Clean Energy Act 2011

Part 1—Preliminary

1 Short title

This Act may be cited as the Clean Energy Act 2011.

2 Commencement

(1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.

<table cellspacing="0" cellpadding="0" style="width:355.55pt; border-collapse:collapse"><thead><tr><td colspan="3" style="width:344.85pt; border-top:1.5pt solid #000000; border-bottom:0.75pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="TableHeading"><span>Commencement information</span></p></td></tr><tr><td style="width:81.45pt; border-top:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext" style="page-break-after:avoid"><span style="font-weight:bold">Column 1</span></p></td><td style="width:173.6pt; border-top:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext" style="page-break-after:avoid"><span style="font-weight:bold">Column 2</span></p></td><td style="width:68.4pt; border-top:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext" style="page-break-after:avoid"><span style="font-weight:bold">Column 3</span></p></td></tr><tr><td style="width:81.45pt; border-top:0.75pt solid #000000; border-bottom:1.5pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext" style="page-break-after:avoid"><span style="font-weight:bold">Provision(s)</span></p></td><td style="width:173.6pt; border-top:0.75pt solid #000000; border-bottom:1.5pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext" style="page-break-after:avoid"><span style="font-weight:bold">Commencement</span></p></td><td style="width:68.4pt; border-top:0.75pt solid #000000; border-bottom:1.5pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext" style="page-break-after:avoid"><span style="font-weight:bold">Date/Details</span></p></td></tr></thead><tbody><tr><td style="width:81.45pt; border-top:1.5pt solid #000000; border-bottom:0.75pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext"><span>1.</span><span> </span><span>Sections</span><span> </span><span>1 and 2 and anything in this Act not elsewhere covered by this table</span></p></td><td style="width:173.6pt; border-top:1.5pt solid #000000; border-bottom:0.75pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext"><span>The day this Act receives the Royal Assent.</span></p></td><td style="width:68.4pt; border-top:1.5pt solid #000000; border-bottom:0.75pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext"><span>18</span><span> </span><span>November 2011</span></p></td></tr><tr><td style="width:81.45pt; border-top:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext"><span>2.</span><span> </span><span>Sections</span><span> </span><span>3 to 303</span></p></td><td style="width:173.6pt; border-top:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext"><span>A single day to be fixed by Proclamation.</span></p><p class="Tabletext"><span>A Proclamation must not specify a day that occurs before the latest of:</span></p><p class="Tablea"><span>(a) the day the </span><span style="font-style:italic">Clean Energy Regulator Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(b) the day the </span><span style="font-style:italic">Clean Energy (Charges—Excise) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(c) the day the </span><span style="font-style:italic">Clean Energy (Charges—Customs) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(d) the day the </span><span style="font-style:italic">Clean Energy (Unit Issue Charge—Auctions) Act 2011</span><span> receives the Royal Assent;</span><span style="font-style:italic"> </span><span>and</span></p><p class="Tablea"><span>(e) the day the </span><span style="font-style:italic">Clean Energy (Unit Issue Charge—Fixed Charge) Act 2011</span><span> receives the Royal Assent;</span><span style="font-style:italic"> </span><span>and</span></p><p class="Tablea"><span>(f) the day the </span><span style="font-style:italic">Clean Energy (Unit Shortfall Charge—General) Act 2011</span><span> receives the Royal Assent;</span><span style="font-style:italic"> </span><span>and</span></p><p class="Tablea"><span>(g) the day the </span><span style="font-style:italic">Clean Energy (International Unit Surrender Charge) Act 2011 </span><span>receives the Royal Assent;</span><span style="font-style:italic"> </span><span>and</span></p><p class="Tablea"><span>(h) the day the </span><span style="font-style:italic">Clean Energy (Consequential Amendments) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(i) the day the </span><span style="font-style:italic">Clean Energy (Customs Tariff Amendment) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(j) the day the </span><span style="font-style:italic">Clean Energy (Excise Tariff Legislation Amendment) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(k) the day the </span><span style="font-style:italic">Clean Energy (Fuel Tax Legislation Amendment) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(l) the day the </span><span style="font-style:italic">Clean Energy (Household Assistance Amendments) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(m) the day the </span><span style="font-style:italic">Clean Energy (Income Tax Rates Amendments) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(n) the day the </span><span style="font-style:italic">Clean Energy (Tax Laws Amendments) Act 2011</span><span> receives the Royal Assent.</span></p><p class="Tabletext"><span>However, if the provision(s) do not commence within the period of 6 months beginning on the latest of:</span></p><p class="Tablea"><span>(o) the day this Act receives the Royal Assent; and</span></p><p class="Tablea"><span>(p) the day the </span><span style="font-style:italic">Clean Energy Regulator Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(q) the day the </span><span style="font-style:italic">Clean Energy (Charges—Excise) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(r) the day the </span><span style="font-style:italic">Clean Energy (Charges—Customs) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(s) the day the </span><span style="font-style:italic">Clean Energy (Unit Issue Charge—Auctions) Act 2011</span><span> receives the Royal Assent;</span><span style="font-style:italic"> </span><span>and</span></p><p class="Tablea"><span>(t) the day the </span><span style="font-style:italic">Clean Energy (Unit Issue Charge—Fixed Charge) Act 2011</span><span> receives the Royal Assent;</span><span style="font-style:italic"> </span><span>and</span></p><p class="Tablea"><span>(u) the day the </span><span style="font-style:italic">Clean Energy (Unit Shortfall Charge—General) Act 2011</span><span> receives the Royal Assent;</span><span style="font-style:italic"> </span><span>and</span></p><p class="Tablea"><span>(v) the day the </span><span style="font-style:italic">Clean Energy (International Unit Surrender Charge) Act 2011 </span><span>receives the Royal Assent;</span><span style="font-style:italic"> </span><span>and</span></p><p class="Tablea"><span>(w) the day the </span><span style="font-style:italic">Clean Energy (Consequential Amendments) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(x) the day the </span><span style="font-style:italic">Clean Energy (Customs Tariff Amendment) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(y) the day the </span><span style="font-style:italic">Clean Energy (Excise Tariff Legislation Amendment) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(z) the day the </span><span style="font-style:italic">Clean Energy (Fuel Tax Legislation Amendment) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(za) the day the </span><span style="font-style:italic">Clean Energy (Household Assistance Amendments) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(zb) the day the </span><span style="font-style:italic">Clean Energy (Income Tax Rates Amendments) Act 2011</span><span> receives the Royal Assent; and</span></p><p class="Tablea"><span>(zc) the day the </span><span style="font-style:italic">Clean Energy (Tax Laws Amendments) Act 2011 </span><span>receives the Royal Assent;</span></p><p class="Tabletext"><span>they commence on the day after the end of that period.</span></p></td><td style="width:68.4pt; border-top:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext"><span>2</span><span> </span><span>April 2012</span></p><p class="Tabletext"><span>(</span><span style="font-style:italic">see</span><span> F2011L02617)</span></p></td></tr><tr><td style="width:81.45pt; border-top:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext"><span>3.</span><span> </span><span>Sections</span><span> </span><span>303A and 303B</span></p></td><td style="width:173.6pt; border-top:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext"><span>The day after this Act receives the Royal Assent.</span></p></td><td style="width:68.4pt; border-top:0.75pt solid #000000; border-bottom:0.75pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext"><span>19</span><span> </span><span>November 2011</span></p></td></tr><tr><td style="width:81.45pt; border-top:0.75pt solid #000000; border-bottom:1.5pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext"><span>4.</span><span> </span><span>Sections</span><span> </span><span>304 to 312</span></p></td><td style="width:173.6pt; border-top:0.75pt solid #000000; border-bottom:1.5pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext"><span>At the same time as the provision(s) covered by table item</span><span> </span><span>2.</span></p></td><td style="width:68.4pt; border-top:0.75pt solid #000000; border-bottom:1.5pt solid #000000; padding-right:5.35pt; padding-left:5.35pt; vertical-align:top"><p class="Tabletext"><span>2</span><span> </span><span>April 2012</span></p></td></tr></tbody></table>

