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Focus: National greenhouse and energy reporting amendments

1 April 2009

In brief: Recently, amendment regulations have come into force that streamline the registration process for companies that are required to register and report under the National Greenhouse and Energy Reporting Scheme and that support the operation of amendments that have been made to the National Greenhouse and Energy Reporting Act. Partner Grant Anderson (view CV) and Lawyer Nick Buttner report.

How does it affect you?

  • The amending regulations make a number of small but important amendments that will need to be taken into account by corporate groups that are covered by the National Greenhouse and Energy Reporting Scheme.

Background

On 29 September 2007, the National Greenhouse and Energy Reporting Act 2007 (the NGER Act) commenced, creating a national system for the reporting of greenhouse gas emissions, energy production and energy consumption of corporations. Data reported under the NGER Act will also facilitate and underpin the Federal Government's proposed Carbon Pollution Reduction Scheme.

Under the NGER Act, a corporation must be registered on a national database if it is the ultimate Australian holding company of a corporate group (or, in some cases, a foreign corporation) and facilities under the operational control of the corporate group (or foreign corporation) meet one or more specified reporting thresholds for greenhouse gas emissions, energy production or energy consumption. Each year, such registered controlling corporations will be required to report on the qualifying greenhouse gas emissions, energy production and energy consumption of their corporate group or facilities, depending on the applicable reporting threshold that has been met. The controlling corporation of those groups or facilities that come within a reporting threshold for the 2008-09 financial year must register under the NGER Act by 31 August 2009 and submit their first report by 31 October 2009.

Much of the specific detail about how the R Act applies to companies and how data is to be collected and reported is not spelt out in the Act itself but in the National Greenhouse and Energy Reporting Regulations 2008 (the NGER Regulations), which came into force on 1 July 2008.

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The NGER Amendment Regulations

The National Greenhouse and Energy Reporting Amendment Regulations 2009 (the NGER Amendment Regulations) make a number of important practical amendments to the NGER Regulations. The key changes are outlined below.

First, in an application for registration under the NGER Act a corporation now only needs to include the details of those group members (referred to as 'affected group members') that have operational control over a facility or that are undertaking, or propose to undertake, a greenhouse gas project to which the application relates. However, it should be noted that a controlling corporation's annual report is not confined to affected group members but extends to facilities under the operational control of any group members.

Second, the concept of 'identifying details' has been inserted. This means that where an entity (eg a group member) does not have an Australian Business Number (ABN) the following alternative identifying details can be provided:

  • the entity's Australian Company Number (ACN); or
  • if the entity does not have an ACN – its Australian Registered Business Number (ARBN); or
  • if the entity does not have an ARBN – its trading name and street address.

Third, a registered corporation that reports facilities as part of a vertically integrated production process is now:

  • able to aggregate the totals of greenhouse gas emissions, energy production and energy consumption by a contractor operating at those facilities; and
  • required to identify each facility of the corporation that forms part of that production process.

Amendments have also been made to other regulations. The principal amendments relate to:

  • additional information that is to be provided where a responsible entity is nominated for a joint venture or partnership, or such a nomination is revoked;
  • certain additional details of a largely administrative nature that are to be included in a controlling corporation's annual report;
  • additional information required in relation to the use of electricity that is produced from the operation of a facility;
  • expanding the Federal Government officers, employees and agencies to whom the Greenhouse and Energy Data Officer (GEDO) is entitled to disclose information provided to it by registered controlling corporations; and
  • the information required to be provided to the GEDO when applying for a declaration as to the activities that constitute a facility or the entity that has operational control over a facility.

The amendments to the NGER Regulations do not affect the validity of applications for registration that were made prior to the amendments coming into force.

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Registration

The streamlining of the registration requirements means that registration is now much simpler for corporations, especially where corporate groups consist of a large number of entities that do not have operational control over facilities. Previously, for example, a corporation with 100 group members would have needed to list each of those members in its application, together with each member's ABN. Now, that corporation will only have to list those group members that have operational control over a facility, or are undertaking, or propose to undertake, a greenhouse gas project, and will be able to provide other identifying details in the event that a group member does not have an ABN.

The has developed an online Registration Application Tool which corporations will need to use when preparing their application for registration. However, it is yet to be updated to reflect the changes made by the NGER Amendment Regulations. In addition, the forms required for joint ventures and partnerships to nominate a responsible entity for reporting purposes have not yet been approved, and so responsible entity nominations cannot be made.

Corporations should, if they have not done so already, consider whether they will be required to register by 31 August 2009.

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National Greenhouse and Energy Reporting Amendment Act 2008

The coming into force of the NGER Amendment Regulations coincides with the commencement of those provisions of the National Greenhouse and Energy Reporting Amendment Act 2008 (the NGER Amendment Act) that had not previously commenced. The relevant provisions relate to:

  • the definition of 'business unit';
  • applications for registration; and
  • the publication of information by the GEDO.

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National Greenhouse and Energy Reporting Amendment Bill 2009

The Department of Climate Change has released an exposure draft of the National Greenhouse and Energy Reporting Bill 2009 (the NGER Amendment Bill), which, if enacted in its current form, will expand the audit framework that is contained in the NGER Act, including by requiring auditors to register with the GEDO. In an unrelated amendment, the NGER Amendment Bill will also remove the obligation on the GEDO to publish energy production data on the basis that this may conflict with other publicly available energy production data and be potentially confusing.

If you would like further information in relation to the National Greenhouse and Energy Reporting Scheme, or assistance with preparing an application for registration under that Scheme, please contact any of the people below.

Published 1 April 2009

For further information, please contact:

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