Ember urges the Department to set international best practice benchmarks, for new coal mine facilities under the safeguard mechanism, primarily on the basis of whether the benchmark is compatible with Australia’s climate targets and the objects enshrined under the National Greenhouse and Energy Reporting Act 2007 (Cth) (NGER Act). As such, Ember recommends against using only a comparison between foreign facilities and the domestic industry to determine international best practice benchmarks, as is currently anticipated by the Safeguard Mechanism: International Best Practice Benchmarks consultation.
Instead, international best practice benchmarks should be consistent with the international consensus that coal mine methane emissions must be reduced significantly this decade to comply with a 1.5 degree pathway. Ember therefore recommends that the run-of-mine coal production variable should be set at net zero for new coal facility entrants to the safeguard mechanism, that is, 0 CO2-e per tonne of run-of-mine coal. This is not beyond scope for new coal entrants, given the government has already committed to net zero or zero baselines for other facilities including new shale gas projects.
The Safeguard Mechanism: Production Variables Update consultation was in relation to the Australian government’s proposal to impose a proposed production variable of 0.0653 of CO2-e per tonne of run-of-mine coal for existing safeguard coal facilities. This production variable would inform the greenhouse gas emissions baseline that safeguard facilities must comply with under the safeguard mechanism.
Ember is of the opinion that the proposed production variable is appropriate and should incentivise significant emissions reductions at Australia’s most methane intense coal facilities, leading to an overall decrease in Australia’s coal mine methane emissions. However, we have ongoing concerns that carbon crediting benefits to some coal facilities, namely open cut coal facilities, will undermine efforts to achieve emissions reductions at those particular facilities.