be accompanied by a prescribed report.

             (2)  The approved form of application may provide for verification by statutory declaration of statements in applications.

173Q   Further information

             (1)  The Authority may, by written notice given to an applicant, require the applicant to give the Authority, within the period specified in the notice, further information in connection with the application.

             (2)  If the applicant breaches the requirement, the Authority may, by written notice given to the applicant:

                     (a)  refuse to consider the application; or

                     (b)  refuse to take any action, or any further action, in relation to the application.

173R   Declaration of eligible coal mining area

Scope

             (1)  This section applies if an application under section 173N has been made for a declaration of an area of land as an eligible coal mining area.

Declaration

             (2)  After considering the application, the Authority may, by writing, declare that the area of land is an eligible coal mining area for the purposes of this Act.

             (3)  A declaration under subsection (2) must:

                     (a)  identify, in accordance with the regulations, the area of land; and

                     (b)  state that a specified number is the base period fugitive emissions number in relation to the area of land; and

                     (c)  state that a specified number is the base period saleable coal number in relation to the area of land; and

                     (d)  state that a specified number is the capped base period saleable coal number in relation to the area of land; and

                     (e)  state that a specified number is the adjusted base period fugitive emissions intensity number in relation to the area of land; and

                      (f)  state that a specified number is the adjusted base period fugitive emissions number in relation to the area of land.

Note 1:       The base period fugitive emissions number is worked out under section 173S.

Note 2:       The base period saleable coal number is worked out under section 173T.

Note 3:       The capped base period saleable coal number is worked out under section 173TA.

Note 4:       The adjusted base period fugitive emissions intensity number is worked out under section 173U.

Note 5:       The adjusted base period fugitive emissions number is worked out under section 173V.

Criteria for declaration

             (4)  The Authority must not declare that the area of land is an eligible coal mining area unless the Authority is satisfied that:

                     (a)  during the whole or a part of the 2-year period beginning on 1 July 2007, coal mining operations were carried out in the whole or a part of the area of land; and

                     (b)  the applicant passes the coal mining control test in relation to the area of land for the financial year beginning on 1 July 2008; and

                     (c)  such other conditions (if any) as are specified in the regulations are satisfied.

Note:          For coal mining control test , see section 173W.

Timing

             (5)  The Authority must take all reasonable steps to ensure that a decision is made on the application:

                     (a)  if the Authority requires the applicant to give further information under subsection 173Q(1) in relation to the application—within 90 days after the applicant gave the Authority the information; or

                     (b)  otherwise—within 90 days after the application was made.

When a declaration takes effect

             (6)  A declaration under subsection (2) takes effect immediately after it is made.

Notification of declaration

             (7)  As soon as practicable after making a declaration under subsection (2), the Authority must give a copy of the declaration to the applicant.

Publication of copy of declaration

             (8)  As soon as practicable after making a declaration under subsection (2), the Authority must publish a copy of the declaration on its website.

Refusal

             (9)  If the Authority decides to refuse to declare the area of land as an eligible coal mining area, the Authority must give written notice of the decision to the applicant.

Declaration is not legislative instrument

           (10)  A declaration made under subsection (2) is not a legislative instrument.

Division 5 Miscellaneous

173S  Base period fugitive emissions number

                   For the purposes of this Act, the base period fugitive emissions number in relation to an area of land is the Authority’s reasonable estimate of the total number of tonnes of the carbon dioxide equivalence of fugitive emissions emitted from coal mining operations carried out in the area of land during the financial year beginning on 1 July 2008, calculated using the method ascertained in accordance with the regulations.

173T   Base period saleable coal number

For the purposes of this Act, the base period saleable coal number in relation to an area of land is the Authority’s reasonable estimate of the total number of tonnes of saleable coal produced from coal mining operations carried out in the area of land during the financial year beginning on 1 July 2008.

173TA   Capped base period saleable coal number

For the purposes of this Act, the capped base period saleable coal number in relation to an area of land is whichever is the greater of the following:

                     (a)  the Authority’s reasonable estimate of the total number of tonnes of saleable coal produced from coal mining operations carried out in the area of land during the financial year beginning on 1 July 2007;

                     (b)  the Authority’s reasonable estimate of the total number of tonnes of saleable coal produced from coal mining operations carried out in the area of land during the financial year beginning on 1 July 2008.

173U   Adjusted base period fugitive emissions intensity number

                   For the purposes of this Act, the adjusted base period fugitive emissions intensity number in relation to an area of land is the number worked out to 3 decimal places (rounding up if the 4th decimal place is 5 or more) using the following formula:

Note 1:       The base period fugitive emissions number is worked out under section 173S.

Note 2:       The base period saleable coal number is worked out under section 173T.

173V   Adjusted base period fugitive emissions number

             (1)  For the purposes of this Act, the adjusted base period fugitive emissions number in relation to an area of land is the number worked out using the following formula:

Note 1:       The adjusted base period fugitive emissions intensity number is worked out under section 173U.

