Carbon Tax and Emission Reporting:

The federal government passed the Clean Energy Act 2011 (Cth) which came into force in 2012 and created a scheme whereby a tax has now been imposed for carbon emissions under certain circumstances. The carbon tax has commenced at $23.00 per ton of carbon emission, however this will increase with time. The tax will then gradually be replaced with a carbon trading scheme.

Australian markets have been linked to a global carbon emission scheme since 1 July 2015. A price ceiling will operate until 2018 to allow the system to properly function without prejudicing local businesses in the event of inordinately high prices in those early years of the system’s operation.

Under the scheme, an Australian business will be able to buy a permit and thereby reduce the emission of carbon into the atmosphere in a developing country. “Clean Energy Future” states that the government has placed limitations on permits from the United Nations Clean Development Mechanism to safeguard Australian businesses.

Further restrictions can be made by the “Climate Change Authority”. Half of the permits will have to be domestic permits, such as the Carbon Farming Initiative, up until 2020 (this will be reviewed by the “Climate Change Authority” in 2016). The Clean Development Mechanism credits intended for use from 2015 will include the following:

• Kyoto “Certified Emission Reduction Units” and “Emission Reductions Units”, but with restrictions to exclude reduction units sourced from:
  • Nuclear energy projects;
  • Certain industrial gas destruction projects;
  • Large-scale hydro-electric projects that are inconsistent with the criteria from World Commission on Dams as adopted by the European Union; and
  • Certain time-limited land sector projects as these would expire before 2020;
• Kyoto Removal Units.

If you are a company that involves any form of carbon emissions in their course of its business activities, it is important that you discharge your obligations under the Clean Energy Act 2011 (Cth) so as not to incur any liabilities. Compliance with the law is necessary. Noncompliance is particularly risky given market operators may not be wholly familiar with a news system’s particulars.

If you believe that any liability may arise under the Clean Energy Act 2011 (Cth), there may be a variety of important legal considerations that might need to be weighed before you finally decide how to approach your legal problem. Our energy resource lawyers have the expertise and experience needed to guide those in need of assistance in this field.

To book an initial consultation, contact our firm by telephone on (02) 9233 4048 or by email to info@navado.com.au. 

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