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Climate Change (Consequential Amendments) Bill 2022

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2022

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

SENATE

 

 

CLIMATE CHANGE (CONSEQUENTIAL AMENDMENTS) BILL 2022

 

 

 

REVISED EXPLANATORY MEMORANDUM

 

 

 

(Circulated by authority of the Minister for Climate Change and Energy,

the Honourable Chris Bowen MP)

 

 

 

 

 

 

 

 

 

 

 

THIS MEMORANDUM TAKES ACCOUNT OF AMENDMENTS MADE BY THE HOUSE OF REPRESENTATIVES TO THE BILL AS INTRODUCED







GLOSSARY

 

Abbreviation

Definition

ARENA

Australian Renewable Energy Agency

Authority

Climate Change Authority

CEFC

Clean Energy Finance Corporation

CSIRO

Commonwealth Scientific and Industrial Research Organisation

main Bill

Climate Change Bill 2022

this Bill or Consequential Amendments Bill

Climate Change (Consequential Amendments) Bill 2022

DCCEEW or Department

Department of Climate Change, Energy, the Environment and Water

IPCC

Intergovernmental Panel on Climate Change

NDC or nationally determined contribution

Australia’s Nationally Determined Contribution under Article 4 of the Paris Agreement

Paris Agreement

The Paris Agreement, done at Paris on 12 December 2015, as amended and in force for Australia from time to time. The Paris Agreement may be found in Australian Treaty Series 2016 No. 24 ([2016] ATS 24)

UN

United Nations

UNFCCC

United Nations Framework Convention on Climate Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

CLIMATE CHANGE (CONSEQUENTIAL AMENDMENTS) BILL 2022

 

OUTLINE

The Climate Change (Consequential Amendments) Bill 2022 makes consequential amendments to existing federal legislation in order to support the effective implementation of the Climate Change Bill 2022. It embeds consideration of Australia’s greenhouse gas emissions reduction targets and the Paris Agreement into the objects and functions of a range of Commonwealth entities and schemes, helping ensure those entities and schemes are able to contribute to the delivery of those targets. Some entities, such as those with a research and commercialisation focus, also have a role providing a foundation for Australia to achieve new or adjusted targets over time.

The Climate Change Bill enshrines Australia’s greenhouse gas emissions reduction targets into domestic law - with those targets being a 43% reduction against 2005 levels by 2030 and net zero by 2050. The Climate Change Bill also ensures transparency and accountability with respect to Australia’s greenhouse gas emissions reduction targets, by requiring the Minister to table an annual climate change statement in Parliament, setting out Australia’s progress towards meeting its emissions reduction targets, relevant international developments, climate change policy, and the effectiveness and impact of Commonwealth measures. The Climate Change Bill further requires the Climate Change Authority (the Authority) to provide advice to the Minister that relates to the annual statement, as well as, at least once every 5 years, on the greenhouse gas emission reduction targets the Authority considers should be included in any new Nationally Determined Contribution (NDC) to be submitted under the Paris Agreement. The Authority must also advise the Minister if requested on the greenhouse gas emission reduction targets the Authority considers should be included in an updated NDC.  

The purpose of the Bill is to embed considerations relating to the emissions reduction targets and the Paris Agreement into relevant federal legislation for Commonwealth entities and schemes, and Commonwealth government departments delivering programs and implementing policies that are, or could be, contributing to emissions reductions for Australia - enabling the delivery of real and significant emissions reduction and representing a step towards achieving the transition to net zero that is vital to the future of Australia.

The greenhouse gas emissions reduction targets referred to in this Bill are both the legislated targets in the Climate Change Bill and also any targets included in new or adjusted NDCs under the Paris Agreement. This is essential to ensure that the Commonwealth legislation to be amended is implementing Australia’s international obligations under the Paris Agreement as in force from time to time. This also reflects the support from the external affairs power for many of the provisions or schemes being amended. Australia’s NDC under the Paris Agreement, and any subsequent adjustments, are freely available at: https://unfccc.int/NDCREG

The amendments set out in the Bill are not intended to limit or constrain the exercise of powers or performance of the existing functions of the relevant entities and schemes. Rather, they are intended to enhance the legislation to ensure consideration of Australia’s emissions reduction targets and Australia’s obligations under the Paris Agreement, alongside other relevant considerations, when exercising powers or performing functions. In several instances, the amendments made by the Bill are simply to incorporate additional matters into the objects of an Act or the functions of a body established by an Act. While many organisations are already considering climate change in their general decision making, the amendments will mean that Australia’s emissions reduction targets are explicitly identified as a consideration to inform decision-making under those Acts or by those bodies generally, rather than incorporating additional requirements into particular functions or powers.

The legislation being amended by the Bill are not the only areas where the targets and Paris Agreement are relevant. For example, the Product Emissions Standards Act 2017 already references the Paris Agreement and the Recycling and Waste Reduction Act 2020 includes an object related to reducing greenhouse gas emissions. The Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 is proposed to be separately amended by a bill which will implement a number of reforms to that Act.

The Bill does not impose any additional requirements for Commonwealth procurement processes. The Commonwealth Procurement Rules under the Public Governance, Performance and Accountability Act 2013 , which commenced on 1 July 2022, already incorporate environmental sustainability and climate change impacts in assessing value for money. Low emissions technologies and emissions reduction are already a key feature of investment mandates of a range of Commonwealth investment agencies, such as the Clean Energy Finance Corporation. The Commonwealth government will look to include relevant considerations in other investment mandates or statements of expectations issued to relevant Commonwealth entities and schemes as appropriate. The government will also continue to review other existing and new Commonwealth legislation to identify further opportunities to include appropriate references to the targets and Paris Agreement. This Bill has focused on those schemes and entities with the greatest connection to activities that contribute to the targets. The annual climate change statements under the Climate Change Bill will provide an opportunity to update Parliament on progress that has been made on these issues.

