National Greenhouse and Energy Reporting Amendment Regulations 2011 (No. 2)

Administered by Department of Climate Change and Energy Efficiency

Legislation au F2011L02584 Regulations Not in force Legislative Instrument

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EXPLANATORY STATEMENT

Select Legislative Instrument 2011 No. 269

Issued by the Authority of the Minister for Climate Change and Energy Efficiency
National Greenhouse and Energy Reporting Act 2007
National Greenhouse and Energy Reporting Amendment Regulations 2011 (No. 2)

Section 77 of the National Greenhouse and Energy Reporting Act 2007 (the NGER Act) provides, in part, that the Governor-General may make regulations prescribing matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act.

The NGER Act establishes the National Greenhouse and Energy Reporting System, which is a national framework for reporting greenhouse gas emissions, greenhouse gas projects and energy consumption and production by Australian corporations.

Subsection 75A(1) of the NGER Act provides for the Greenhouse and Energy Data Officer (the GEDO) to maintain a register of greenhouse and energy auditors. Subsection 75A(2) provides that the GEDO must register individuals who have applied for registration in accordance with regulations made under subsection 75A(5), and who meet the requirements prescribed in regulations made for paragraph 75A(2)(b) or in a legislative instrument made under the regulations in accordance with subsection 75A(4). Regulations dealing with audits were inserted into the National Greenhouse and Energy Reporting Regulations 2008 (the Principal Regulations) by the National Greenhouse and Energy Reporting Amendment Regulations 2009 (No. 2).

Section 75A of the NGER Act was amended by the Carbon Credits (Consequential Amendments) Act 2011 to allow the audit framework for the Carbon Credits (Carbon Farming Initiative) Act 2011 (the CFI Act) to utilise the existing NGER audit framework. The effect of this amendment is that the register of greenhouse and energy auditors kept under section 75A of the NGER Act will list auditors for the purpose of both the NGER Act and the CFI Act.

The National Greenhouse and Energy Reporting Amendment Regulations 2011 (the Regulations) support the amendments by extending existing provisions relating to greenhouse and energy auditors to CFI audits.

The sections of the NGER Act which enable the Regulations are set out in Attachment A.

Details of the Regulations are set out in Attachment B.

Consultation

The amendments are mechanical in nature and are primarily aimed at implementing Parliament’s decision to bring CFI audits within the existing NGER framework. These amendments do not alter reporting requirements. Given the extensive consultation on the primary legislation and consequential nature of the amendments, further specific consultation was not conducted.

The amendments relating to CFI audits are intended to be read in conjunction with the National Greenhouse and Energy Reporting (Audit) Determination 2009 and the National Greenhouse and Energy Reporting (Auditor Registration) Instrument 2009, both of which will be amended in relation to CFI audits. Consultation will be undertaken in relation to those amendments. 

 

Authority: Section 77 of the National Greenhouse and Energy Reporting Act 2007


Attachment A

Sections of the NGER Act supporting the Regulations

The Regulations are supported by the following provisions of the NGER Act:

  • subsection 26(1), which allows the regulations to specify persons for the purpose of disclosing greenhouse and energy information;
  • paragraph 75A(2)(b), which allows the regulations to set out requirements as to qualifications, knowledge, expertise, competence, independence and other matters of individuals who apply to be included in the register of greenhouse and energy auditors;
  • paragraph 75A(5)(a), which allows the regulations to provide for the form and content of the register;
  • paragraph 75A(5)(b), which allows the regulations to provide for publication of the register;
  • paragraph 75A(5)(c), which allows the regulations to provide for the form and content of applications for registration and the manner in which applications are to be made;
  • paragraph 75A(5)(e), which allows the regulations to provide for requirements to be met to maintain registration;
  • paragraph 75A(5)(f), which allows the regulations to provide for review of registration;
  • paragraph 75A(5)(g), which allows the regulations to provide for suspension of registration in prescribed circumstances;
  • paragraph 75A(5)(h), which allows the regulations to provide for deregistration in prescribed circumstances;
  • paragraph 75A(5)(i), which allows the regulations to provide for inspection of the performance of registered greenhouse and energy auditors in carrying out greenhouse and energy audits; and
  • section 77, which allows the Governor-General to make regulations prescribing matters required or permitted by the NGER Act to be prescribed and matters necessary or convenient to be prescribed for carrying out or giving effect to the NGER Act.