Note: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.

(2) Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act.

3 Objects

The objects of this Act are as follows: (a) to give effect to Australia’s obligations under: (i) the Climate Change Convention; and (ii) the Kyoto Protocol; (b) to support the development of an effective global response to climate change, consistent with Australia’s national interest in ensuring that average global temperatures increase by not more than 2 degrees Celsius above pre‑industrial levels; (c) to: (i) take action directed towards meeting Australia’s long‑term target of reducing Australia’s net greenhouse gas emissions to 80% below 2000 levels by 2050; and (ii) take that action in a flexible and cost‑effective way; (d) to put a price on greenhouse gas emissions in a way that: (i) encourages investment in clean energy; and (ii) supports jobs and competitiveness in the economy; and (iii) supports Australia’s economic growth while reducing pollution.

4 Simplified outline

The following is a simplified outline of this Act:

• This Act sets up a mechanism to deal with climate change by encouraging the use of clean energy.

• The mechanism begins on 1 July 2012, and operates on a financial year basis.

• The mechanism is administered by the Clean Energy Regulator.

• If a person is responsible for covered emissions of greenhouse gas from the operation of a facility, the facility’s annual emissions are above a threshold, and the person does not surrender one eligible emissions unit for each tonne of carbon dioxide equivalence of the gas, the person is liable to pay unit shortfall charge.

• If a natural gas supplier supplies natural gas, and does not surrender one eligible emissions unit for each tonne of carbon dioxide equivalence of the potential greenhouse gas emissions embodied in the natural gas, the supplier is liable to pay unit shortfall charge.

• If a person imports or produces liquefied petroleum gas or liquefied natural gas for non‑transport use, and does not surrender one eligible emissions unit for each tonne of carbon dioxide equivalence of the potential greenhouse gas emissions embodied in the liquefied petroleum gas or liquefied natural gas, the person is liable to pay unit shortfall charge.

• If a person opts in to the mechanism, the person acquires, manufactures or imports taxable fuel in specified circumstances, and does not surrender one eligible emissions unit for each tonne of carbon dioxide equivalence of the potential greenhouse gas emissions embodied in the fuel, the person is liable to pay unit shortfall charge.

• The financial years beginning on 1 July 2012, 1 July 2013 and 1 July 2014 are fixed charge years.

• Later financial years are flexible charge years.

• In a fixed charge year, carbon units will be issued under this Act for a fixed charge.

• In a flexible charge year, carbon units will be issued under this Act as the result of an auction.

• However, in the flexible charge years beginning on 1 July 2015, 1 July 2016 and 1 July 2017, some carbon units may be issued for a fixed charge (to act as a cap).

• Free carbon units will be issued under the Jobs and Competitiveness Program (which deals with emissions‑intensive trade‑exposed activities).

• Free carbon units will be issued to coal‑fired electricity generators.

• A carbon pollution cap limits the sum of:

(a) the total number of auctioned carbon units; and

(b) the total number of free carbon units issued in accordance with the Jobs and Competitiveness Program; and

(c) the total number of free carbon units issued to coal‑fired electricity generators.

• If a carbon unit was not issued for a fixed charge, the unit is transferable.

• The Climate Change Authority will conduct periodic reviews of this Act.

