Climate Change Regulations 2017

Baseline year (2005). The Act requires a figure representing the State’s greenhouse gas emissions for 2005 as a reference point. The regulations do not assign a single legislated number; instead they prescribe an aggregation method: add the carbon dioxide equivalent emission figures for each sector from the Commonwealth’s State and Territory Greenhouse Gas Inventories. Because the regulation references the inventories as published from time to time, any revision to the Commonwealth methodology for estimating historical emissions retrospectively changes the baseline. This is a form of dynamic incorporation that removes the figure from direct legislative or ministerial determination.

Carbon dioxide equivalent (CO2-e). The Act uses a formula to calculate emissions reductions. Variable B is the carbon dioxide equivalent of total state emissions for the most recent year. Regulation 6 prescribes the same sectoral summation method as the baseline, again using the Commonwealth inventories. The inventories already include global warming potential factors to convert various greenhouse gases into CO2-e; the regulation adds no independent methodology.

Sector categories for pledges. Regulation 5A prescribes six categories: energy, transport, industrial processes, agriculture, waste, and land use, land use change and forestry. These categories are used for making and evaluating sector pledges under the Act. The inclusion of transport as a separate category is notable because the baseline and annual calculations do not list transport separately - they use only “energy” for fuel combustion. Anyone relying on the regulations for compliance must therefore reconcile the two sets of categories.

Sector pledges. Under sections 43-45 of the Act, a Minister may make sector emissions reduction pledges, and a person may also make a pledge for a sector. Regulation 5A specifies which sectors those pledges can cover. The fact that a Minister can pledge on behalf of a sector, without the consent of participants in that sector, is a feature of the Act rather than the regulations, but the regulations enable that mechanism by identifying which sectors exist.

Register of Carbon Sequestration Agreements. This is a public register of private agreements that grant a carbon sequestration right or soil carbon right over land. It includes the term, parties, land description, variations, transfers, assignments, and end date. The Secretary must make the register and copies of agreements available both physically at the department’s office and online. This transparency function allows third parties (e.g. buyers of land, lenders, carbon credit purchasers) to verify the status of sequestration agreements. The Secretary has discretion to correct, amend or delete recordings “if satisfied that it is necessary to do so to reflect the current status”. There is no statutory obligation on the Secretary to accept corrections at the request of a party; the power is unilateral.

Carbon sequestration right vs soil carbon right. The regulations require the register to record which type of right the agreement grants. These are defined in the Act: a carbon sequestration right is a right to the carbon sequestered by vegetation or other means; a soil carbon right is a right to the carbon sequestered in soil. The distinction matters because different methodologies, permanence obligations and land management practices apply. The regulations do not elaborate on those differences.

Effective dates. The regulations require the register to contain the effective date of the agreement, of any transfer, of any assignment, and of the ending of the agreement. These dates are crucial for determining the temporal scope of the carbon right and for establishing priority between competing interests. The regulations do not prescribe rules for priority; property law and the Act would govern that.

Victorian Government and the Department (administering agency). The Secretary of the Department (now the Department of Energy, Environment and Climate Action) must maintain the Register of Carbon Sequestration Agreements, ensure it is available for inspection and online, and correct or amend entries. The department must also apply the prescribed methods when calculating baseline emissions and annual emissions for the purposes of the Act. This affects departmental resourcing, budget for IT systems, and staff training on Commonwealth inventory methodology.

Landholders and sequestration project proponents. Any landowner or other person who enters into a carbon sequestration agreement (whether for vegetation, soil carbon, or both) will have that agreement recorded on the register. The registration is mandatory - the regulations do not state that the agreement is invalid without registration, but the Act likely conditions the creation or enforceability of the right on registration. Landholders must provide the information required (parties, land description, dates, etc.) and must notify the Secretary of any variations, transfers or assignments to ensure the register remains accurate. This creates an administrative burden, particularly for smaller landholders or those with multiple agreements.

Purchasers of land and financiers. Anyone buying land that is subject to a carbon sequestration agreement can inspect the register to determine the existence, term and parties of the agreement. This reduces information asymmetry and due diligence risk. However, the register is only as reliable as the data entered; the Secretary can correct errors but is not liable for incorrect entries. Lenders taking security over land will also need to check the register to understand whether carbon rights have been granted that may affect the land’s value or the lender’s ability to enforce security.