 

FINANCIAL IMPACT STATEMENT

There is no financial impact associated with this Bill.

 

CONSULTATION

The 2050 greenhouse gas emissions reduction target was developed by the previous government, including through consultation and modelling that informed the development of the Long-Term Emissions Reduction Plan released in October 2021. The government, while in opposition, engaged with key stakeholders and the Australian community to develop the Powering Australia plan and 2030 greenhouse gas emissions reduction target it took to the election. Comprehensive modelling was released with the Powering Australia plan to outline the impacts of policies to achieve the targets. A broad set of industry and community groups were present to witness the signing of Australia’s updated NDC on 16 June 2022.

The content of the Climate Change Bill, and the intention for accompanying consequential amendments to insert emissions reduction targets in the objectives and functions of a range of government agencies, was announced at the National Press Club on 29 June 2022.

ARENA, the Clean Energy Regulator, the CEFC, the Climate Change Authority, and the CSIRO were consulted in relation to this Bill. The Department of Foreign Affairs and Trade, the Department of Infrastructure, Transport, Regional Development, Communications and the Arts, and the Department of Finance were consulted in relation to changes to legislation for which they are responsible, relating to Export Finance Australia, Infrastructure Australia, and the Northern Australia Infrastructure Facility. The government briefed a range of key stakeholder groups and interested cross bench members of Parliament on the proposed contents before introduction.

STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

 

Climate Change Bill (Consequential Amendments) Bill 2022

This Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 .

 

Overview of the Climate Change (Consequential Amendments) Bill 2022

This Bill will make consequential amendments to include reference to Australia’s greenhouse gas emissions reduction targets and/or the Paris Agreement in the following legislation:

Australian Renewable Energy Agency Act 2011

Building Energy Efficiency Disclosure Act 2010

Carbon Credits (Carbon Farming Initiative) Act 2011

Clean Energy Finance Corporation Act 2012

Clean Energy Regulator Act 2011

Climate Change Authority Act 2011

Export Finance and Insurance Corporation Act 1991

Greenhouse and Energy Minimum Standards Act 2007

Infrastructure Australia Act 2008

National Greenhouse and Energy Reporting Act 2012

Northern Australia Infrastructure Facility Act 2016

Offshore Electricity Infrastructure Act 2021

Renewable Energy (Electricity) Act 2000

Science and Industry Research Act 1949

These amendments are not intended to limit the exercise of powers or performance of functions of these entities and schemes. Rather, they are intended to enhance the legislation to enable consideration of Australia’s emissions reduction targets and its obligations under the Paris Agreement when exercising powers or performance of functions.

Human rights implications

The Australian Government recognises that climate change can impact upon the enjoyment of human rights. This Bill is consistent with the relevant human rights set out in those treaties to which Australia is a party.

Conclusion

This Bill is compatible with human rights because it promotes the protection of human rights.



CLIMATE CHANGE (CONSEQUENTIAL AMENDMENTS) BILL 2022

NOTES ON CLAUSES

 

Clause 1: Short title

 

1.                   This clause provides for the Bill, when enacted, to be cited as the Climate Change (Consequential Amendments) Act 2022 .

Clause 2: Commencement

 

2.                   This clause provides that the Bill commences on the later of the day after the Royal Assent and the commencement of the Climate Change Act 2022 - but will not commence if the Climate Change Act 2022 is not enacted.

Clause 3: Schedules

 

3.                   This clause provides that each Act specified in a Schedule to the Bill will be amended or repealed as set out in the Schedules. This clause also provides that each of other item in a Schedule to the Bill is to have effect according to its terms.

 

SCHEDULE 1 -AMENDMENTS

 

4.                   There are a number of terms common to many of these amendments and they are defined in items 2, 5, 8, 11, 17, 20, 24, 26, 32, 36, 40, 45, 46, 49, 55 and 56 to be interpreted consistently across each of the Acts being amended.

 

5.                   The Paris Agreement is defined as the agreement done in Paris on 12 December 2015 and any subsequent amendments that are in force for Australia from time to time. Background information and the text of the agreement are freely available from: https://unfccc.int/process-and-meetings/the-paris-agreement/the-paris-agreement

 

6.                   Australia’s greenhouse gas emissions reduction targets are defined to include the legislated 2030 and 2050 targets in main Bill as well as any new or adjusted nationally determined contributions submitted by Australia under the Paris Agreement. For example, Australia is required to submit a nationally determined contribution which includes a 2035 target by 2025 and this target would be a relevant target referenced by the amendments in this Schedule. The Paris Agreement is designed so that Parties’ successive nationally determined contributions are a progression over time and any adjustments are with a view to enhancing the level of ambition in those contributions. It is therefore important that any such new or adjusted nationally determined contributions are in accordance with those rules in Article 4 of the Paris Agreement. Australia’s nationally determined contribution, and any subsequent adjustments or new contributions, is freely available at: https://unfccc.int/NDCREG

 

7.                   The definition of Australia’s greenhouse gas emissions reduction targets includes both the targets set by the main Bill, and other targets that may be set from time to time through nationally determined contributions. This will mean that relevant agencies consider the most up-to-date targets when giving effect to the objects and functions inserted or amended by this Bill.