Note: Unit shortfall charge is imposed by whichever of the following is applicable:

(a) Part 3 of the Clean Energy (Charges—Excise) Act 2011;
(b) Part 3 of the Clean Energy (Charges—Customs) Act 2011;
(c) the Clean Energy (Unit Shortfall Charge—General) Act 2011.

5 Definitions

In this Act:

ABN has the same meaning as in the A New Tax System (Australian Business Number) Act 1999.

accept:

(a) accept the quotation of an OTN has the meaning given by section 59 or 60; and
(b) accept an own‑use notification has the meaning given by section 64D or 64E.

account number, in relation to a Registry account, has the same meaning as in the Australian National Registry of Emissions Units Act 2011.

acquire, in relation to a carbon unit, includes acquire by way of the issue of the unit.

applicable identification procedure has the meaning ascertained in accordance with the regulations.

appropriate energy market operator, in relation to a generation complex, means:

(a) if Australian Energy Market Operator Limited (ACN 072 010 327) performs the functions of the energy market operator in the place where the generation complex is located—Australian Energy Market Operator Limited; and
(b) if the Independent Market Operator established under the Electricity Industry (Independent Market Operator) Regulations 2004 of Western Australia performs the functions of the energy market operator in the place where the generation complex is located—the Independent Market Operator.

associated provisions means the following provisions:

(a) the provisions of the regulations;
(b) the provisions of the Clean Energy (Charges—Excise) Act 2011;
(c) the provisions of the Clean Energy (Charges—Customs) Act 2011;
(d) the provisions of the Clean Energy (Unit Issue Charge—Auctions) Act 2011;
(e) the provisions of the Clean Energy (Unit Issue Charge—Fixed Charge) Act 2011;
(f) the provisions of the Clean Energy (Unit Shortfall Charge—General) Act 2011;
(h) sections 15A, 15AA, 18A, 22A, 22AA, 22B, 22C, 22E and 22F of the National Greenhouse and Energy Reporting Act 2007;
(i) the remaining provisions of the National Greenhouse and Energy Reporting Act 2007, in so far as those provisions relate to:
(i) this Act; or
(ii) the regulations; or
(iii) the provisions covered by paragraph (h);
(j) sections 134.1, 134.2, 135.1, 135.2, 135.4, 136.1, 137.1 and 137.2 of the Criminal Code, in so far as those sections relate to:
(i) this Act; or
(ii) the regulations; or
(iii) the provisions of the National Greenhouse and Energy Reporting Act 2007 covered by paragraph (h) or (i).

Note: The provisions covered by paragraph (h) commence on 1 July 2012.

auction, when used in relation to a carbon unit, means a process that involves inviting persons to indicate or declare what they would be willing to pay by way of charge for the issue of the unit.

Australia, when used in a geographical sense, includes:

(a) in any case—the external Territories; and
(b) for the purposes of Part 3 (liable entities) and Part 7 (Jobs and Competitiveness Program)—the exclusive economic zone, the continental shelf and the Joint Petroleum Development Area.

Australian carbon credit unit has the same meaning as in the Carbon Credits (Carbon Farming Initiative) Act 2011.

Australian‑issued international unit has the same meaning as in the Australian National Registry of Emissions Units Act 2011.

average carbon unit auction price has the meaning given by section 196.

benchmark average auction charge has the meaning given by section 114.

biofuel has the same meaning as in the National Greenhouse and Energy Reporting Regulations 2008.

biogas has the same meaning as in the National Greenhouse and Energy Reporting Regulations 2008.

biomass has the same meaning as in the National Greenhouse and Energy Reporting Regulations 2008.

business day means a day that is not:

(a) a Saturday; or
(b) a Sunday; or
(c) a public holiday in the Australian Capital Territory.

carbon budget means the total amount of net Australian emissions of greenhouse gases during a specified period.

carbon dioxide equivalence:

(a) of an amount of greenhouse gas—has the same meaning as in the National Greenhouse and Energy Reporting Act 2007; or
(b) of an amount of potential greenhouse gas emissions embodied in an amount of designated fuel—has the same meaning as in the National Greenhouse and Energy Reporting Act 2007.

Note: See also section 311 (transitional).

carbon pollution cap has the meaning given by section 14, 17 or 18.

carbon pollution cap number has the meaning given by section 14, 17 or 18.

carbon unit means a unit issued under section 94.

certificate of eligibility for coal‑fired generation assistance means a certificate issued under section 165.

charge, in relation to the issue of a carbon unit, means whichever of the following is applicable:

(a) charge payable under subsection 100(10);
(b) charge payable under subsection 111(3);
(c) charge imposed by whichever of the following is applicable:
(i) Part 2 of the Clean Energy (Charges—Excise) Act 2011;
(ii) Part 2 of the Clean Energy (Charges—Customs) Act 2011;
(iii) the Clean Energy (Unit Issue Charge—Auctions) Act 2011;
(iv) the Clean Energy (Unit Issue Charge—Fixed Charge) Act 2011.

civil penalty order means an order under subsection 252(1).

civil penalty provision means:

(a) a provision of this Act that is declared by this Act to be a civil penalty provision; or
(b) a provision of a determination under subsection 113(1) that is declared by the determination to be a civil penalty provision.

Climate Change Convention means the United Nations Framework Convention on Climate Change, done at New York on 9 May 1992, as amended and in force for Australia from time to time.

Note: The text of the Convention is set out in Australian Treaty Series 1994 No. 2 ([1994] ATS 2). In 2011, the text of a Convention in the Australian Treaty Series was accessible through the Australian Treaties Library on the AustLII website (www.austlii.edu.au).

Commonwealth place has the same meaning as in the Commonwealth Places (Application of Laws) Act 1970.