Emissions-intensive trade-exposed industries and other emitters. The regulations do not directly impose obligations on emitters (no cap, no tax, no reporting). However, the prescribed calculation methods feed into the Act’s target-setting framework. If the Act imposes mandatory emissions reductions, the method for calculating baseline and annual emissions determines how much each sector or entity must reduce. Industries covered by the sector categories (energy, transport, industrial processes, agriculture, waste, LULUCF) will be affected by pledges made under those categories, even if they have not voluntarily agreed to the pledge. The inclusion of transport as a separate category for pledges means the transport sector is explicitly targeted, even though its emissions are likely already counted within the energy sector for baseline purposes.

Participants in carbon markets. The register provides transparency for carbon credit buyers, intermediaries and verifiers. Knowing that an agreement is registered gives some assurance that the right is properly documented, though the regulations do not address whether registration is conclusive evidence of title or priority.

Legal practitioners and conveyancers. They will need to search the register as part of due diligence in property transactions, and advise clients on the implications of registered agreements.

Duty of the Secretary to maintain and make available the Register. Regulation 7 imposes an obligation on the Secretary to ensure the register is maintained and is available for inspection at the department’s principal office and on the department’s website. The Secretary must also cause copies of each agreement (as made and as varied) to be available at the office and online. This is a positive duty to facilitate public access, not simply to keep records. Failure to maintain the register or to make it available could give rise to administrative or perhaps judicial review, but the regulations do not specify a penalty.

Discretionary power of the Secretary to correct, amend, delete or cancel recordings. Regulation 8 gives the Secretary a unilateral power to correct any error, amend any recording, or delete or cancel any recording if satisfied it is necessary to reflect the current status. The regulation does not require the Secretary to seek the consent of the parties before correcting the register. It also does not require the Secretary to give notice or provide reasons for the correction, though general administrative law principles would likely apply. Landholders whose agreements are affected have no statutory right to require the Secretary to correct the register; they may need to seek injunctive or declaratory relief if they believe the Secretary has made an error.

No duty on landholders to register. The regulations do not explicitly require a landholder or party to a sequestration agreement to ensure it is recorded. The Act likely makes registration a precondition for the right’s existence or enforceability, but the regulations themselves impose no obligation to apply for registration. However, if a party wants the benefits of the Act (e.g. recognition of the right, protection on sale of land), they will need to have the agreement registered. The regulations do not set out a process for how a party lodges the agreement for registration; the Act or departmental practice would govern that.

Right of public inspection. Any person may inspect the register at the department’s office and on the department’s website. This is a transparency right. However, the regulations do not say whether the register is searchable by parcel identifier, party name or other criteria; the department may implement its own search interface. The right to inspect copies of agreements is similarly unqualified.

Removal of agreements after they end. The Secretary may remove an agreement from the website after it has ended. This is a power, not a duty. There is no time limit on removal. A party might prefer removal to avoid confusion with current agreements, but cannot compel removal. The physical register at the department’s office presumably retains historical records.

No private right of action. The regulations do not create any cause of action for a person who suffers loss because the register is incorrect, incomplete, or not maintained. A person who relies on an incorrect register entry to their detriment has no statutory remedy under these regulations; they might have common law remedies for negligent misstatement or misleading conduct against the department, but that is not provided for here.

The Climate Change Regulations 2017 do not contain any penalty provisions. They prescribe methods, categories and information requirements, but they do not attach criminal, civil or administrative penalties for non-compliance. Any enforcement mechanisms arise from the parent Act (Climate Change Act 2017) or from other legislation.

If a person fails to ensure that a carbon sequestration agreement is properly recorded, the regulations do not impose a fine or other sanction. The consequence is practical: the agreement may not be enforceable against a third party purchaser of the land, or the carbon right may not be recognised. Similarly, if the Secretary fails to maintain the register or make it available, there is no direct penalty in the regulations. A person aggrieved might seek judicial review or compel performance through a prerogative writ, but that is a general administrative law remedy, not a penalty under this instrument.

The incorporation by reference of the Commonwealth’s State and Territory Greenhouse Gas Inventories means that compliance with the calculation methods depends on the accuracy and timeliness of Commonwealth data. If the Commonwealth updates its inventories but Victoria continues to use a previous version, the calculation may be non-compliant with the regulations as they refer to the inventories “as published from time to time”. There is no enforcement officer or regulator specifically tasked with auditing whether the department uses the correct version.

Because the regulations deal largely with government functions (setting baselines, maintaining a register), enforcement is largely self-contained within government. Private parties have limited enforcement tools. They could potentially bring proceedings for declaratory relief if the Secretary misapplies the calculation method when setting targets, but that would be a challenge to the validity of the target, not a penalty.

