3. Legislative and Policy Context 3.1. International Context 3.1.1. United Nations Framework Convention on Climate Change (UNFCCC)
The United Nations Framework Convention on Climate Change (UNFCCC) is an international treaty that provides the foundation for global cooperation to address climate change, including commitments to reduce GHG emissions. As a Party to the UNFCCC since 1992, Australia is required to report its emissions, implement national climate policies, and contribute to international negotiations under the Convention. Through this framework, Australia became a participant in the Paris Agreement. 3.1.2. Paris Agreement (PA) The Paris Agreement was established in 2015, ratified by Australia in 2016, and is the legally binding international treaty on climate change that contains commitments for countries to reduce GHG emissions to limit global warming to ‘well below’ 2°C and, if possible, to 1.5°C (UNFCCC, 2015). Additionally, the agreement calls for the removal of GHG emissions, aiming to reach net-zero emissions in the second half of the century. 3.2. Legislation and Regulations 3.2.1. Climate Change Act 2022 The Climate Change Act 2022 formally sets Australia’s GHG reduction target to 43% below 2005 levels by 2030 and net zero by 2050, in line with reduction targets under the Paris Agreement. While this act does not directly impose obligations on companies, it provides the legislative foundation for policies that expand and align national GHG reporting requirements. 3.2.2. National Greenhouse and Energy Reporting Act 2007 The National Greenhouse and Energy Reporting Act 2007 (NGER Act) provides a framework for reporting on GHG emissions, energy consumption and energy production. Companies that meet the NGER scheme thresholds of 25,000 tonnes CO 2 -e per annum for a facility, or 50,000 tonnes CO 2 -e per annum for a corporation, are required to register and report on their GHG emissions annually. 3.2.3. National Greenhouse and Energy Reporting (Measurement) Determination 2008 The National Greenhouse and Energy Reporting (Measurement) Determination (NGER, 2008) outlines methods, criteria, and standards for calculating greenhouse gas emissions and energy usage under the NGER Act. It contains methods for calculating Scope 1 and Scope 2 emissions and is updated annually. The NGER Act also provides a framework for Australia’s highest emitters to manage and report on their GHG emission: the Safeguard Mechanism. 3.2.4. Safeguard Mechanism The Safeguard Mechanism applies to facilities that emit over 100,000 tonnes CO 2 -e annually (as Scope 1 emissions). This framework requires high emitting facilities to keep their emissions at or below emissions baselines set by the Clean Energy Regulator (CER). Projects that feed into, or become, regulated facilities under this regime must account for projected emissions against baselines and planned operational trajectories.
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