There are questions over the government’s review of Australian Carbon Credit Units (ACCUs) after a member of the review panel discussed the “potential” for investment in ACCUs by an infrastructure fund she is linked to.
In July the government announced a review of ACCUs in the wake of a whistleblower, ANU professor Andrew Macintosh, revealing significant problems with credits generated by the Coalition’s Emissions Reduction Fund. Up to 80% of ACCUs generated by the scheme may be worthless in terms of actual additional emissions abated under the ERF — a claim rejected at the time by the Clean Energy Regulator that oversees the ERF.
The government will be relying on ACCUs and a new class of carbon credits created under its revamped safeguards mechanism as part of its emissions reduction plans.
The review is headed by Professor Ian Chubb, with former Federal Court judge the Hon Dr Annabelle Bennett, Ariadne Gorring and Steve Hatfield-Dodds on the panel. The review is scheduled to report by the end of the year. The Australia Institute has previously raised concerns about the potential appearance of conflict of interest in the part of Gorring and Hatfield-Dodds.
Bennett is also chair of the trustee company Gardior, which is trustee of The Infrastructure Fund (TIF), a $2.5 billion Brisbane-based infrastructure investment fund that amongst other assets holds 50% of the Port of Newcastle as well as stakes in the Gold Coast and Perth airports. TIF is managed by Macquarie Group’s Macquarie Infrastructure and Real Assets (MIRA).
On October 31, Macquarie invited TIF investors to an investor day at Gold Coast Airport, where Bennett and three other Gardior directors spoke to investors.
According to a statutory declaration tabled in Parliament by ACT senator David Pocock on November 7, an unidentified TIF investor says Bennett, after opening remarks, unsolicited, spoke about “the potential for ACCUs across the TIF portfolio” and noted she was a member of the Chubb review panel.
An attendee asked Bennett about the integrity issues around ACCUs. According to the statutory declaration, Bennett replied with words to the effect that the review was a result of concerns about integrity, that a group of academics had made allegations and that the review would report by the end of the year.
If correct, Bennett’s reported remarks suggesting the “potential” for ACCUs (which might also appear to be an unusual investment for an infrastructure fund) appear incongruous with the Chubb review’s remit to “review the integrity of Australian Carbon Credit Units (ACCUs) under the Emissions Reduction Fund.”
A finding that ACCUs issued as a result of ERF activities have fundamental problems might result in their being withdrawn, which would push the ACCU price up significantly as a result of dramatically reduced supply.
Crikey invited Bennett to respond to the statutory declaration via the Chubb review secretariat, including asking her to confirm if the declaration was correct. The secretariat responded, “Dr Bennett participated in a director panel discussion where the purpose was to introduce the directors, and to outline briefly what they do”.
The review team also pointed out that “a robust probity framework has been put in place for the review. Each panel member has signed a number of probity forms, including confidentiality and conflict of interest declarations, and are each intimately aware of the importance of integrity and transparency whilst conducting the work of the review.”
Senator Pocock told Crikey: “Integrity in our carbon markets is absolutely crucial. Given some of the concerns that have been raised with a number of ACCU methods, the government’s review led by Professor Chubb is critical. The matters raised in the statutory declaration merit further investigation as they are potentially concerning.
“If we cannot trust that our carbon market is achieving genuine and additional abatement, claims of net reductions in emissions risk becoming meaningless.”
The core problem is that capitalism is no longer fit for purpose as humanity’s primary economic system. All the rest – taxes, carbon credits and everything else – is just tinkering at the edges.
carbon credits are a scam
Henbury station, northern Territory, 2010. The Sydney Kidman company decided carbon credits were the way to go. They destocked the station and let the grass grow. 2010 was a wet year and the buffel grass grew like topsy. A lot a carbon got sucked out the atmosphere. 2011 was a dry year. A lot of bushfires in the NT that year. There was a fire at Henbury. A lot of carbon went back into the atmosphere. That was the end of that project. Amen.
I can’t escape the feeling that offsets in soil carbon and vegetation are nothing more than wishful thinking. If the earth maintained an equilibrium 180-280 ppmv of CO2 in the atmosphere during hundreds of thousands of years before extensive clearing, massive expansion of the human population, industrialisation, etc., without any fossil fuel combustion, I can’t see how we can expect ‘nature’ to drive down CO2 levels by any more than the amount released as a result of land clearing and changes of land use in the first place. And that assumes we convert all of the modified landscape back to prehistoric patterns and levels.
All that fossil C took millions of years to lock away as coal, oil and gas. You can’t release it into the atmosphere in 150 years and expect nature to just hoover it up in a similar time frame. And remember, the build up of atmospheric CO2 has only been about half of the level of fossil fuel combustion so we have been relying on the ocean to mop up a large portion of the emissions to date. I doubt – but don’t know for sure – there is much capacity to nudge ocean assimilation much higher.
Fossil fuel use adds carbon to the atmosphere. Full stop. In my opinion, carbon farming, at best, can be expected to compensate to some extent for emissions arising from changed land use. I can’t see it compensating for fossil fuel emissions on top of that.
Thanks for this piece, Bernard. So the four on the review committee were appointed by current ALP govt? If so, Labor being bi-partisan is apparently working to its own detriment. The only people coming out well in this affair are Pocock and the ANU whistleblower.