(24 March 2022 – Australia) Australian National University Law School Professor Andrew Macintosh has roundly criticised the integrity of carbon offset schemes under the Australian government's Emissions Reduction Fund, calling for far greater regulation and oversight.
Macintosh expressed his concerns about the hundreds of millions of dollars the government is allocating to projects designed to cut emissions, asserting that integrity standards set down in legislation are being compromised. In particular a critical requirement that all greenhouse gas reductions under the schemes be additional to what would have happened in the normal course of events.
In Q1 2022 Australian carbon credits jumped to a record high exceeding A$55 a tonne however by the outset of March the price collapsed by over 30 percent following the announcement that market participants will now be able to apply to opt out of their fixed-delivery carbon credit contracts with the federal government and enter the far more lucrative open market.
The Clean Energy Regulator who oversees market regulation and integrity has outright dismissed Professor Macintosh’s allegations as false.
Australian bank majors have also declared a pressing need for more alignment on reporting gaps including from their biggest emitting clients after the US Securities Exchange Commission (SEC) proposed mandating that banks disclose their financed emissions. The Big Four report that significant gaps remain in how enterprises report emissions, making it challenging for banks to accurately monitor and report their own emissions.
“I'm not saying all credits are devoid of integrity. But it appears from the analysis we've done, and the evidence we have seen, that somewhere in the order of 70 to 80 per cent of the credits that have been issued are markedly low in integrity” Professor Macintosh commented.
“Payments are being made to people to not chop down forests that were never going to be chopped down, to grow forests that are already there, to grow forests in places that will never sustain permanent forests” McIntosh added.