We take compliance action to ensure the integrity of our schemes. Our compliance update keeps you informed of activities related to our Compliance and Enforcement Priorities. The update sets out our expectations of compliance by scheme participants and highlights the areas of focus for compliance action.
Australian Carbon Credit Unit (ACCU) Scheme
ACCU integrity
In 2024, 18.7m ACCUs were issued under the scheme. ACCUs are only issued where robust and reliable evidence is provided. As is our standard process, where we identified discrepancies or gaps, project proponents were required to provide additional evidence or take appropriate action including re-stratification for area-based projects prior to ACCUs being issued. In this quarter, we issued requests for further information for 24 crediting applications (9% of applications). This is a 4.6% decrease from the previous quarter.
Human-induced regeneration (HIR) gateway checks
The third independent review report by Associate Professor (Honorary) Cris Brack was published on 9 December 2024. The review looked at 33 human-induced regeneration (HIR) projects (including 18 projects reported on in August 2024) that had been subject to a gateway audit. Prior to Assoc Prof Brack’s review, all projects were assessed by us.
The latest report found the re-stratification of carbon estimation areas (CEAs) is key to the integrity of the HIR portfolio and ensures that only regenerating CEAs are issued ACCUs. This review report supports earlier findings that only using national-scale models of tree cover is unreliable for many projects, particularly in Western Australia.
Assoc Prof Brack said the independent audit reports and our reviews using multiple lines of evidence remain robust and continue to provide strong assurance that projects are being managed as per the HIR requirements.
National Greenhouse and Energy Reporting (NGER) Scheme and Safeguard Mechanism
2023–24 NGER reporting
Emissions and energy generation and usage reports from NGER reporters were due by 31 October 2024. Compliance with on time reporting exceeded 98%.
We published the details of 5 organisations that submitted late. Late reporters were issued letters putting them on notice that a failure to submit a report by the due date is a contravention of the National Greenhouse and Energy Reporting Act 2007 and repeated non-compliance may result in the issuing of an infringement notice or commencement of civil penalty proceedings.
Safeguard Mechanism
The first NGER reporting deadline under the reformed Safeguard Mechanism has passed and all Safeguard facilities reported within the required timeframe.
We expect that each Safeguard facility’s net emissions will be at or below its baseline by no later than 31 March 2025. Safeguard facilities that exceed or expect to exceed their baseline must manage their excess emissions through the surrender of ACCUs, Safeguard Mechanism Credits or approval for the use of a flexibility measure under the scheme. Safeguard facilities who fail to do so by 31 March 2025 should expect that we will commence civil penalty proceedings. The initial civil penalty is $330 for each tonne the facility is above its baseline, plus $33,000 per day the facility remains in excess.
Renewable Energy Target
Monitoring warrant executed as part of an ongoing investigation into a group of registered agents
On 5 December 2024, we executed a monitoring warrant on a business involved in solar panel retail, installation, and renewable energy certificate creation to assess the company’s compliance with the Renewable Energy (Electricity) Act 2000 (Act).
We are also concerned that the business is part of a network, linked to companies that have been found by us to not be fit and proper and have had their registration permanently suspended under the Act. This means they can no longer create certificates. Where we have decided that an entity or individual is not fit and proper, we will not tolerate its ongoing participation in our schemes through other entities.
Registered agents are reminded of their obligations, which include maintaining accurate records, operating procedures, and ensuring that all contractual (payment) obligations are met. Retailers should ensure that they do their due diligence on which registered agents they do business with.
Information about registered persons and agents, including those currently suspended, can be found by searching registered persons in the REC Registry.
Notice of Intent issued to NetZero
On Thursday 19 December 2024, we issued a Notice of Intent to suspend the registration of NetZero Environmental Group Pty Ltd (NetZero) from the Renewable Energy Target scheme under section 30A of the Renewable Energy (Electricity) Act 2000.
A Notice of Intent provides an opportunity to respond to our concerns and affords the participant natural justice. It does not affect their participation in the scheme until a decision is made and then only if it is a decision to remove them from the scheme.
Criminal prosecution started against Small-scale Renewable Energy Scheme participant
A Western Australian solar retailer and 2 individuals have had 330 criminal charges laid following our investigation. We alleged that the retail company, aided and abetted by 2 individuals, knowingly provided false information which was later relied upon to create small-scale technology certificates (STCs).
The investigation included the execution of a criminal search warrant in September 2022. The investigation was undertaken in collaboration with the Australian Federal Police and Western Australian Department of Energy, Mines, Industry Regulation and Safety – Building and Energy Division.
We have zero tolerance for fraud. Those who do not comply with their obligations will have enforcement action taken against them under our compliance, education and enforcement policy.
Find out more about our Small-scale Renewable Energy Scheme compliance activities.
Universal Exim Pty Ltd registration permanently suspended
On 7 November 2024, we permanently suspended the registration of Universal Exim Pty Ltd under section 30A of the Act because we are satisfied that Universal Exim is no longer a fit and proper person. Universal Exim can no longer create renewable energy certificates. Further information on scheme participant obligations is available on our Fit and Proper Person posture.
Enforceable undertakings with Formbay Trading Pty Ltd and RACV Solar Pty Ltd
We have entered into enforceable undertakings with registered agent, Formbay Trading Pty Ltd (Formbay) and solar retailer RACV Solar Pty Ltd (RACV Solar) arising from non-compliance in the SRES.
Between 1 July 2021 and 5 August 2022, RACV Solar submitted false written statements to Formbay, claiming the installation of 28 solar photovoltaic (PV) systems were completed or supervised by a particular Clean Energy Council accredited installer, when in fact those systems were installed by another person. Formbay relied on the false information to create 1,945 STCs. As a result, we have accepted 2 enforceable undertakings offered by Formbay and RACV Solar to address the non-compliance. The enforceable undertakings commit Formbay and RACV Solar to each implement a compliance program and to inspect, and if necessary, rectify the solar PV systems.
We publish all enforceable undertakings.
Audit and auditors
Compliance audits
In this quarter, we received the finalised reports from 3 compliance audits (2 ACCU project proponents and one NGER reporter). We required the audits to be completed by a registered auditor of our choosing and at the participants’ cost.
All 3 audits have returned a qualified result. This means that the auditor identified areas of significant concern or contraventions of the legislation. We are assessing and investigating the non-compliance identified and will decide on appropriate compliance and enforcement actions consistent with our compliance, education and enforcement policy.
Auditor deregistered
We deregistered a greenhouse and energy auditor for not being contactable under the National Greenhouse and Energy Reporting Regulations 2008.
Auditors are reminded that they have ongoing obligations to maintain registration. Registered auditors who have ongoing performance issues or do not comply with legislative requirements will be subject to compliance action. This could include conditions placed upon their registration, improvement notices, suspension or deregistration.