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Carbon Pollution Reduction Scheme Bill 2009

Part 2 National scheme cap and national scheme gateway

   

13  Simplified outline

                   The following is a simplified outline of this Part:

•      The regulations may declare that a quantity of greenhouse gas that has a carbon dioxide equivalence of a specified number of tonnes is the national scheme cap for a financial year.

•      For the financial year beginning on 1 July 2015 or a later financial year, the national scheme cap must fall within the upper and lower bound of the national scheme gateway (if any) declared by the regulations for the financial year.

Note:          The national scheme cap limits:

(a)    the total number of auctioned Australian emissions units; and

(b)    the total number of free Australian emissions units issued in accordance with the emissions-intensive trade-exposed assistance program; and

(c)    the total number of free Australian emissions units issued in accordance with Part 9 (coal-fired electricity generation).

14   National scheme cap

National scheme cap

             (1)  The regulations may declare that:

                     (a)  a quantity of greenhouse gas that has a carbon dioxide equivalence of a specified number of tonnes is the national scheme cap for a specified eligible financial year (other than the eligible financial year starting on 1 July 2011); and

                     (b)  that number is the national scheme cap number for that eligible financial year.

             (2)  The Minister must take all reasonable steps to ensure that:

                     (a)  regulations declaring the national scheme cap number for the eligible financial year beginning on 1 July 2012; and

                     (b)  regulations declaring the national scheme cap number for each of the next 2 eligible financial years;

are made before 1 July 2010.

             (3)  The Minister must take all reasonable steps to ensure that:

                     (a)  regulations declaring the national scheme cap number for the eligible financial year beginning on 1 July 2015 are made at least 5 years before the end of the eligible financial year; and

                     (b)  regulations declaring the national scheme cap number for a later eligible financial year are made at least 5 years before the end of the later eligible financial year.

             (4)  If:

                     (a)  apart from this subsection, at the beginning of the 5-year period ending at the end of an eligible financial year (the current eligible financial year ), there is no national scheme cap number for the current eligible financial year; and

                     (b)  there was a national scheme cap number for the previous eligible financial year; and

                     (c)  the current eligible financial year began on or after 1 July 2015;

the national scheme cap number for the current eligible financial year is equal to:

                     (d)  if 99% of the national scheme cap number for the previous eligible financial year is less than the lower bound of the national scheme gateway for the current eligible financial year—that lower bound; or

                     (e)  if 99% of the national scheme cap number for the previous eligible financial year exceeds the upper bound of the national scheme gateway for the current eligible financial year—that upper bound; or

                      (f)  if neither paragraph (d) nor (e) applies—99% of the national scheme cap number for the previous eligible financial year (rounded to the nearest whole number, with a number ending in .5 being rounded up).

Regulations

             (5)  In making a recommendation to the Governor-General about regulations to be made for the purposes of this section, the Minister:

                     (a)  must have regard to Australia’s international obligations under:

                              (i)  the Climate Change Convention; and

                             (ii)  the Kyoto Protocol; and

                     (b)  may have regard to the most recent report given to the Minister by an expert advisory committee under section 354, to the extent to which that report deals with national scheme caps; and

                     (c)  may have regard to the following matters:

                              (i)  the principle that the stabilisation of atmospheric concentrations of greenhouse gases at around 450 parts per million of carbon dioxide equivalence or lower is in Australia’s national interest;

                             (ii)  progress towards, and development of, comprehensive global action under which all of the major economies commit to substantially restrain greenhouse gas emissions and all of the advanced economies commit to reductions of greenhouse gas emissions comparable to the reductions to which Australia has committed;

                            (iii)  the economic implications associated with various levels of national scheme caps, including implications of the carbon price;

                            (iv)  voluntary action to reduce Australia’s greenhouse gas emissions;

                             (v)  estimates of greenhouse gas emissions that are not covered (directly or indirectly) by the carbon pollution reduction scheme;

                            (vi)  such other matters (if any) as the Minister considers relevant.

             (6)  Paragraph (5)(b) does not apply if no report has been given to the Minister under section 354.

             (7)  If:

                     (a)  regulations are made for the purposes of this section; and

                     (b)  on a particular day (the tabling day ), a copy of the regulations is tabled before a House of the Parliament under section 38 of the Legislative Instruments Act 2003 ;

then, on or as soon as practicable after the tabling day, the Minister must cause to be tabled before that House a written statement setting out the Minister’s reasons for making the recommendation to the Governor-General about those regulations.

15   National scheme gateway

Scope

             (1)  This section applies to:

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

                     (b)  each later eligible financial year.

Gateway

             (2)  The regulations may declare that:

                     (a)  a quantity of greenhouse gas that has a carbon dioxide equivalence of a specified number of tonnes is the upper bound of the national scheme gateway for a specified eligible financial year; and

                     (b)  a quantity of greenhouse gas that has a carbon dioxide equivalence of a specified number of tonnes is the lower bound of the national scheme gateway for a specified eligible financial year.

National scheme cap

             (3)  The Minister must take all reasonable steps to ensure that the national scheme cap for an eligible financial year:

                     (a)  is not more than the upper bound of the national scheme gateway (if any) for the eligible financial year; and

                     (b)  is not less than the lower bound of the national scheme gateway (if any) for the eligible financial year.

Regulations

             (4)  In making a recommendation to the Governor-General about regulations to be made for the purposes of this section, the Minister:

                     (a)  must have regard to Australia’s international obligations under:

                              (i)  the Climate Change Convention; and

                             (ii)  the Kyoto Protocol; and

                     (b)  may have regard to the most recent report given to the Minister by an expert advisory committee under section 354, to the extent to which that report deals with national scheme gateways; and

                     (c)  may have regard to the following matters:

                              (i)  the principle that the stabilisation of atmospheric concentrations of greenhouse gases at around 450 parts per million of carbon dioxide equivalence or lower is in Australia’s national interest;

                             (ii)  progress towards, and development of, comprehensive global action under which all of the major economies commit to substantially restrain greenhouse gas emissions and all of the advanced economies commit to reductions of greenhouse gas emissions comparable to the reductions to which Australia has committed;

                            (iii)  the economic implications associated with various national scheme gateways, including implications of the carbon price;

                            (iv)  voluntary action to reduce Australia’s greenhouse gas emissions;

                             (v)  estimates of greenhouse gas emissions that are not covered (directly or indirectly) by the carbon pollution reduction scheme;

                            (vi)  such other matters (if any) as the Minister considers relevant.

             (5)  Paragraph (4)(b) does not apply if no report has been given to the Minister under section 354.

             (6)  If:

                     (a)  regulations are made for the purposes of this section; and

                     (b)  on a particular day (the tabling day ), a copy of the regulations is tabled before a House of the Parliament under section 38 of the Legislative Instruments Act 2003 ;

then, on or as soon as practicable after the tabling day, the Minister must cause to be tabled before that House a written statement setting out the Minister’s reasons for making the recommendation to the Governor-General about those regulations.