 

Part 1 - Amendments

 

Australian Renewable Energy Agency Act 2011

 

8.                   The Australian Renewable Energy Agency Act 2011 (the ARENA Act) establishes the Australian Renewable Energy Agency (ARENA), determines its financial assistance functions and has the objectives of improving the competitiveness of renewable energy technologies and increasing the supply of renewable energy in Australia. Since 2012, ARENA has supported over 600 projects with more than $1.86 billion committed in grant funding, unlocking a total investment of over $8 billion in Australia’s renewable energy industry.

 

9.                   ARENA’s deep understanding of the renewable energy sector and willingness to fund innovative and ground-breaking projects allow them to provide a pathway to commercialisation for many new technologies and businesses that would otherwise struggle to get off the ground or be potentially lost to overseas markets.

 

Item 1 - Section 3

 

10.          This item inserts an additional object, to ‘facilitate the achievement of Australia’s greenhouse gas emissions reduction targets’ into section 3 of the ARENA Act, which sets out the objects of the Act. This recognises the important role ARENA plays through its functions, including research into renewable energy technologies and the development, demonstration, commercialisation or deployment of renewable energy technologies, related and enabling technologies and energy efficiency technologies in reducing emissions to deliver on the targets. ARENA’s innovation support and commercialisation functions have a particular role in supporting Australia’s net zero by 2050 target, by making it increasingly feasible for Australia to deliver greater emissions reductions in the period to 2050. The transformation of the electricity sector is already well underway and the support already provided by ARENA has been a significant part of this progress.

 



 

Item 2 - Section 4

 

11.          This item inserts definitions of ‘Australia’s greenhouse gas emissions reduction targets’, ‘constitutional corporation’ and ‘Paris Agreement’ into section 4, which sets out Definitions for the ARENA Act.

 

Item 3 - Section 14

  

12.          This item updates the constitutional basis for the ARENA Act, to make the external affairs power the primary head of power for the Act and with respect to that power to add a reference to giving effect to the Paris Agreement.

 

13.          This item also updates the earlier reference to a ‘corporation to which paragraph 51(xx) of the Constitution applies’ to incorporate a defined term, ‘constitutional corporation’ and capture how the relevant financial assistance will be relevant to the trading or financial activities of that corporation. The drafting of the constitutional limitation provision has been made more robust and consistent with more recent Commonwealth legislation. The new drafting is not intended to have any material impact on the activities or entities ARENA is currently supporting.

 

Building Energy Efficiency Disclosure Act 2010

 

14.          The Building Energy Efficiency Disclosure Act 2010 (the BEED Act) provides for the establishment of a national scheme for the disclosure of building energy efficiency. The BEED Act does not have an objects clause, but does have a long title which states a purpose ‘to promote the disclosure of information about energy efficiency of buildings, and for related purposes’.

 

15.          The BEED Act contributes to Australia’s emissions reduction by making energy efficiency information accessible to potential purchasers and lessees via a Register, empowering the market with information to encourage energy efficiency improvements. Energy efficiency is a key part of the transition to net zero and meeting emissions reduction targets, through reducing demand. These amendments make explicit the contribution that building energy efficiency measures can make towards achieving Australia’s greenhouse gas emissions reduction targets, and embeds those considerations in the objects of the Act.  

 

Item 4 - After section 2

 

16.          This item inserts a new objects clause into the BEED Act (section 2A), with the objects being twofold: to promote the disclosure of information about the energy efficiency of buildings and to contribute to achieving Australia’s greenhouse gas emissions reduction targets. While no specific obligations are imposed as a result of this amendment, the amendment will mean that decision making under the Act will be informed by consideration of contributing to achieving Australia’s greenhouse gas emissions reduction targets.

 

Item 5 - Section 3

 

17.          This item inserts definitions of ‘Australia’s greenhouse gas emissions reduction targets’ and ‘Paris Agreement’ into section 3, which sets out definitions of words and expressions used in the BEED Act.

 

Carbon Credits (Carbon Farming Initiative) Act 2011

 

18.          The Carbon Credits (Carbon Farming Initiative) Act 2011 (the CFI Act) establishes the crediting framework originally enacted as the Carbon Farming Initiative and now known as the Emissions Reduction Fund, for the issuance of Australian carbon credit units for projects that avoid emissions of greenhouse gases or store carbon in vegetation or soils.

 

19.          The objects of the CFI Act include to remove greenhouse gases from the atmosphere, and to avoid emissions of greenhouse gases, to create incentives for people to undertake carbon offset projects, to increase carbon abatement, and to authorise the purchase by the Commonwealth of units that represent carbon abatement.

 

20.          The amendments would add a fifth object ‘to facilitate the achievement of Australia’s greenhouse gas emissions reduction targets’ and to include reference to the Paris Agreement. The references to the Paris Agreement in the concept of eligible carbon abatement ensures that the credited abatement under the CFI Act counts towards the Australia’s greenhouse gas emissions reduction targets and Australia’s nationally determined contributions under the Paris Agreement. This additional object will also explicitly recognise the significant contribution of the Emissions Reduction Fund to the achievement of those targets.

 

Item 6 - Paragraph 3(2)(c)

 

21.          This item amends the first object set out in the CFI Act, which is to remove greenhouse gases from the atmosphere and avoid emissions of greenhouse gases in order to meet Australia’s obligations under nominated international agreements. The item removes the reference to an international agreement that is the successor to the Kyoto Protocol, and substitutes in its stead a reference to the Paris Agreement and any other international agreement - enabling the object to extend to removals or avoidance of greenhouse gases in order to meet Australia’s obligations under the Paris Agreement and not precluding any other international agreement where such abatement may be relevant.

 

 

 

Item 7 - At the end of section 3

 

22.          Section 3 of the CFI Act sets out the objects of that Act. This item inserts a new, fifth object for the CFI Act ¾ to facilitate the achievement of Australia’s emissions reduction targets. This recognises the central role that credits under the CFI Act play in a range of emissions reduction policies.