Climate Change Act 2017 (Vic). The regulations are made under section 97 of the Act and give effect to several sections: section 11(2) (baseline figure), section 53 (formula variable B), sections 43-45 (sector pledges), and the provisions relating to the Register of Carbon Sequestration Agreements (ss 65-67). The regulations flesh out the detail but do not create new duties beyond those in the Act. Any amendment to the Act would require corresponding changes to the regulations.

Subordinate Legislation Act 1994 (Vic). The regulations are subject to this Act, which governs the making, tabling and sunsetting of Victorian statutory rules. The regulations will sunset on 19 December 2027 (ten years after making) unless remade. They must also be tabled in Parliament and may be disallowed. This provides a periodic review point.

Property Law Act 1958 (Vic) and common law. The Register of Carbon Sequestration Agreements interacts with land law. Carbon sequestration rights and soil carbon rights are statutory rights under the Climate Change Act; they can be registered on the register. However, the regulations do not address how the register interacts with the Torrens title system under the Transfer of Land Act 1958. A carbon right registered under these regulations may not be caveatable or noted on the certificate of title unless additional steps are taken. This could create priority issues if a landowner grants a mortgage or sells the land after entering a sequestration agreement but before the agreement is known to the purchaser.

Commonwealth legislation. The regulations dynamically incorporate the Commonwealth’s “State and Territory Greenhouse Gas Inventories”. These inventories are produced under the National Greenhouse and Energy Reporting Act 2007 (Cth) and related instruments. The Victorian method is therefore tied to Commonwealth methodology for estimating emissions from various sectors. Changes to Commonwealth definitions, factors or scope will automatically affect Victorian emissions calculations without any Victorian parliamentary scrutiny. Additionally, the Carbon Credits (Carbon Farming Initiative) Act 2011 (Cth) governs Australian carbon credit units and sequestration projects. Victorian sequestration agreements may interact with or duplicate Commonwealth project registration, and the Victorian register does not replace the Commonwealth’s Emissions Reduction Fund register.

Environmental Planning and Assessment Act 2017? Not directly, but land use decisions affecting emissions (e.g., land clearing, development) may be relevant to sector ambitions under the pledges. The regulations do not create any additional planning controls.

Freedom of Information Act 1982 (Vic). Because the register and copies of agreements must be publicly available (both online and at the department’s office), FOI may not be necessary to access them. However, the FOI Act would apply to any records not already published, such as internal decisions about corrections.

Privacy and Data Protection Act 2014 (Vic). The register includes the names of parties to agreements. That is personal information if the party is a natural person. The department must comply with privacy principles in collecting, using and disclosing that information, and in making it publicly available. The regulation itself authorises the publication, so it would likely satisfy the information-privacy principle that allows disclosure if authorised by law.

The Climate Change Regulations 2017 were made on 19 December 2017 and came into operation on 20 December 2017. The only amendment to date is the Climate Change Amendment Regulations 2020 (S.R. No. 144/2020), made and commenced on 22 December 2020.

The 2020 amendment made several changes:

• Amended regulation 1 (Objectives) to add paragraph (d): prescribing categories of greenhouse gas emissions and removals for sector pledges.
• Replaced the heading of Part 2 (previously “Greenhouse gas emissions calculations”) to include “and sector pledges”.
• Substituted a new regulation 5, changing the method for determining the 2005 baseline to explicitly reference “State and Territory Greenhouse Gas Inventories” and adding “land use, land use change and forestry” as a sector. The original regulation 5 had referenced only “energy, industrial processes, agriculture, waste, forestry, land use change and any other sectors” without a specific definition of the source document.
• Inserted new regulation 5A: categories for sector pledges (energy, transport, industrial processes, agriculture, waste, land use, land use change and forestry).
• Substituted new regulation 6, updating the method for determining CO2 equivalent in the formula in section 53 to match the new sector list and reference the State and Territory Greenhouse Gas Inventories.
• Inserted a definition of “industrial processes” into regulation 4, cross-referencing the Commonwealth inventories.
• Inserted a definition of “State and Territory Greenhouse Gas Inventories” into regulation 4, specifying the document title and publication source.

The original 2017 regulations did not include transport as a separate category for pledges, and did not have an express definition of the Commonwealth document. The 2020 amendment aligned the regulations with the Commonwealth’s updated inventory structure and introduced the sector pledge framework, which appears to have been added by the Climate Change Act amendment in 2019? Actually, the Act itself was amended to allow sector pledges, and the regulations now prescribe the categories.

