Express law No. 63

4 October 2007

New national greenhouse and energy reporting framework

The National
Greenhouse and Energy Reporting Act 2007
was
enacted on 28 September 2007. The NGER Act will establish
a national framework for the reporting of greenhouse
gas emissions, energy production and consumption,
and greenhouse gas abatement activities by corporations.

The National Greenhouse and Energy Reporting System
(NGER System) is intended to be the single reporting
mechanism for a range of Commonwealth, state and territory
programs. In particular, it is intended to underpin a
future Australian Emissions Trading Scheme. The NGER
System will commence on 1 July 2008.

Background

Currently, a range of Commonwealth, state and territory
programs require corporate entities to report data relating
to energy production, energy consumption, and greenhouse
gas emissions levels (for example, the New South Wales
/ Australian Capital Territory Greenhouse Gas Abatement
Scheme, the Queensland ecoBiz scheme, the Victorian EPA
Industry Greenhouse Program, and the Commonwealth Greenhouse
Challenge Plus and Energy Efficiency Opportunities schemes).

The Australian Government's 2004 Energy White Paper, Securing
Australia's Energy Future
, stated that the
government would reduce the greenhouse and energy reporting
burden on companies by streamlining reporting through
a single system operating across all Australian jurisdictions.
To this end, the government introduced the National
Greenhouse and Energy Reporting Bill into Parliament
on 15 August 2007.

Key elements of the National Greenhouse and Energy Reporting
Act

Establishment of the Greenhouse and Energy Data Officer

The NGER Act provides for the appointment of the Greenhouse
and Energy Data Officer (GEDO), who has a number of functions
and decision-making powers under the NGER Act. The GEDO
will be engaged under the Public Service Act 1999.

Which entities are required to participate in national
greenhouse and energy reporting

The controlling corporation of a corporate group is the
responsible entity in relation to that corporate group
for the purposes of the NGER System. A controlling corporation
is a constitutional corporation (within s 51(xx) of the
Constitution) that does not have a holding company incorporated
in Australia. The members of the controlling corporation's
group include its subsidiaries (and any subsidiaries of
those subsidiaries), as well as partnerships and joint
ventures that the controlling corporation is involved in
(unless another partner or participant has been nominated
to be responsible for the partnership or joint venture
for the purposes of the NGER System).

Registration

A controlling corporation must register for the NGER System
if its corporate group meets the relevant thresholds for
energy consumption or production, or greenhouse gas emissions,
in the relevant financial year.

Greenhouse gas emissions, or energy production or consumption,
must be counted towards the corporate group's total
if the emissions, production or consumption result from
the operation of a facility over which a corporate group
member has operational control. These terms are partially
defined in the NGER Act and further content to these definitions
will be included in the regulations made under the NGER
Act. The GEDO also has a power to decide whether certain
activities constitute a 'facility' and which
corporate entity has operational control over a particular
facility.

For the 2008–09 financial year, the registration
thresholds are:

  • gas emissions for the corporate group: 125 kilotonnes
    or more
  • energy production for the corporate group: 500 terajoules
    or more
  • energy consumption for the corporate group: 500 terajoules
    or more.

The threshold levels progressively reduce over the following
two financial years.

A controlling corporation must also register for the NGER
System if a single facility over which a group member has
operational control meets one of the following thresholds:

  • greenhouse gases: a carbon dioxide equivalence of
    25 kilotonnes or more
  • production of energy of 100 terajoules or more, or
  • consumption of energy of 100 terajoules or more.

Mandatory reporting

Registered corporations must lodge a report with the GEDO
within four months of the end of each financial year. The
report must contain certain information relating to the
greenhouse gas emissions, energy production and energy
consumption for the corporate group during the financial
year.

Persons other than the registered corporation may be required
to report information that the registered corporation would
otherwise have to report, pursuant to a determination of
the GEDO. The GEDO may make such a determination, in general,
where a person other than the registered corporation has
possession or control of the data and the registered corporation
is not entitled to acquire the data from that person.

Voluntary reporting about greenhouse gas projects

The NGER Act also incorporates a voluntary reporting scheme
for corporations involved in greenhouse gas reduction,
removal and offset projects that meet the requirements
set out in the regulations.

Publication of national greenhouse and energy reporting
information

The GEDO must keep a register of registered corporations,
and may publish it. The register is expected to contain
information about the corporations' compliance with
the NGER System; however, the details of the information
to be entered on the register will be set out in regulations.

The GEDO must also publish an annual financial year report
which includes the totals of the greenhouse gas emissions,
energy production and energy consumption reported in relation
to certain corporate groups for the year. The GEDO may
also publish information relating to greenhouse gas projects
undertaken by a corporation during the year.

Participants may apply to the GEDO not to publish information
about the corporate group if the information reveals, or
may reveal, trade secrets or other information of commercial
value where publication may diminish that value. The GEDO
may accept or reject the application.

Compliance and monitoring provisions

A court may, on application from the GEDO, award a civil
penalty of up to 2,000 penalty units against a corporation
for breach of its obligation to register or obligation
to report under the NGER Act. In some circumstances, chief
executive officers of the corporation may be personally
liable for a civil penalty in relation to a breach.

An alternative compliance regime is provided through the
GEDO's power to issue an infringement notice to a
person whom the GEDO reasonably believes has contravened
a civil penalty provision. The person may pay the infringement
notice penalty (one-fifth of the maximum penalty a court
could impose for that contravention) to avoid the GEDO
commencing court proceedings in relation to the contravention.
The GEDO may also accept enforceable undertakings from
participants relating to the compliance by the participant
with the NGER Act and regulations.

The NGER Act provides for a scheme for 'authorised
officers' to be appointed by the GEDO. In prescribed
circumstances, authorised officers have powers to enter
and search premises, inspect documents and activities,
and question persons in relation to compliance with the
NGER Act.

In addition, the GEDO has powers to:

  • request information relating to compliance with the
    NGER Act
  • require corporations to undertake an external audit
    of compliance
  • seek monitoring warrants for access to premises for
    compliance purposes.

Relationship with other Commonwealth, state and territory
schemes

The NGER Act will apply to the exclusion of a state or
territory law in relation to a constitutional corporation
where that law:

  • provides for the reporting or disclosure of information
    related to greenhouse gas emissions, greenhouse gas projects,
    energy consumption or energy production
  • that law (or part of the law) is specified in regulations
    under the NGER Act.

The NGER Act contains standard secrecy provisions relating
to information reported under the NGER Act. However, the
NGER Act also establishes an information sharing scheme
to allow for information reported through NGER to be disclosed
to prescribed Commonwealth, state and territory officers
for the purposes of administering programs relating to
greenhouse gas emissions or energy consumption or production.
Certain information may also be disclosed to states and
territories.

For further information please contact:

Leo Hardiman
Senior General Counsel
T 02 6253 7074 F 02 6253 7304
leo.hardiman@ags.gov.au

Nick Wood
Counsel
T 02 6253 7053 F 02 6253 7304
nick.wood@ags.gov.au

Catherine Thomson
Counsel
T 02 6253 7465 F 02 6253 7304
catherine.thomson@ags.gov.au

Jenny Francis
Client Counsel, Department of Industry, Tourism and Resources
T 02 6213 6813 F 02 6213 7110
jenny.francis@ags.gov.au

Helen Neville
Client Counsel, Department of the Environment and Water
Resources
T 02 6274 1391 F 02 6274 1009
helen.neville@ags.gov.au

Important: The material in Express law is
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information only, and further analysis on the matter
may be prepared by AGS. The material should not be
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Please contact AGS before any action or decision is
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