Note 2:       The capped base period saleable coal number is worked out under section 173TA.

             (2)  If the number worked out using the formula in subsection (1) is not a whole number, the number is to be rounded to the nearest whole number (with a number ending in .5 being rounded up).

173W   Coal mining control test

                   For the purposes of this Act, a person passes the coal mining control test in relation to an area of land for a financial year if:

                     (a)  if, assuming that:

                              (i)  at the last time in the financial year when coal mining operations were carried out in the area of land, those coal mining operations had been a facility; and

                             (ii)  at the last time in the financial year when coal mining operations were carried out in the area of land, greenhouse gases with a carbon dioxide equivalence of 25,000 tonnes had been emitted from those coal mining operations; and

                            (iii)  the financial year had been an eligible financial year;

                            a controlling corporation of a group would, under section 17, be a liable entity for the financial year wholly or partly as a result of those emissions of greenhouse gases—the person is the controlling corporation; or

                     (b)  if, assuming that:

                              (i)  at the last time in the financial year when coal mining operations were carried out in the area of land, those coal mining operations had been a facility; and

                             (ii)  at the last time in the financial year when coal mining operations were carried out in the area of land, greenhouse gases with a carbon dioxide equivalence of 25,000 tonnes had been emitted from those coal mining operations; and

                            (iii)  the financial year had been an eligible financial year;

                            a non-group entity would, under section 18, be a liable entity for the financial year wholly or partly as a result of those emissions of greenhouse gases—the person is the non-group entity; or

                     (c)  if, assuming that:

                              (i)  at the last time in the financial year when coal mining operations were carried out in the area of land, those coal mining operations had been a facility; and

                             (ii)  at the last time in the financial year when coal mining operations were carried out in the area of land, greenhouse gases with a carbon dioxide equivalence of 25,000 tonnes had been emitted from those coal mining operations; and

                            (iii)  the financial year had been an eligible financial year;

                            the holder of a liability transfer certificate would, under section 19, be a liable entity for the financial year wholly or partly as a result of those emissions of greenhouse gases—the person is the holder of the liability transfer certificate.

173X   Submerged land

                   For the purposes of this Part, land includes submerged land.

[coal mining]

(19)   Clause 273, page 357 (after line 17), after subclause (1), insert:

Coal mining

          (1A)  As soon as practicable after free Australian emissions units are issued to a person in accordance with Part 8A (coal mining), the Authority must publish on its website:

                     (a)  the name of the person; and

                     (b)  the total number of free Australian emissions units issued to the person; and

                     (c)  the vintage year of the free Australian emissions units issued to the person.

[coal mining]

(20)   Clause 274, page 358 (after line 19), after paragraph (a), insert:

                    (aa)  the total number of free Australian emissions units with a particular vintage year issued during the quarter in accordance with Part 8A (coal mining);

[coal mining]

(21)   Clause 346, page 430, after table item 27, insert:

27A

A decision to refuse to issue a certificate of entitlement to coal mining assistance under section 173K.

27B

A decision under subsection 173K(4) to state that a specified number is the unit entitlement in respect of a certificate of entitlement to coal mining assistance.

27C

A decision to refuse to make a declaration under section 173R.

27D

A decision under subsection 173R(3) to state that a specified number is the base period fugitive emissions number in relation to an area of land.

27E

A decision under subsection 173R(3) to state that a specified number is the base period saleable coal number in relation to an area of land.

27F

A decision under subsection 173R(3) to state that a specified number is the capped base period saleable coal number in relation to an area of land.

27G

A decision under subsection 173R(3) to state that a specified number is the adjusted base period fugitive emissions intensity number in relation to an area of land.

27H

A decision under subsection 173R(3) to state that a specified number is the adjusted base period fugitive emissions number in relation to an area of land.

[coal mining]

(22)   Clause 382, page 460 (after line 5), after subclause (7), insert:

Coal mining

          (7A)  This Act and the associated provisions also have the effect they would have if this Act provided that a person is not entitled to make an application under section 173G or 173N unless the person is:

                     (a)  a constitutional corporation; or

                     (b)  the Commonwealth; or

                     (c)  an authority of the Commonwealth.

[coal mining]

(23)   Clause 386, page 462 (after line 22), at the end of the clause, add:

             (3)  However, to the extent to which the definition is relevant to the interpretation of Part 8A (coal mining) of this Act, the definition has effect as if:

                     (a)  the National Greenhouse and Energy Reporting Act 2007 had commenced on 1 July 2007; and

                     (b)  the amendments of that Act made by Part 2 of Schedule 1 to the Carbon Pollution Reduction Scheme (Consequential Amendments) Act 2009 had commenced immediately after the start of 1 July 2007.

[coal mining]