Carbon market participants refute ‘sensational’ accusations

Beef Central, 28/03/2022

RECENT accusations against Australia’s carbon market regulatory framework have been “sensationalised and risk undermining a world leading framework for carbon credit generation and review” the Carbon Market Institute claims in a statement issued this week.

The Institute’s chief executive John Connor said it was “vital we continue to support Australia’s carbon crediting framework, which has had long-running bi-partisan support, at a time when climate action needs to be accelerated.”

His comments came after a former advisor to Emissions Reduction Fund labelled the system a “fraud” in an interview on ABC’s 7.30 program (click here to view earlier report).

Professor Andrew Macintosh from the Australian National University raised his concerns, saying there was serious concern about the integrity of some of Australia’s carbon credit methods.

In response this week, CMI said it had commissioned a report to explain the different elements of integrity that are enshrined within Australia’s carbon scheme.

In the meantime, the institute has made the following points:

  • All methodologies are required to have regard to legislated offset integrity standards, which include that only abatement activity that would not ordinarily have happened is credited and that any abatement credited is conservative
  • Method development is subject to extensive consultation with technical experts and broader stakeholders
  • There is an independent process of review for new methodologies and the ability for existing methodologies to be reviewed at any time if there are concerns about whether they still comply with the legislated offset integrity standards
  • Projects cannot be registered unless they comply with the requirements of a methodology
  • Claims for issuances of Australian Carbon Credit Units (ACCUs) are regularly audited by independent, third-party auditors
  • ACCUs are regulated as financial products under corporation law and there are licensing requirements for those who deal in ACCUs or provide financial advice about them

“Sensational claims of ‘fraud, rorts and sham’ amount to a direct attack on a vast network of farmers, traditional owners, service providers, investors, auditors, conservationists and public servants – many of whom have spent the last decade striving to accelerate support for stronger industrial emission reduction, sustainable agriculture and reversal of deforestation,” the CMI statement said.

“Many of these participants are feeling aggrieved by accusations which do not appear to be substantiated by the academic papers.”

CMI said the organisation and its members were analysing the technical papers released late last week, which it understood were pending peer review.

The Institute plans to put out a comprehensive response later this week.

“However, the land management papers for example, don’t back up claims that 70-80pc of Australian Carbon Credit Units are ‘devoid of integrity’,” it said.

The papers focused on the Human Induced Regeneration (HIR) methodology appeared to confuse principles under the methodology which is aimed at crediting transition to forest cover, not current forest levels, CMI said.

“The transition to forest cover is closely regulated, including five-yearly regeneration checks, and a 15 year forest cover attainment check. The papers also understate additional requirements made in 2019 to the HIR methodology which were designed to improve integrity of these projects,” it said.

CMI said it and its members were committed to continuous improvement of Australia’s carbon market, and welcomed proposals for ongoing improvement in methods, additionality, transparency and governance.

“Through its Landscape Taskforce, CMI has for some time been raising the importance of improved national data-sharing frameworks that would improve transparency.

“Governance systems of separation of power and firewalls should be and are regularly reviewed and should avoid perceptions and reality of conflict of interests,” it said.

“These are important issues to get right, but we cannot lose sight of the critical role for carbon markets and crediting of abatement activity as an important tool for an efficient and cost-effective transition to net zero emission economies.”

“CMI stands ready to participate in any independent review or other processes necessary to enable the investments and reforms necessary to address our twin climate and biodiversity crises,” Mr Connor said.


  • The Carbon Market Institute is the independent industry association for business leading the transition to net zero emissions. Its 130+ members include primary producers, carbon service providers, Indigenous corporations, legal, technology and advisory services, insurers, banks, investors, corporate entities and emission intensive industries developing decarbonisation and offset strategies.




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  1. Tony Gleeson, 28/03/2022

    There are several important governance issues embedded in both the reported response of the Carbon Market Institute to concerns about the integrity of Government recognised carbon sequestration and in this report of those concerns. However, my comment is restricted to a single issue, that being the need for policies and processes that enable, protect and respect contributions from academics and other public intellectuals, particularly when the foci of those contributions have significant public good consequences.
    My knowledge base is largely restricted to the agri-ecological domain. It is based on experience in agricultural practice, policy, and political analysis and on having been a Director of an R&D Corporation, having been employed by an R&D Corporation and having done tens of projects over three decades across the breadth of organisations responsible for the funding and execution of agricultural and environmental R&D. My concern is that we have evolved agricultural and related institutional arrangements that constrain contributions such as those referred to above. The problem arises from the reinforcing potency of many factors prominent ones being:
    • The narrowly conceived composition of advisory and decision-making bodies, usually excluding independent community representation
    • The excessive influence of vested interests in the allocation of public funding
    • An imbalance between competitively allocated funding and on-going base funding
    • An excessive use of short-term employment arrangements
    • Direct politically motivated interference from government and industry

    These are not esoteric matters. Their proper consideration is important to the resilience of farmers and communities more broadly.

    • Natalie Williams, 29/03/2022

      There is a platform to raise issues about the integrity of carbon and carbon methods and its not broad-scale slanderous commentary on mainstream media. Your reference to “independent community representation” can be done via the Carbon Market Institute (CMI) which represents the entire sector.
      My experience with the CMI has been exemplary. They have enabled me to participate in forums, working groups and taken my comments/suggestions seriously.
      My experience with the regulators (CER, ERF& LRF) has been helpful and informative also. They are serious about making the processes and systems work better for all concerned.
      The ridiculous commentary on the ABC last week sounds like sour grapes to me with individuals pedaling their own agenda and trying to position themselves at the expense of the millions of hours of work undertaken by scientists, developers and farmers for nearly 2 decades. Having traveled internationally for 2 years researching and studying carbon markets, carbon trading and carbon methods, Australia can be proud of its position in creating some of the worlds best practices and scientific rigour for carbon credits and processes. Carbon methods are constantly being refined and improved as you well know. The nascent nature of the carbon/natural capital sector and the fast evolution of methods is part of the process…to keep pace with the changing needs of international protocols there needs to be an overarching governance structure such as the CMI to marshal concerns and complaints.
      Feedback from my network over the past week is unanimously concerned about the damage being done to the advancement of carbon farming and for that those responsible for the unfounded commentary should be held to account.

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