Commonwealth Registry account has the same meaning as in the Australian National Registry of Emissions Units Act 2011.

compressed natural gas has the same meaning as in the National Greenhouse and Energy Reporting Regulations 2008.

constitutional corporation means a corporation to which paragraph 51(xx) of the Constitution applies.

controlling corporation has the same meaning as in the National Greenhouse and Energy Reporting Act 2007.

Note: See also section 311 (transitional).

corporate group transfer test has the meaning given by section 80.

covered emission from the operation of a facility has the meaning given by section 30.

dead organic matter does not include a fossil fuel.

declared designated joint venture has the meaning given by section 70.

decommissioned underground mine has the same meaning as in the National Greenhouse and Energy Reporting Regulations 2008.

designated, in relation to a Commonwealth Registry account, has the same meaning as in the Australian National Registry of Emissions Units Act 2011.

designated fuel means:

(a) natural gas; or
(b) taxable fuel; or
(c) liquefied natural gas; or
(d) liquefied petroleum gas.

designated joint venture, in relation to a facility, means:

(a) a joint venture that is a mandatory designated joint venture for the purposes of the application of this Act to the facility; or
(b) a joint venture that is a declared designated joint venture for the purposes of the application of this Act to the facility.

designated large landfill facility: a landfill facility is a designated large landfill facility in relation to an eligible financial year if the number of tonnes of the carbon dioxide equivalence of the total amount of covered emissions, legacy emissions and exempt landfill emissions from the operation of the landfill facility during the eligible financial year is 25,000 or more. For this purpose, assume that the financial year beginning on 1 July 2011 is an eligible financial year.

designated limit has the meaning given by section 123A.

designated limit percentage, in relation to a designated limit, has the meaning given by section 123A.

designated opt‑in person has the meaning given by the Opt‑in Scheme.

director includes a constituent member of a body corporate incorporated for a public purpose by a law of the Commonwealth, a State or a Territory.

electronic communication means a communication by means of guided and/or unguided electromagnetic energy.

electronic notice transmitted to the Regulator has the meaning given by section 7.

eligible Australian carbon credit unit means:

(a) a Kyoto Australian carbon credit unit (within the meaning of the Carbon Credits (Carbon Farming Initiative) Act 2011); or
(b) a non‑Kyoto Australian carbon credit unit (within the meaning of that Act) issued in relation to an eligible offsets project (within the meaning of that Act) for a reporting period (within the meaning of that Act), where:
(i) if it were assumed that the reporting period had ended before the Kyoto abatement deadline (within the meaning of that Act), a Kyoto Australian carbon credit unit would have been issued in relation to the project for the reporting period instead of the non‑Kyoto Australian carbon credit unit; and
(ii) the non‑Kyoto Australian carbon credit unit is not of a kind specified in the regulations; or
(c) an Australian carbon credit unit of a kind specified in the regulations.

Subparagraph (b)(ii) and paragraph (c) do not, by implication, limit the application of subsection 13(3) of the Legislative Instruments Act 2003 to other instruments under this Act.

eligible emissions unit means:

(a) a carbon unit; or
(b) an eligible international emissions unit; or
(c) an eligible Australian carbon credit unit.

eligible financial year means:

(a) the financial year beginning on 1 July 2012; or
(b) a later financial year.

eligible international emissions unit has the same meaning as in the Australian National Registry of Emissions Units Act 2011.

emissions intensity, in relation to a generation complex, has the meaning given by whichever of subsection 168(1) or (2) is applicable.

emissions number has the meaning given by section 118.

emissions number publication time of a person for an eligible financial year, means the time when the person’s emissions number for the eligible financial year is entered on the Information Database in accordance with subsection 185(2).

engage in conduct means:

(a) do an act; or
(b) omit to perform an act.

European allowance unit has the same meaning as in the Australian National Registry of Emissions Units Act 2011.

evidential burden, in relation to a matter, means the burden of adducing or pointing to evidence that suggests a reasonable possibility that the matter exists or does not exist.

excise duty has the same meaning as in the Excise Act 1901.

executive officer of a body corporate means:

(a) a director of the body corporate; or
(b) the chief executive officer (however described) of the body corporate; or
(c) the chief financial officer (however described) of the body corporate; or
(d) the secretary of the body corporate.

exempt landfill emissions, in relation to a landfill facility, has the meaning given by section 32A.

externally‑administered body corporate has the same meaning as in the Corporations Act 2001.

facility has the same meaning as in the National Greenhouse and Energy Reporting Act 2007.

Note: See also section 311 (transitional).

Federal Court means the Federal Court of Australia.

feedstock means a substance that is converted by a chemical process into another substance that is not a greenhouse gas.

financial control has the meaning given by section 92.

financial control transfer test has the meaning given by section 84.

fixed charge year means:

(a) the eligible financial year beginning on 1 July 2012; or
(b) the eligible financial year beginning on 1 July 2013; or
(c) the eligible financial year beginning on 1 July 2014.

flexible charge year means:

(a) the eligible financial year beginning on 1 July 2015; or
(b) a later eligible financial year.

follow‑up notification has the meaning given by section 64H.

foreign account, when used in relation to a carbon unit, means an account kept within a foreign registry.

foreign country includes a region where:

(a) the region is a colony, territory or protectorate of a foreign country; or
(b) the region is part of a foreign country; or
(c) the region is under the protection of a foreign country; or
(d) a foreign country exercises jurisdiction or control over the region; or
(e) a foreign country is responsible for the region’s international relations.

foreign person has the same meaning as in the National Greenhouse and Energy Reporting Act 2007.

foreign registry has the same meaning as in the Australian National Registry of Emissions Units Act 2011.

free carbon unit means a carbon unit issued free of charge.

fuel tax credit has the same meaning as in the Fuel Tax Act 2006.

fugitive emissions has the meaning given by the regulations.

gaseous fuel supplier means a person who supplies:

(a) liquefied natural gas; or
(b) liquefied petroleum gas; or
(c) natural gas.

generation complex means:

(a) a generation unit; or
(b) a set of 2 or more generation units at the same location.

generation unit means a generator of electricity, and includes:

(a) the boiler (if any); and
(b) any other related equipment essential to the generator’s functioning as a generator.