Attachment B

Details of the Regulations

Amendments relating to CFI audits

The Principal Regulations are amended by extending the existing provisions relating to greenhouse and energy auditors to CFI audits.

In particular, existing provisions relating to:

  • the content and publication of the register of greenhouse and energy auditors (Division 6.3 of the Principal Regulations) [items 13-17 of Schedule 1];
  • the requirements as to qualifications, status as a fit and proper person and the knowledge and experience that an individual must meet to be registered (Division 6.4 of the Principal Regulations) [items 18-19 of Schedule 1];
  • the registration of registered greenhouse and energy auditors (Division 6.5 of the Principal Regulations) [items 20-29 of Schedule 1]; and
  • the requirements to be met to maintain registration (Division 6.6 of the Principal Regulations) [items 30-56 of Schedule 1];

are amended so that they extend to an audit under sections 214 or 215 of the CFI Act, or an audit carried out for the purposes of preparing an audit report prescribed for the purposes of paragraphs 13(1)(e), 23(1)(d) or 76(4)(c) of the CFI Act (a CFI audit).

Consequential amendments are also made to the categories of registered greenhouse and energy auditors. The Principal Regulations recognise 3 categories of auditors, with category 1 auditors classified as either technical or non-technical. The amendments made by items 14-21 of Schedule 1 of the Regulations will allow for differentiation between NGER technical and CFI technical category 1 auditors. Greenhouse gas accounting in the land sector has a particular set of issues and challenges which need to be understood for a CFI audit to be able to be effectively undertaken. This amendment recognises the need for specialist CFI auditors who have experience in and understanding of land sector greenhouse gas accounting.

Auditors will be required to have knowledge of the legislation relevant to the category of auditor for which they have applied. That is, a category 1 CFI technical applicant will require knowledge of the CFI legislation, while a category 1 NGER technical applicant will require knowledge of the NGER legislation. A category 2 applicant will require knowledge of both sets of legislation only if they intend to work on both NGER and CFI audits.

Amendments relating to disclosure of greenhouse and energy information

Subsection 26(1) of the NGER Act allows the disclosure of greenhouse and energy information to a Commonwealth Minister, a Secretary of a Department or an APS employee where the person:

  • is responsible for administering a program or collecting statistics relating to greenhouse gas emissions, energy consumption or energy production; and
     
  • is specified in the Principal Regulations.

The disclosure provisions in the Principal Regulations are amended to allow disclosure of greenhouse and energy information to the Treasurer, the Secretary of the Treasury and officers of the Treasury. This ensures that these persons are able to access and use historical data collected under the NGER Act [items 9-12 of Schedule 1]. The intent of this provision is to allow information to be disclosed for purposes relevant to the Energy Security Council, which the Government announced in its Clean Energy Future Plan. The Energy Security Council will provide advice to the Treasurer on policy instruments available to address energy security risks.

 

Overview

The National Greenhouse and Energy Reporting Amendment Regulations 2011 (No. 2) were enacted to address the need for integrating the audit frameworks for the National Greenhouse and Energy Reporting Act 2007 (NGER Act) and the Carbon Credits (Carbon Farming Initiative) Act 2011 (CFI Act). These regulations, issued by the Minister for Climate Change and Energy Efficiency, were made under the authority of section 77 of the NGER Act, which allows for the creation of regulations necessary for the implementation of the Act. The policy objective behind these regulations is to streamline the auditing processes under both Acts, leveraging the existing infrastructure of the NGER Act for the CFI Act, thereby ensuring consistency and efficiency in the auditing of greenhouse gas emissions and energy consumption across both legislative frameworks. These amendments extend the provisions related to the registration and regulation of greenhouse and energy auditors under the NGER Act to also apply to the CFI Act, facilitating a unified approach to audit requirements. This integration aims to maintain the integrity and effectiveness of the auditing processes while reducing redundancy and administrative burdens. The regulations also adjust the categories of auditors to distinguish between those with expertise in the land sector, which is critical for the accurate auditing of greenhouse gas accounting under the CFI Act. Additionally, the regulations modify the disclosure provisions to include the Treasurer, the Secretary of the Treasury, and officers of the Treasury, enabling them to access necessary data for policy and strategic decision-making related to energy security.