 

Item 8 - Section 5

 

23.          This item inserts a definition of ‘Australia’s greenhouse gas emissions reduction targets’ into section 5, which sets out Definitions for the Act.

 

Item 9 - Section 5 (subparagraph (b)(ii) of the definition of eligible carbon abatement )

 

24.          This item removes the reference to an international agreement that is the successor to the Kyoto Protocol, and substitutes in its stead a reference to the Paris Agreement. It is important that the credited abatement counts towards these targets - that is, targets under the Kyoto Protocol or Paris Agreement.

 

Item 10 - Section 5 (definition of eligible carbon abatement )

 

25.          This item removes the reference to whether or not the Doha Amendment is in force for Australia from the definition of ‘eligible carbon abatement’. The Doha Amendment has commenced and is in force for Australia. This amendment helps the clarity of the new definition which focuses on the Paris Agreement and avoids unnecessary confusion.

 

Item 11 - Section 5

 

26.          This item inserts a definition of ‘Paris Agreement’ into section 5, which sets out Definitions for the Act.

 

Item 12 - Section 5 (paragraph (d) of the definition of prescribed eligible carbon unit )

 

27.          The item removes the reference to an international agreement that is the successor to the Kyoto Protocol, and substitutes in its stead a reference to the Paris Agreement or any other international agreement. No units are currently prescribed for the purpose of this definition.

 

Item 13 - Section 5 (paragraph (d) of the definition of prescribed eligible carbon unit )

 

28.          This item removes the reference to whether or not the Doha Amendment is in force for Australia from the definition of ‘prescribed eligible carbon unit’. The Doha Amendment has commenced and is in force for Australia. This amendment helps the clarity of the new definition which includes the Paris Agreement and avoids unnecessary confusion.

 

Item 14 - Subparagraph 273(d)(iii)

 

29.          This item removes the reference to an international agreement that is the successor to the Kyoto Protocol, and substitutes in its stead a reference to the Paris Agreement or any other international agreement relating to climate change, for the purposes of disclosing protected information under the section.

 

Item 15 - Paragraph 273(e)

 

30.          The item removes the reference to an international agreement that is the successor to the Kyoto Protocol, and substitutes in its stead a reference to an international agreement relating to climate change.

 

Clean Energy Finance Corporation Act 2012

 

31.          The Clean Energy Finance Corporation Act 2012 (the CEFC Act) establishes the independent Clean Energy Finance Corporation (CEFC), which has the unique role of investing $10 billion in clean energy technologies to facilitate increased flows of finance into the clean energy sector in Australia. The CEFC is also supporting the growth of a clean and competitive hydrogen industry in Australia through the Advancing Hydrogen Fund. The CEFC, as a result of its strategic investments, has already played a significant role in financing clean energy technologies which are essential to the achievement of Australia’s emissions reduction targets.

 

Item 16 - At the end of section 3

 

32.          Section 3, the objects clause of the CEFC Act, currently provides that the object of the Act is to ‘facilitate increased flows of finance into the clean energy sector’. This item inserts an additional object into the objects clause of the Act, being ‘to facilitate the achievement of Australia’s greenhouse gas emissions reduction targets’.

 

Item 17 - Section 4

 

33.          This item inserts definitions of ‘Australia’s greenhouse gas emissions reduction targets’, ‘constitutional corporation’ and ‘Paris Agreement’ into section 4, which sets out Definitions for the CEFC Act.

 

Item 18 - Section 10

 

34.          This item updates the constitutional basis for the CEFC Act, by making the external affairs power the primary head of power, and within that power add a reference to giving effect to the Paris Agreement. The drafting of the constitutional limitation provision has been made more robust and consistent with more recent Commonwealth legislation. The new drafting is not intended to have any material impact on the activities or entities CEFC is currently supporting.

 

Clean Energy Regulator Act 2011

 

35.          The Clean Energy Regulator Act 2011 (the CER Act) establishes the Clean Energy Regulator, and sets out the functions of the Clean Energy Regulator under climate change laws and other legislation that contributes to reduced carbon emissions and increased use of clean energy.

 

36.          The amendments would allow the Regulator to have functions conferred by regulations that contribute to the achievement of Australia’s greenhouse gas emissions reduction targets. This would assist with the Guarantee of Origin work currently underway and the Regulator’s Corporate Emissions Reduction Transparency Report. Any such regulations would be subject to usual disallowance and scrutiny requirements in the Legislation Act 2003 .

 

Item 19 - At the end of section 3

 

37.          This item would update the simplified outline to acknowledge that the Clean Energy Regulator may have functions conferred on it by regulations.

 

Item 20 - Section 4

 

38.          This item inserts definitions of ‘Australia’s greenhouse gas emissions reduction targets’ and ‘Paris Agreement’ into section 4, which sets out Definitions for the CER Act.

 

Item 21 - After paragraph 12(b)

 

39.          This item would allow the Clean Energy Regulator to have functions conferred on it by regulations. This will allow for the conferral of functions on the Clean Energy Regulator that contribute to the achievement of Australia’s greenhouse gas emissions reduction targets. The functions could relate to programs such as developing a Guarantee of Origin scheme for products such as hydrogen and the publication of the Regulator’s Corporate Emissions Reduction Transparency Report.