Greater Sunrise unit area has the same meaning as in the Offshore Petroleum and Greenhouse Gas Storage Act 2006.

greenhouse gas has the same meaning as in the National Greenhouse and Energy Reporting Act 2007.

Note: See also section 311 (transitional).

group has the same meaning as in the National Greenhouse and Energy Reporting Act 2007.

Note: See also section 311 (transitional).

GST group has the same meaning as in the Fuel Tax Act 2006.

GST joint venture has the same meaning as in the Fuel Tax Act 2006.

hold an eligible emissions unit: a person holds an eligible emissions unit if the person is the registered holder of the unit.

identification number, in relation to a carbon unit, has the meaning given by section 95.

Information Database means the Liable Entities Public Information Database kept under section 183.

inspector means a person appointed as an inspector under section 230.

interim emissions number has the meaning given by section 126.

international agreement means an agreement whose parties are:

(a) Australia and a foreign country; or
(b) Australia and 2 or more foreign countries.

international climate change agreement means:

(a) the Climate Change Convention; or
(b) any other international agreement, signed on behalf of Australia, that:
(i) relates to climate change; and
(ii) imposes obligations on Australia to take action to reduce greenhouse gas emissions; or
(c) an international agreement, signed on behalf of Australia, that:
(i) relates to climate change; and
(ii) is specified in a legislative instrument made by the Minister for the purposes of this definition.

issue, in relation to a carbon unit, means issue under section 94.

Jobs and Competitiveness Program means the program under subsection 145(1).

Joint Petroleum Development Area has the same meaning as in the Petroleum (Timor Sea Treaty) Act 2003.

joint venture means an unincorporated enterprise carried on by 2 or more persons in common otherwise than in partnership.

Kyoto Protocol means the Kyoto Protocol to the United Nations Framework Convention on Climate Change, done at Kyoto on 11 December 1997, as amended and in force for Australia from time to time.

Note: The text of the Kyoto Protocol is set out in Australian Treaty Series 2008 No. 2 ([2008] ATS 2). In 2011, the text of an international agreement in the Australian Treaty Series was accessible through the Australian Treaties Library on the AustLII website (www.austlii.edu.au).

Kyoto unit has the same meaning as in the Australian National Registry of Emissions Units Act 2011.

landfill facility means a facility for the disposal of solid waste as landfill, and includes a facility that is closed for the acceptance of waste.

large gas consuming facility has the meaning given by section 55A.

legacy emissions, in relation to a landfill facility, has the meaning given by section 32.

liability transfer certificate means a certificate issued under section 83 or 87.

liable entity means:

(a) a person who, under a provision of this Act, is a liable entity; or
(b) a person who, under the Opt‑in Scheme, is a liable entity.

liquefied natural gas has the same meaning as in the National Greenhouse and Energy Reporting Regulations 2008.

liquefied petroleum gas has the same meaning as in the National Greenhouse and Energy Reporting Regulations 2008. For this purpose, a reference in those regulations to liquid petroleum gas is to be read as a reference to liquefied petroleum gas.

liquid petroleum fuel has the same meaning as in the National Greenhouse and Energy Reporting Regulations 2008.

local governing body means a local governing body established by or under a law of a State or Territory.

mandatory designated joint venture has the meaning given by section 65.

member, in relation to a group, has the same meaning as in the National Greenhouse and Energy Reporting Act 2007.

Note: See also section 311 (transitional).

monitoring powers has the meaning given by section 233.

monitoring warrant means a warrant issued under section 245.

nameplate rating of a generation complex means:

(a) if the appropriate energy market operator is Australian Energy Market Operator Limited (ACN 072 010 327)—the maximum generation capacity in megawatts of the generation complex, most recently published by Australian Energy Market Operator Limited; and
(b) if the appropriate energy market operator is the Independent Market Operator established under the Electricity Industry (Independent Market Operator) Regulations 2004 of Western Australia—the maximum generation capacity in megawatts of the generation complex specified in a written determination made by the Regulator for the purposes of this paragraph.

In making a determination under paragraph (b), the Regulator may have regard to any information provided to the Regulator by the Independent Market Operator.

natural gas has the same meaning as in the National Greenhouse and Energy Reporting Regulations 2008.

natural gas supplier means a person who supplies natural gas.

natural gas supply pipeline does not include a pipeline of a kind specified in the regulations.

non‑group entity has the same meaning as in the National Greenhouse and Energy Reporting Act 2007.

Note: See also section 311 (transitional).

non‑transport combustion means combustion that does not occur in:

(a) an internal combustion engine in a motor vehicle; or
(b) an internal combustion engine in a vessel.

obligation transfer number or OTN means an OTN issued under section 40 or 41.

official of the Regulator has the same meaning as in the Clean Energy Regulator Act 2011.

open, in relation to a Registry account, has the same meaning as in the Australian National Registry of Emissions Units Act 2011.

operation, in relation to a facility, has the same meaning as in the National Greenhouse and Energy Reporting Act 2007.

Note: See also section 311 (transitional).

operational control has the same meaning as in the National Greenhouse and Energy Reporting Act 2007.

Note: See also section 311 (transitional).

Opt‑in Scheme means the scheme under subsection 92A(1).

OTN: see obligation transfer number.