Scope and Application

The National Greenhouse and Energy Reporting Amendment Regulations 2011 (No. 2) extends the existing provisions of the National Greenhouse and Energy Reporting Regulations 2008 to encompass audits under the Carbon Credits (Carbon Farming Initiative) Act 2011. This regulation applies to Australian corporations mandated to report greenhouse gas emissions, energy consumption, and production, as well as to individuals who seek to be registered as greenhouse and energy auditors under the National Greenhouse and Energy Reporting Act 2007. The expanded audit framework ensures that auditors must possess the necessary qualifications, knowledge, and expertise to conduct both National Greenhouse and Energy Reporting Act and Carbon Credits (Carbon Farming Initiative) Act audits. Auditors are required to demonstrate an understanding of the relevant legislation pertinent to the type of audit they intend to perform, whether it be National Greenhouse and Energy Reporting or Carbon Farming Initiative. This includes distinguishing between technical and non-technical auditors, with a specific emphasis on those auditors working in the land sector for Carbon Farming Initiative audits. The regulations also facilitate the disclosure of greenhouse and energy information to the Treasurer, the Secretary of the Treasury, and officers of the Treasury, thereby enabling these individuals to access historical data for policy-making purposes, particularly in relation to energy security.

Key Provisions

The National Greenhouse and Energy Reporting Amendment Regulations 2011 (No. 2) extend the existing framework for greenhouse and energy auditors to include auditors for the Carbon Credits (Carbon Farming Initiative) Act 2011. The key provisions of these regulations are outlined in Divisions 6.3 to 6.6 of the National Greenhouse and Energy Reporting Regulations 2008, which detail the content and publication of the register of greenhouse and energy auditors, the qualifications and knowledge required for registration, the registration process itself, and the requirements for maintaining registration. These provisions are now applicable to audits conducted under the Carbon Credits (Carbon Farming Initiative) Act 2011, thereby integrating the audit framework for the Carbon Farming Initiative within the existing National Greenhouse and Energy Reporting System. These regulations impose several obligations on the parties they govern. Firstly, they mandate that individuals applying for registration as greenhouse and energy auditors must meet specific qualifications, knowledge, expertise, and independence requirements prescribed in the regulations or in a legislative instrument made under the regulations. These requirements are tailored to ensure that auditors possess the necessary skills and understanding to conduct effective audits, particularly in the context of the Carbon Farming Initiative, which involves unique challenges in land sector greenhouse gas accounting. Secondly, the regulations stipulate the procedures for registering, maintaining, reviewing, and potentially suspending or deregistering auditors. Auditors must also be knowledgeable about the relevant legislation for the category of auditor for which they have applied, with additional requirements for those intending to work on both National Greenhouse and Energy Reporting and Carbon Farming Initiative audits. Breaches of the regulations may lead to various consequences. While the explanatory statement does not specify particular offences or penalties, it is reasonable to infer that non-compliance with the registration requirements or failure to maintain the standards of competence and independence could result in suspension or deregistration from the register of greenhouse and energy auditors. Such actions could have significant implications for an auditor’s ability to conduct audits under both the National Greenhouse and Energy Reporting Act 2007 and the Carbon Credits (Carbon Farming Initiative) Act 2011, potentially affecting their professional standing and career. Given the regulatory nature of the Act and the critical role of auditors in ensuring the integrity of greenhouse gas reporting, penalties for non-compliance could include fines and other administrative sanctions as prescribed under the relevant legislation.

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