Australia’s new Labor government has appointed a climate scientist to conduct a six-month review of the country’s carbon credit scheme, following concerns that certain projects receiving credits are not actually reducing carbon emissions.
In June, the new government has upped its 2030 reduction target to 43%, aiming to bring the country closer in line with other developed economies’ pledge.
The integrity of Australian Carbon Credit Units (ACCUs) provided by the government’s Emissions Reduction Fund will be critical in helping the country meet this new commitment, said Chris Bowen, Climate Change and Energy Minister. However, the scheme has been under pressure in recent times. In hopes of restoring public confidence, the government has thus arranged the review of the scheme.
Australia’s Emissions Reduction Fund awards credits to initiatives that prevent deforestation, regenerate native forests, or collect methane from landfills. These projects may be able to sell credits to the government or to businesses aiming to achieve their emissions-cutting commitments and voluntary targets.
Yet, Andrew Macintosh, a professor of Australian National University who previously worked with the Emissions Reduction Fund, revealed earlier this year the faults in the method credits are issued and described the scheme as a “environmental and taxpayer fraud,” with 80% of carbon credits failing to offer genuine abatement of greenhouse gas emissions.
His examples included initiatives that received credits for planting trees that were already in place, as well as those that received credits for developing forests on ground that could not sustain forests.
Trading in ACCUs has increased dramatically last year as companies seek to offset emissions in order to meet their own net zero targets, and trading is expected to increase even more under the new government, which seeks to cut emissions by 50% more than the previous government’s target for 2030.
“As carbon trading becomes increasingly important, ensuring the effectiveness of the Australian carbon credit unit framework is a top priority in that context,” Bowen said. He stated that the government would fully support any recommendations made by the inquiry, which will be overseen by one of the country’s former chief scientists.