OTN Register means the register kept under section 45.

own‑use notification has the meaning given by section 64C.

participant, in relation to a joint venture, means any of the persons who carry on the joint venture.

participating percentage has the meaning given by section 76 or 77.

participating percentage determination means a determination under section 76 or 77.

person means any of the following:

(a) an individual;
(b) a body corporate;
(c) a trust;
(d) a corporation sole;
(e) a body politic;
(f) a local governing body.

person assisting an inspector has the meaning given by section 234.

per‑tonne carbon price equivalent has the meaning given by section 196A.

potential greenhouse gas emissions has the same meaning as in the National Greenhouse and Energy Reporting Act 2007.

Note: See also section 311 (transitional).

power system reliability test has the meaning given by section 170.

premises includes the following:

(a) a structure, building, vehicle, vessel or aircraft;
(b) a place (whether or not enclosed or built on);
(c) a part of a thing referred to in paragraph (a) or (b).

Productivity Minister means the Minister administering the Productivity Commission Act 1998.

provisional emissions number:

(a) has the meaning given by Part 3 or the Opt‑in Scheme; and
(b) has a meaning affected by subsections 10(6) and (8) and sections 11B and 11C of the National Greenhouse and Energy Reporting Act 2007.

quarter means a period of 3 months beginning on 1 January, 1 April, 1 July or 1 October.

quote, in relation to an OTN, has the meaning given by section 48.

registered holder, in relation to an eligible emissions unit, means the person in whose Registry account there is an entry for the unit.

Registry means the Australian National Registry of Emissions Units continued in existence under the Australian National Registry of Emissions Units Act 2011.

Registry account has the same meaning as in the Australian National Registry of Emissions Units Act 2011.

Regulator means the Clean Energy Regulator.

relevant operator, when used in Division 5 of Part 3, has the meaning given by section 67A.

relinquish, in relation to a carbon unit, means relinquish under section 210.

Resources and Energy Minister means the Minister administering the Energy Efficiency Opportunities Act 2006.

reviewable decision has the meaning given by section 281.

scheme, when used in section 29 or Part 19, means:

(a) any agreement, arrangement, understanding, promise or undertaking, whether express or implied and whether or not enforceable, or intended to be enforceable, by legal proceedings; or
(b) any scheme, plan, proposal, action, course of action or course of conduct, whether there are 2 or more parties or only one party involved.

scope 1 emission of greenhouse gas has the meaning given by the National Greenhouse and Energy Reporting Act 2007.

Note: See also section 311 (transitional).

Secretary means the Secretary of the Department.

staff of the Regulator has the same meaning as in the Clean Energy Regulator Act 2011.

supply means supply (including re‑supply) by way of sale, exchange or gift.

Note 1: See also section 5A (special meaning of supply).

Note 2: See also section 6 (timing of supply).

surrender, in relation to an eligible emissions unit, means surrender under section 122.

taxable fuel has the same meaning as in the Fuel Tax Act 2006 (for this purpose, disregard paragraph (b) of the definition of taxable fuel in section 110‑5 of that Act).

transfer, in relation to a carbon unit, has the meaning given by section 104.

trust means a person in the capacity of trustee or, as the case requires, a trust estate.

trustee has the same meaning as in the Income Tax Assessment Act 1997.

trust estate has the same meaning as in the Income Tax Assessment Act 1997.

United Nations Convention on the Law of the Sea means the United Nations Convention on the Law of the Sea, done at Montego Bay on 10 December 1982.

Note: The text of the Convention is set out in Australian Treaty Series 1994 No. 31 ([1994] ATS 31). In 2011, the text of a Convention in the Australian Treaty Series was accessible through the Australian Treaties Library on the AustLII website (www.austlii.edu.au).

unit shortfall has the meaning given by section 125, 128, 129 or 133.

unit shortfall charge means charge imposed by whichever of the following is applicable:

(a) Part 3 of the Clean Energy (Charges—Excise) Act 2011;
(b) Part 3 of the Clean Energy (Charges—Customs) Act 2011;
(c) the Clean Energy (Unit Shortfall Charge—General) Act 2011.

vintage year, in relation to a carbon unit, means the eligible financial year that, in accordance with section 96, is the vintage year of the unit.

withdrawal, in relation to natural gas, has the meaning given by the regulations.

5A Special meaning of supply—natural gas

(1) The regulations may provide that supply, when used in relation to natural gas in: (a) section 35A; and (b) the definition of natural gas supplier in section 5 so far as that definition relates to section 35A; and (c) the remaining provisions of this Act so far as they relate to section 35A; and (d) the provisions of the National Greenhouse and Energy Reporting Act 2007 so far as they relate to section 35A of this Act; includes an act or a circumstance that, under the regulations, is taken to be a supply of natural gas. (2) The regulations may provide that supply, when used in relation to natural gas in: (a) section 35A; and (b) the definition of natural gas supplier in section 5 so far as that definition relates to section 35A; and (c) the remaining provisions of this Act so far as they relate to section 35A; and (d) the provisions of the National Greenhouse and Energy Reporting Act 2007 so far as they relate to section 35A of this Act; does not include an act or a circumstance that, under the regulations, is taken not to be a supply of natural gas. (3) For the purposes of this section, the following provisions are taken to relate to section 35A: (a) subsections 20(14) and (15); (b) subsections 21(8E) and (8F); (c) subsections 22(12) and (13); (d) subsections 23(9E) and (9F); (e) subsections 24(8E) and (8F); (f) subsections 25(7E) and (7F); (g) Divisions 4A and 4B of Part 3. (4) Regulations made for the purposes of subsection (1) or (2), in so far as they are relevant to the calculation of a preliminary emissions number, apply in relation to the calculation of a preliminary emissions number of a person for: (a) an eligible financial year specified in those regulations; or (b) a later eligible financial year. (5) An eligible financial year specified under paragraph (4)(a) must be later than the financial year in which the regulations are registered under the Legislative Instruments Act 2003.

