‘Well-Designed’: Review Defends Australia’s Carbon Offset Scheme

A supplied image obtained on Nov. 27, 2020, of a wind farm at Granville Harbour in Tasmania, Australia. (AAP Image/Courtesy of Granville Harbour Wind Farm)

Australia’s carbon credit trading scheme, oft-accused of harbouring businesses attempting to circumvent environmental obligations, has been given the tick of approval by an independent review.

A six-month review led by scientist Ian Chubb, as well as three other leading scientists, said the scheme had been working effectively after 11 years of operation.

Carbon trading puts a price on emissions and allows landowners to trade “credits” that can determine how many emissions are produced.

The system has come under criticism, notably from Andrew Macintosh from the Australian National University, who published a report in March 2022 claiming the system was flawed and did not result in real cuts.

According to his team’s research, around 70 to 80 percent of the carbon credits being traded did not represent a genuine reduction in emissions.

“Unfortunately, Australia’s carbon market currently suffers from a distinct lack of environmental integrity,” Macintosh said in a statement.

“All of the major emission reduction methods have serious integrity issues, either in their design or the way they are being administered.”

However, on Jan. 9, Chubb’s team released their report disagreeing with Macintosh’s study’s claims.

“The [four-person] Panel does not share this view. While the Panel was provided with some evidence supporting that position, it was also provided with evidence to the contrary,” the report stated.

“There may be several reasons for the polar-opposite views. One is likely to be a lack of transparency, meaning that third parties cannot access the relevant data and so different conclusions can be drawn, and all genuinely held.”

Carbon Credit System “Fundamentally Well-Designed”

The Panel said the system was “fundamentally well-designed” but noted that after 11 years of operation, transparency of the scheme could be improved including lifting restrictions on data sharing.

The review also called for a “new body, differently constituted” to manage the scheme in the future, calling for more resourcing, noting there was “no practical or cheap alternative.”

Such a body would be tasked with helping the Labor government achieve a 43 percent reduction in emissions by 2030 and net zero by 2050—a goal that is currently being backed with billions of investments from federal and state governments around the country.

Current Climate Change Minister Chris Bowen said the federal government would adopt all 16 recommendations highlighted in the report.

“The Panel’s recommendations will help ensure Australia’s carbon crediting scheme has the highest integrity and contributes to achieving Australia’s emission targets,” he said.