The Australian Government’s controversial $4.5 billion Emissions Reduction Fund (ERF) has today come under renewed calls for a root-and-branch review.
The call comes following revelations by the former chair of the Australian Government’s Emissions Reduction Assurance Committee that up to 80% of Australian carbon credits lack integrity.
A new research report, launched today by the Australia Institute at the Smart Energy Conference, highlights the risks to any government relying on the ERF in their Net Zero plans
- The ERF has failed to reduce Australia’ emissions, with evidence showing that it is in fact facilitating increased emissions.
- Over half the $4.5 billion fund has already been committed to purchase of just 217 million tonnes abatement (less than half of Australia’s annual emissions) since 2015.
- The CEO of Qantas has endorsed a review and the ACCC and ASIC have flagged the need for tighter regulation on carbon credits greenwashing
- Efforts to rapidly expand the ERF since 2020 has led to disproportionate industry influence:
- Over 80 % of existing ACCUs have been found to be low integrity.
- There is no evidence that new carbon credit methods such as carbon capture and storage and soil carbon will have integrity.
- Third parties participating in the scheme in good faith, including buyers of carbon credits, landholders and
- Indigenous communities, are being placed at risk by the government’s failure to address long-standing concerns.
- The ERF requires a fully independent review to restore confidence in Australia’s carbon credits and ensure it is fit for purpose.
- A review of the ERF requires clarification of its role in Australia’s climate policy, along with an assessment of its carbon credit methods and governance.
“Carbon credits with integrity have a role to play in reducing our emissions in genuinely hard-to-abate areas of the economy, like agriculture. But dodgy credits used as offsets are effectively a licence to pollute, fuelling climate change,” said Ben Oquist, Executive Director of the Australia Institute.
“Australia’s only legislated climate policy, the controversial $4.5 billion dollar Emission Reduction Fund, is being undermined by poor regulation and the influence of industry.
“Instead of using public money to cut pollution, the Emissions Reduction Fund has become a ready source of affordable, low-quality offsets for high-polluting industries. Now is the time to correct this decline.
“We need an urgent review of climate policy in Australia to restore integrity to the Emissions Reduction Fund, otherwise we risk wasting billions more of taxpayer dollars on hot air – that is, useless credits that don’t lower emissions.
“Integrity must underpin Australia’s climate actions and policies. We can’t afford to waste the next decade like we have the last one.”