6 When supply of natural gas occurs

(1) For the purposes of this Act, the supply of natural gas occurs: (a) if the regulations provide that the supply occurs when the gas passes a point ascertained in accordance with the regulations—when the gas passes that point; or (b) if: (i) paragraph (a) does not apply; and (ii) the supply involves physical delivery; when the gas is physically delivered. (2) The regulations may provide that, for the purposes of: (a) section 35A; and (b) the remaining provisions of this Act so far as they relate to section 35A; and (c) the provisions of the National Greenhouse and Energy Reporting Act 2007 so far as they relate to section 35A of this Act; the supply of natural gas occurs at the time ascertained in accordance with the regulations instead of at the time ascertained in accordance with subsection (1). (3) For the purposes of this section, the following provisions are taken to relate to section 35A: (a) subsections 20(14) and (15); (b) subsections 21(8E) and (8F); (c) subsections 22(12) and (13); (d) subsections 23(9E) and (9F); (e) subsections 24(8E) and (8F); (f) subsections 25(7E) and (7F); (g) Divisions 4A and 4B of Part 3. (4)

Regulations made for the purposes of subsection

(2), in so far as they are relevant to the calculation of a preliminary emissions number, apply in relation to the calculation of a preliminary emissions number of a person for:
(a) an eligible financial year specified in those regulations; or
(b) a later eligible financial year.

(5) An eligible financial year specified under paragraph (4)(a) must be later than the financial year in which the regulations are registered under the Legislative Instruments Act 2003.

7 Electronic notice transmitted to the Regulator

(1) For the purposes of this Act, a notice is an electronic notice transmitted to the Regulator if, and only if: (a) the notice is transmitted to the Regulator by means of an electronic communication; and (b) if the Regulator requires that the notice be transmitted, in accordance with particular information technology requirements, by means of a particular kind of electronic communication—the Regulator’s requirement has been met; and (c) the notice complies with regulations made for the purposes of subsection (2). (2) The regulations may make provision for or in relation to the security and authenticity of notices transmitted to the Regulator by means of an electronic communication. (3) Regulations made for the purposes of subsection (2) may deal with: (a) encryption; and (b) authentication of identity. (4) Subsection (3) does not limit subsection (2). (5) For the purposes of this Act, if a notice is transmitted to the Regulator by means of an electronic communication, the notice is taken to have been transmitted on the day on which the electronic communication is dispatched. (6) Subsection (5) of this section has effect despite section 14A of the Electronic Transactions Act 1999. (7) This section does not, by implication, limit the regulations that may be made under the Electronic Transactions Act 1999.

8 Crown to be bound

(1) This Act binds the Crown in each of its capacities. (2) This Act does not make the Crown liable to a pecuniary penalty or to be prosecuted for an offence. (3) The protection in subsection (2) does not apply to an authority of the Crown. (4) The protection in subsection (2) does not apply to a penalty under section 135, 212 or 213.

9 Extension to external Territories

This Act extends to every external Territory.

10 Extension to exclusive economic zone and continental shelf

This Act extends to a matter relating to the exercise of Australia’s sovereign rights in the exclusive economic zone or the continental shelf.

11 Extension to Joint Petroleum Development Area

This Act extends to the Joint Petroleum Development Area.

Note: See also sections 26 and 27 (adjustment of provisional emissions number).

12 Application to foreign ships

This Act does not apply to the extent that its application would be inconsistent with the exercise of rights of foreign ships in: (a) the territorial sea; or (b) the exclusive economic zone; or (c) waters of the continental shelf; in accordance with the United Nations Convention on the Law of the Sea.

Part 2—Carbon pollution cap

13 Simplified outline

The following is a simplified outline of this Part:

• The regulations may declare that:

(a) a quantity of greenhouse gas that has a carbon dioxide equivalence of a specified number of tonnes is the carbon pollution cap for a flexible charge year; and

(b) that number is the carbon pollution cap number for that flexible charge year.

Note: The carbon pollution cap limits the sum of:

(a) the total number of auctioned carbon units; and
(b) the total number of free carbon units issued in accordance with the Jobs and Competitiveness Program; and
(c) the total number of free carbon units issued in accordance with Part 8 (coal‑fired electricity generation).

14 Carbon pollution cap

Carbon pollution cap (1) The regulations may declare that: (a) a quantity of greenhouse gas that has a carbon dioxide equivalence of a specified number of tonnes is the carbon pollution cap for a specified flexible charge year; and (b) that number is the carbon pollution cap number for that flexible charge year. Regulations (2) In making a recommendation to the Governor‑General about regulations to be made for the purposes of this section, the Minister: (a) must have regard to Australia’s international obligations under international climate change agreements; and (b) must have regard to the most recent report that: (i) was given to the Minister by the Climate Change Authority under section 292; and (ii) dealt with carbon pollution caps and carbon budgets; and (c) may have regard to the following matters: (i) undertakings relating to the reduction of greenhouse gas emissions that Australia has given under international climate change agreements; (ii) Australia’s medium‑term and long‑term targets for reducing net greenhouse gas emissions; (iii) progress towards reduction of greenhouse gas emissions; (iv) global action to reduce greenhouse gas emissions; (v) estimates of the global greenhouse gas emissions budget; (vi) the economic and social implications associated with various levels of carbon pollution caps; (vii) voluntary action to reduce Australia’s greenhouse gas emissions; (viii) estimates of greenhouse gas emissions that are not covered by this Act; (ix) estimates of the number of Australian carbon credit units that are likely to be issued; (x) the extent (if any) of non‑compliance with this Act and the associated provisions; (xi) the extent (if any) to which liable entities have failed to surrender sufficient units to avoid liability for unit shortfall charge; (xii) any acquisitions, or proposed acquisitions, by the Commonwealth of eligible international emissions units; (xiii) such other matters (if any) as the Minister considers relevant.