 

40.          It is not currently possible to identify with precision the further functions of the Clean Energy Regulator that might be necessary or appropriate to achieve Australia’s emissions reduction targets in future. This item would therefore allow additional functions to be added for that purpose, but would not allow additional functions to be conferred generally. The ability to expand the Clean Energy Regulator’s remit by regulation is therefore proportionate and appropriate. The regulation making power does not extend to conferring additional enforcement powers or imposing requirements on third parties relating to such functions. The functions would generally be expected to reduce net greenhouse gas emissions in Australia, contributing to both the 2030 and 2050 targets and would not be limited by the 43% reduction by 2030.

 

Item 22 - After subsection 41(3)

 

41.          The CER Act already provides that any ministerial directions to the Regulator cannot be inconsistent with relevant Acts (at subsection 41(3)). This item ensures that ministerial directions should also not be inconsistent with the achievement of Australia’s greenhouse gas emissions reduction targets. This furthers the independence of the Regulator and ensures Ministerial directions cannot be used to undermine the achievement of Australia’s greenhouse gas emissions reduction targets or schemes administered by the Regulator.

 

Climate Change Authority Act 2011

 

42.          The Climate Change Authority Act 2011 (the CCA Act) establishes the Climate Change Authority, and sets out the functions of the Climate Change Authority which include the performance of statutory reviews, conducting research, advising the Minister, and any other functions set out in the Act or in another law of the Commonwealth.  The Climate Change Authority will also have a key advisory role conferred on it by the main Bill, which will include the responsibility to advise the Minister in relation the Minister’s annual climate change statement and on the setting of any new or updated greenhouse gas emissions reduction targets in a Nationally Determined Contribution. Several of the changes to the CCA Act made by this Bill are to reflect that the Clean Energy Act 2011 (the CEA Act) was repealed by the previous government. This includes updating references for the Climate Change Authority to give advice under the main Bill, rather than under the CEA Act.

 

Item 23 - Section 3

 

43.          This item removes reference to the Authority conducting reviews under the CCA Act and adds that ‘The Authority is to give advice under the Climate Change Act 2022 ’. This reflects the new functions to be conferred by the main Bill.

 

Item 24 - Section 4

 

44.          This item inserts a definition of ‘Australia’s greenhouse gas emissions reduction targets’ into section 4, which sets out Definitions for the CCA Act.

 

Item 25 - Section 4 (definition of Climate Change Minister )

 

45.          This item removes reference to ‘the Clean Energy Act 2011’ in the definition of ‘Climate Change Minister’ and substitutes it to ‘this Act’, in section 4 which sets out Definitions for the CCA Act.

 

Item 26 - Section 4

 

46.          This items inserts a definition of ‘Paris Agreement’ into section 4, which sets out Definitions for the CCA Act.

 

Item 27 - Subparagraph 11(a)(i)

 

47.          This item repeals the subparagraph as the CEA Act was repealed by the previous government.

 

Item 28 - After paragraph 11(b)

 

48.          This item inserts a subparagraph under paragraph 11(b), which sets out the functions of the Climate Change Authority, to give advice under Part 4 of the main Bill.

 

Item 29 - Paragraph 12(a)

 

49.               In performing its functions, the Authority must have regard to the principle that any measures to respond to climate change should have certain specified characteristics, such as be economically efficient and be environmentally effective. This item adds to the list of characteristics: that any measures to respond to climate change should take account of the matters set out in Article 2 of the Paris Agreement; and should boost economic, employment and social benefits including for rural and regional Australia.

 

50.               T he matters set out in Article 2 of the Paris Agreement include the global temperature goals, which are to hold the increase in the global average temperature to well below 2°C above pre-industrial levels, and pursuing efforts to limit the temperature increase to 1.5°C above pre-industrial levels, and which are also reflected in the objects of the main Bill. This helps emphasise the importance of climate science for the Climate Change Authority’s work, including in advising on relevant targets.

 

51.               The concept that measures to respond to climate change should boost economic, employment and social benefits, including for rural and regional Australia, reflects that climate action presents great opportunities for Australia which should be maximised and taken advantage of. This amendment would ensure the Authority has regard to these benefits, including for remote, rural and regional areas of Australia, in all its work.

 

Item 29A - At the end of subsections 18(2) and 22(4)

 

52.               Before appointing a person as an Authority member or an associate Authority member, the Minister must be satisfied that the person has substantial expertise in at least one of a list of fields in subsections 18(2) (for Authority members) and 22(4) (for associate Authority members) of the CCA Act. This item adds ‘rural and regional development’ and ‘community energy’ to those lists. This amendment reflects the importance of these matters in Australia’s response to climate change.

 

Item 30 - Paragraph 57(4)(a)

 

53.          This item repeals paragraph 57(4)(a), which refers to the Climate Change Minister’s directions to the Climate Change Authority with reference to the CEA Act.

 

Item 31 - After subsection 57(4)

 

54.          This item inserts subparagraph (4A), adding ‘Australia’s greenhouse gas emissions reduction targets’ under subsection 57(4), with which the Climate Change Minister’s directions to the Climate Change Authority must not be inconsistent. This furthers the independence of the Climate Change Authority and ensures Ministerial directions cannot be used to undermine the achievement of Australia’s greenhouse gas emissions reduction targets.

 

Item 32 - Paragraph 82(l)

 

55.          This item removes reference to ‘Part 22 of the Clean Energy Act 2011 ’ and substitutes it with ‘Part 4 of the Climate Change Act 2022 ’.

 

Export Finance and Insurance Corporation Act 1991

 

56.          The Export Finance and Insurance Corporation Act 1991 (the EFIC Act) establishes the Export Finance and Insurance Corporation (‘the Corporation’, which has operated under the name Export Finance Australia since 1 July 2019), for the purpose of facilitating and encouraging Australian export trade and overseas infrastructure development.