15 Disallowance of regulations

Scope (1) This section applies to regulations made for the purposes of section 14. Disallowance (2) Either House of the Parliament may, following a motion upon notice, pass a resolution disallowing the regulations. For the resolution to be effective: (a) the notice must be given in that House within 15 sitting days of that House after the copy of the regulations was tabled in the House under section 38 of the Legislative Instruments Act 2003; and (b) the resolution must be passed, in pursuance of the motion, within 15 sitting days of that House after the giving of that notice. (3) If neither House passes such a resolution, the regulations take effect on the day immediately after the last day upon which such a resolution could have been passed if it were assumed that notice of a motion to disallow the regulations was given in each House on the last day of the 15 sitting day period of that House mentioned in paragraph (2)(a). (4) Section 42 (disallowance) of the Legislative Instruments Act 2003 does not apply to the regulations.

Note 1: The 15 sitting day notice period mentioned in paragraph (2)(a) of this section is the same as the 15 sitting day notice period mentioned in paragraph 42(1)(a) of the Legislative Instruments Act 2003.

Note 2: The 15 sitting day disallowance period mentioned in paragraph (2)(b) of this section is the same as the 15 sitting day disallowance period mentioned in paragraph 42(1)(b) of the Legislative Instruments Act 2003.

16 When regulations must be tabled

(1) The Minister must take all reasonable steps to ensure that a set of regulations that: (a) declares the carbon pollution cap, and the carbon pollution cap number, for the flexible charge year beginning on 1 July 2015; and (b) declares the carbon pollution cap, and the carbon pollution cap number, for each of the next 4 flexible charge years; is tabled in each House of the Parliament under section 38 of the Legislative Instruments Act 2003 not later than 31 May 2014. (2) A set of regulations covered by subsection (1) must not be made, or tabled in a House of the Parliament, after 31 May 2014. (3) If, at the start of the month of May that is 14 months before the start of a particular flexible charge year beginning on or after 1 July 2016, no regulations made for the purposes of section 14 have previously taken effect, the Minister must take all reasonable steps to ensure that a set of regulations that: (a) declares the carbon pollution cap, and the carbon pollution cap number, for the flexible charge year; and (b) declares the carbon pollution cap, and the carbon pollution cap number, for each of the next 4 flexible charge years; is tabled in each House of the Parliament under section 38 of the Legislative Instruments Act 2003 not later than the end of that May. (4) A set of regulations covered by subsection (3) must not be made, or tabled in a House of the Parliament, after the end of the May mentioned in that subsection. (5) If a set of regulations that: (a) declares the carbon pollution cap, and the carbon pollution cap number, for a particular flexible charge year; and (b) declares the carbon pollution cap, and the carbon pollution cap number, for each of the next 4 flexible charge years; has taken effect, the Minister must take all reasonable steps to ensure that: (c) regulations declaring the carbon pollution cap, and the carbon pollution cap number, for the flexible charge year (the relevant flexible charge year) next following the last flexible charge year covered by paragraph (b) are tabled in each House of the Parliament under section 38 of the Legislative Instruments Act 2003 at least 5 years before the end of the relevant flexible charge year; and (d) regulations declaring the carbon pollution cap, and the carbon pollution cap number, for a flexible charge year that is later than the relevant flexible charge year are tabled in each House of the Parliament under section 38 of the Legislative Instruments Act 2003 at least 5 years before the end of the later flexible charge year. (6) Regulations covered by paragraph (5)(c) must not be made, or tabled in a House of the Parliament, after the start of the 5‑year period mentioned in that paragraph. (7) Regulations covered by paragraph (5)(d) must not be made, or tabled in a House of the Parliament, after the start of the 5‑year period mentioned in that paragraph. (8) If: (a) either: (i) a set of regulations covered by subsection (1) or (3) is made; or (ii) regulations covered by paragraph (5)(c) or (d) are made; and (b) on a particular day (the tabling day), a copy of the regulations is tabled in a House of the Parliament under section 38 of the Legislative Instruments Act 2003; then, on or as soon as practicable after the tabling day, the Minister must cause to be tabled in that House a written statement setting out the Minister’s reasons for making the recommendation to the Governor‑General about those regulations.

17 Default carbon pollution cap for 2015‑16

Scope (1) This section applies if there are no regulations in effect that declare the carbon pollution cap, and the carbon pollution cap number, for the flexible charge year beginning on 1 July 2015. Carbon pollution cap (2) The carbon pollution cap for the flexible charge year is a quantity of greenhouse gas that has a carbon dioxide equivalence of a number of tonnes equal to the number worked out using the following formula: View image in the official source where:

total emissions numbers for the eligible financial year beginning on 1 July 2012 means the estimate entered in the Information Database under section 186 in relation to the eligible financial year beginning on 1 July 2012.

Carbon pollution cap number (3) The number worked out using that formula is the carbon pollution cap number for the flexible charge year.

18 Default carbon pollution cap for a later flexible charge year

Scope (1) This section applies if there are no regulations in effect that declare the carbon pollution cap, and the carbon pollution cap number, for a particular flexible charge year beginning on or after 1 July 2016. Carbon pollution cap (2) The carbon pollution cap for the flexible charge year is a quantity of greenhouse gas that has a carbon dioxide equivalence of a number of tonnes equal to the number worked out using the following formula: View image in the official source Carbon pollution cap number (3) The number worked out using that formula is the carbon pollution cap number for the flexible charge year.