 

57.          As the Australian Government’s export credit agency, Export Finance Australia uses commercial financing tools, such as loans, bonds, guarantees and equity, to support Australian exports. Export Finance Australia also finances quality infrastructure in the Indo-Pacific region, where there is a benefit to Australia. 

 

Item 33 - Subsection 3(1)

 

58.          This item inserts definitions of ‘Australia’s greenhouse gas emissions reduction targets’ and ‘Paris Agreement’ into subsection 3(1), which provides for the interpretation of terms in the EFIC Act.

 

Item 34 - Subparagraph 8(2)(b)(iii)

 

59.          This item inserts ‘(including the Paris Agreement), and Australia’s greenhouse gas emissions reduction targets’ into subparagraph 8(2)(b)(iii) of the EFIC Act, which lists the matters that Export Finance Australia must have regard to in performing its functions. The amendments are intended to embed consideration by Export Finance Australia of Australia’s obligations under the Paris Agreement and emissions reductions targets in the performance of its functions. The amendments are not intended to limit the exercise of Export Finance Australia’s powers or performance of its functions, or to imply that Export Finance Australia should not have regard to Australia’s other international obligations.

 

60.          In performing its functions, Export Finance Australia, through its mandate to support exports, can help grow Australian businesses that are developing, or supporting the development of, products and services that can contribute to emissions reduction. Export Finance Australia can also, through its overseas infrastructure mandate, finance infrastructure in the Indo-Pacific that can support emissions reduction.

 

Greenhouse and Energy Minimum Standards Act 2012

 

61.          The Greenhouse and Energy Minimum Standards Act 2012 (the GEMS Act) established a national framework for regulating the energy efficiency of products supplied or used within Australia, implementing Australian Government and Commonwealth, State and Territory Energy Ministers’ commitments to establish national legislation to regulate energy efficiency and labelling standards for appliances and other products. The national framework replaced seven state and territory legislative frameworks, harmonising the regulation of equipment energy efficiency. The GEMS Act permits the Australian Government to set mandatory minimum efficiency requirements for products to drive greater energy efficiency for regulated products. The Act also allows the Australian Government to set nationally consistent labelling requirements to increase Australians’ awareness of options to improve energy efficiency and reduce energy consumption, energy costs and greenhouse gas emissions. Suppliers are required to register GEMS products prior to supplying or offering to supply those products in Australia.

 

62.          The following amendments related to the Paris Agreement were previously included in the Regulator Performance Omnibus Bill 2022 and were supported by stakeholders and States and Territories as part of the intergovernmental scheme.

 

Item 35 - Section 3

 

63.          This item updates the guide to the Act in section 3 to clarify that Division 5 of Part 1 of the Act sets out the constitutional application of the GEMS Act. This is a consequence of the repeal of section 21 and introduction of section 7A.

 



Item 36 - After paragraph 4(a)

 

64.          This item inserts a new paragraph 4(aa). That new paragraph provides that an object of the GEMS Act is ‘to give effect to certain obligations that Australia has under the Paris Agreement’ into section 4, which sets out the objects of the GEMS Act.

 

65.          Under Article 4.2 of the Paris Agreement Australia has obligations to take domestic action to reduce emissions in line with its Nationally Determined Contribution. The GEMS level requirements and GEMS labelling requirements, with associated requirements under section 27, play an important role in reducing energy use and emissions in Australia and can help support low emissions energy systems.

 

Item 37 - Section 5

 

66.          This item inserts a definition of ‘Paris Agreement’ into section 5, which sets out the Dictionary for the Act.

 

Item 38 - After section 7

 

67.          This item inserts a new section 7A after section 7. This new section sets out the constitutional application of the GEMS Act in a more direct way, but consistent with, existing section 21. The drafting removes any ambiguity in how section 21 would apply and how the relevant obligations in the Act relating to supplies, offers to supply or use for commercial purposes are interpreted. While the external affairs power provides broad support for the Act and relevant requirements, it is acknowledged that the relevant activities can also be regulated by the Act consistent with other heads of legislative power, such as the corporations power and trade and commerce power. The drafting is consistent with current practice for these provisions in Commonwealth legislation.

 

Item 39 - Section 15

 

68.          This item removes reference to Division 4 of Part 3 under section 15, which sets out a guide to Part 3.

 

Item 40 - Division 4 of Part 3

 

69.          This item removes Division 4 of Part 3 as the constitutional limitation provision in section 21 has been remade as section 7A.

 

Infrastructure Australia Act 2008

 

70.          The Infrastructure Australia Act 2008 (the IA Act) establishes Infrastructure Australia, with the mandate to advise governments, industry and the community on the investments and reforms needed to deliver better infrastructure for all Australians. Infrastructure Australia maintains an Infrastructure Priority List to ensure that public funds are directed towards projects that will deliver the best outcomes for our growing communities.

71.          The amendments allow for Australia’s greenhouse gas emissions reduction targets to be taken into account when conducting audits of nationally significant infrastructure, developing plans, and in exercising advisory functions.

 

Item 41 - Section 3

 

72.          This item inserts definitions for ‘Australia’s greenhouse gas emissions reduction targets’ and ‘Paris Agreement’ into section 3, which sets out Definitions for the IA Act.

 

Item 42 - At the end of paragraph 5(a)

 

73.          This item inserts ‘Australia’s greenhouse gas emissions reduction targets’ to the matters Infrastructure Australia takes into account in its function to conduct audits to determine the adequacy, capacity and condition of nationally significant infrastructure. Infrastructure Australia’s Australian Infrastructure Audit 2019 already gave extensive consideration to climate change issues, including how policy uncertainty at the time was impacting energy markets and has impacted energy affordability. This does not preclude other relevant issues being considered, including in relation to climate risk and adaptation.

 

Item 43 - After subparagraph 5B(1)(c)(ii)

 

74.          This item inserts ‘Australia’s greenhouse gas emissions reduction targets’ to the matters that Infrastructure Australia takes into account in its function of developing plans, to be given to the Minister. Infrastructure Australia’s 2021 Australian Infrastructure Plan included detailed consideration of climate change and emissions reduction issues, stating that ‘as the infrastructure sector influences about 70% of Australia’s emissions, it must be a leading enabler and adopter of low-emissions technology”. This does not preclude other relevant issues being considered, including in relation to climate risk and adaptation.

 

Item 44 - Paragraph 5C(1)(ba)

 

75.          This item inserts ‘including the achievement of Australia’s greenhouse gas emissions reduction targets’ to policy issues arising from climate change. The paragraph already references climate change policy issues and this reference reinforces the importance of the greenhouse gas emissions reduction targets as part of those issues.

 

National Greenhouse and Energy Reporting Act 2007

 

76.          The National Greenhouse and Energy Reporting Act 2007 (the NGER Act) establishes the National Greenhouse and Energy Reporting (NGER) scheme, which provides a single framework for reporting and disseminating company information about greenhouse gas emissions, energy production, energy consumption and other information specified under the legislation.

 

77.          The NGER Act also establishes the safeguard mechanism, which provides requirements for Australia’s largest emitters to measure, report and manage their emissions. It encourages large facilities, whose net emissions exceed the safeguard threshold, to keep their emissions at or below emissions baselines.

 

78.          Data reported by companies under the NGER scheme is used to prepare Australia’s National Greenhouse Accounts to fulfil Australia’s domestic and international greenhouse gas emissions reporting obligations under the UNFCCC, Kyoto Protocol and Paris Agreement. It is also used to prepare the Australian Energy Statistics to fulfil Australia’s international energy production and consumption reporting obligations to the International Energy Agency; to ensure companies are fulfilling their obligations under the Safeguard Mechanism; to inform policy development and review for Commonwealth, state and territory agencies; and to avoid duplication of state and territory requirements for corporations.

 

79.          The amendments to the NGER Act will make clear that the safeguard mechanism contributes to the achievement of Australia’s greenhouse gas emissions reduction targets and the Paris Agreement. The government will consult on changes to the safeguard mechanism as part of its Powering Australia plan to ensure it delivers on this objective.

 

Item 45 - Subsection 3(2)

 

80.          This item removes ‘ensure’ and substitutes it with ‘contribute to the achievement of Australia’s greenhouse gas emissions reduction targets by ensuring’ to the second object of the NGER Act under section 3.

 

81.          This item clarifies that the safeguard mechanism is intended to be a key policy connected with the achievement of the targets and is not just a mechanism to cover exceptional increases in emissions. The extent of the required ‘contribution’ is a matter for government and will be determined in consultation with relevant stakeholders.

 

Item 46 - Section 7      

 

82.          This item inserts definitions for ‘Australia’s greenhouse gas emissions reduction targets’ and ‘Paris Agreement’ into section 7, which sets out Definitions for the Act.

 

Northern Australia Infrastructure Facility Act 2016

 

83.          The Northern Australia Infrastructure Act 2016 (the NAIF Act) establishes the Northern Australia Infrastructure Facility (NAIF) to provide financial assistance to the States and Territories, and other entities, for the development of Northern Australia economic infrastructure.

84.          The NAIF contributes to the development of northern Australia, through financing that drive public benefit, economic and population growth and Indigenous involvement. The

 

85.          NAIF investment includes investment towards energy projects. The amendments would allow for the consideration of Australia’s emissions reduction targets when determining the terms and conditions for the provision of financial assistance to entities from the NAIF.

 

Item 47 - Section 5

 

86.          This item inserts definitions for ‘Australia’s greenhouse gas emissions reduction targets’ and ‘Paris Agreement’ into section 5, which sets out Definitions for the NAIF Act.

 

Item 48 - Subparagraph 7(1A)(g)(ii)

 

87.          This item removes ‘or’ and in its place inserts ‘and’ in subparagraph 7(1A)(g)(ii) of the NAIF Act to facilitate the inclusion of subparagraph 7(1A)(g)(iii), which is done by Item 43.

 

Item 49 - At the end of paragraph 7(1A)(g)

 

88.          This item inserts ‘contributing to the achievement of Australia’s greenhouse gas emissions reduction targets’, to the function of providing financial assistance to other entities for the development of Northern Australia economic infrastructure, after subparagraph 7(1A)(g)(ii) of the NAIF Act.

 

Offshore Electricity Infrastructure Act 2021

 

89.          The Offshore Electricity Infrastructure Act 2021 (the OEI Act) regulates offshore renewable energy infrastructure and offshore electricity transmission infrastructure. It makes provision for the relevant Minister to declare areas as suitable for offshore renewable energy infrastructure, and provides for a licencing regime for research, exploration, exploitation and transmission of renewable energy resources.

 

90.          Recognising the key role that offshore renewable energy can play in contributing to meeting Australia’s greenhouse gas emissions reduction targets, the proposed amendments will enable the Minister to specifically consider those targets when making decisions under the OEI Act about whether to make a declaration that an area is suitable for offshore renewable energy infrastructure. Notwithstanding that the relevant targets are Australia’s greenhouse gas emissions reduction targets, and not global emissions reduction, it is not intended that these amendments would prevent the export of renewable energy outside of Australia, or require an adverse decision where export of renewable energy outside of Australia was being proposed.

 

Item 50 - Section 8

 

91.          This item inserts definitions for ‘Australia’s greenhouse gas emissions reduction targets’ and ‘Paris Agreement’ into section 8, which sets out Definitions for the OEI Act.

 

Item 51 - At the end of subsection 19(1)

 

92.          This item adds ‘Australia’s greenhouse gas emissions reduction targets’ to the matters the Minister must have regard to in deciding whether an area is suitable for offshore renewable energy infrastructure for the purposes of making a declaration under section 7 of the OEI Act. The intention is to make the potential contribution of the areas to emissions reductions relevant to weighing up the matters required to be considered under subsection 19(1) of the OEI Act and which may also be taken into account in the decision. The reference to the targets does not preclude renewable generation from such areas being exported and also contributing to emissions reductions overseas, as these are factors which may be relevant for consideration under subsection 19(2). It is also not intended that a precise estimate of such contribution be determined at the time of the declaration as this will depend upon the licences and projects which are subsequently developed in the declared area. It is expected that potential emissions reduction benefits flowing from the declaration would be a factor supporting the making of such declarations.

 

Item 52 - At the end of subsection 22(3)

 

93.          This item adds ‘Australia’s greenhouse gas emissions reduction targets’ to the matters the Minister must have regard to in deciding whether to vary a declaration of an area as suitable for offshore renewable energy infrastructure under section 22 of the OEI Act.

 

Item 53 - At the end of subsection 23(3)

 

94.          This item adds ‘Australia’s greenhouse gas emissions reduction targets’ to the matters the Minister must have regard to in deciding whether to vary a declaration of an area as suitable for offshore renewable energy infrastructure under section 23 of the OEI Act.

 

Item 54 - After paragraph 26(3)(b)

 

95.          This item adds ‘Australia’s greenhouse gas emissions reduction targets’ to the matters the Minister must have regard to in deciding whether to revoke a declaration of an area as suitable for offshore renewable energy infrastructure.

 

Renewable Energy (Electricity) Act 2000

 

96.          The Renewable Energy (Electricity) Act 2000 (the REE Act) establishes the Commonwealth Renewable Energy Target, including the Large-scale Renewable Energy Target and the Small-scale Renewable Energy Scheme. The REE Act provides for the issuing of certificates for the generation of electricity using eligible renewable energy sources and requiring certain purchasers (usually electricity retailers) to surrender a specified number of certificates for the electricity they acquire during a year.

 

97.          The amendments to the REE Act add an additional object ‘to contribute to the achievement of ‘Australia’s greenhouse gas emissions reduction targets’ and adds reference to ‘Australia’s greenhouse gas emissions reduction targets’ and the ‘Paris Agreement’. No changes are proposed to the operation of the schemes supported by the Act.

 

Item 55 - Section 3

 

98.          This item inserts an additional object to the REE Act ‘to contribute to the achievement of Australia’s greenhouse gas emissions reduction targets’ into section 3, which sets out the objects of that Act.

 

Item 56 - Subsection 5(1)

 

99.          This item inserts definitions for ‘Australia’s greenhouse gas emissions reduction targets’ and ‘Paris Agreement’ into section 5, which sets out Definitions for the REE Act.

 

Science and Industry Research Act 1949

 

100.      The Science and Industry Research Act 1949 (the SIR Act) establishes the CSIRO, Australia's national science research agency. The CSIRO is one of the largest and most diverse scientific research organisations in the world. It focusses on innovative science and technology to contribute to solving the greatest challenges facing the nation, including responding to climate change. It also manages national research infrastructure and collections.

 

101.      The CSIRO’s research on climate change issues is internationally acclaimed. The CSIRO collaborates with Australian and global stakeholders to understand the role of the atmosphere, land and oceans in the earth system and provide comprehensive, rigorous science to respond to and plan for a changing climate. As Australia's national science agency, the CSIRO has supported Australian government and industry in catalysing Australia's energy transition towards net zero emissions. This has included crucial work and analysis on clean energy technologies, including hydrogen, energy storage and solar technologies. The depth of CSIRO’s scientific expertise in these areas, that are connected to Australia’s greenhouse gas emission reduction targets, supports the inclusion of an additional function as part of this package of amendments.

 

Item 57 - Section 7

 

102.      This item inserts a definition for the ‘Paris Agreement’ into section 7, which sets out the interpretation of terms in the SIR Act.

 

Item 58 - After subparagraph 9(1)(a)(iii)

 

103.      This item inserts a new subparagraph 9(1)(a)(iiia). That new subparagraph gives an additional purpose for which the CSIRO carries out scientific research, namely, ‘contributing to giving effect to Australia’s obligations under the Paris Agreement’. This addition is consistent with subparagraph 9(1)(a)(iii) which already refers to contributing to the achievement of Australia’s national objectives, which includes the relevant climate change issues and has been used to support the extensive work program of the CSIRO in this field to date.

 

104.      It is recognised that the Paris Agreement includes a range of obligations relating to the mitigation of greenhouse gas emissions, climate science, enhancing reservoirs and sinks, enhancing adaptive capacity, strengthening resilience and reducing vulnerability to climate change, technology development and transfer, enhancing climate change education, training, public awareness, public participation and public access to information. The CSIRO already contributes to these obligations and will continue to do so into the future in performing its functions.

 

105.      The addition of this function does not limit, restrict or otherwise alter the other functions or powers already conferred on the CSIRO by the SIR Act.

 

Part 2 - Transitional

 

Item 59 - Transitional - infrastructure plans

 

106.      This item ensures that the amendment of section 5B of the Infrastructure Australia Act 2008 does not affect the continuity of an Infrastructure plan that was given to the Minister before commencement of the amendment.