The regulations incorporate two versions of the Commonwealth inventories: for the baseline and annual calculations, the 2017 regulation originally referred to the 2015 inventories; the 2020 amendment now refers to the 2018 inventories for definitions, but the calculation regulations refer to the inventories “as published from time to time”, so the version is not static.

The sunset provision remains: the regulations cease on 19 December 2027 unless re-made.

The source text provided does not contain any references to litigation concerning the Climate Change Regulations 2017. As a relatively narrow and technical statutory rule, it is unlikely to have been the subject of any reported cases. Most challenges in the climate change space in Victoria have focused on the Act itself or on specific decisions made under it (e.g., decisions on targets, environmental impact assessments), rather than on the subordinate regulations.

If there were any litigation, it would likely involve challenges to the validity of the regulations on the ground that they improperly delegate legislative power by incorporating future Commonwealth documents, or that they fail to meet the procedural requirements of the Subordinate Legislation Act 1994. There has been no such successful challenge recorded.

Alternatively, landowners or project proponents might have brought proceedings to compel the Secretary to correct the Register or to challenge a decision to remove an entry, but no such case is noted.

The absence of litigation history does not mean the regulations are immune from challenge; it may simply indicate that the issues have not arisen or that parties have resolved them administratively.

Dynamic incorporation of federal documents without Victorian scrutiny. Regulations 5, 5A, 6 and the definitions incorporate “State and Territory Greenhouse Gas Inventories” as published from time to time. This means that any change to Commonwealth methodology, emission factors, or sector definitions automatically changes the Victorian baseline and annual calculations. There is no requirement for the Victorian Minister or Parliament to approve those changes. A future Commonwealth government could revise the inventories in a way that makes the Victorian baseline appear higher or lower, directly affecting the stringency of targets. This is a significant delegation of control over a key numeric parameter.

Transport sector appears only in pledges, not in baseline or annual calculations. Regulation 5A lists transport as a separate category for sector pledges. However, regulations 5 and 6 (baseline and annual calculations) do not list transport separately; they include only “energy” (which in Commonwealth inventories includes transport fuel combustion). This creates an asymmetry: a sector pledge for transport would cover emissions that are already embedded in the energy sector in the baseline. If a pledge aims to reduce transport emissions separately, it may double-count or be difficult to measure against the baseline.

Register amendments are at the Secretary’s discretion. Regulation 8 permits the Secretary to correct, amend, delete or cancel recordings if “necessary to reflect the current status”. This is a broad power with no statutory criteria for when it is “necessary”. A party who wants the register updated may have no right to demand it. Conversely, the Secretary could unilaterally delete a recording without the party’s consent, subject only to general administrative law constraints. There is no appeal mechanism provided in the regulations.

No guarantee of accuracy of the register. The Secretary must maintain the register, but there is no provision for verifying the information before entry. An incorrect description of land or a wrong party name could mislead purchasers or financiers. The regulations do not impose liability on the Secretary for errors in the register. A person who relies on a mistake may have no recourse.

Removal of agreements from the website after expiry. Regulation 9 allows the Secretary to remove an agreement from the website after it ends. The register at the department’s office presumably retains the history. However, the regulation does not require that the removal be recorded as such; the agreement simply vanishes from the website. A person searching the website may not realise that a now-expired agreement ever existed. This could be a problem if disputes arise after the agreement has ended.

No transitional provisions. The 2020 amendment did not include transitional rules for existing sequestration agreements or for calculations using the old method. The old baseline method under the original regulation 5 may have produced a different figure for 2005 than the method in the substituted regulation 5. The amendment applies from 22 December 2020, but there is no provision for recalculating historical baselines. This creates potential inconsistency if the Act requires a single baseline figure.

No subscription mechanism for Commonwealth updates. Because the regulations incorporate Commonwealth documents as published from time to time, anyone needing to know the current baseline figure must monitor federal publications. There is no requirement for the Victorian department to publish the current effective version of the inventories or to notify stakeholders of changes.

Interaction with Torrens title not addressed. The Register of Carbon Sequestration Agreements is separate from the land titles register. A carbon right registered here may not appear on the title deed to the land. This increases transaction costs for purchasers who must search two registers to be fully informed. It also creates risk of fraud if a landowner registers a carbon agreement and later sells the land without disclosing it, and the buyer fails to search the separate register.

For the Department (Secretary). The Secretary must physically establish and maintain the Register of Carbon Sequestration Agreements, ensuring it contains all fields listed in regulation 7(1) for each registered agreement. The register must be available for inspection at the principal office of the department, and a copy of the register must be published on the department’s website. Additionally, copies of each agreement (both as originally made and as varied) must be available for inspection at the office and on the website. The Secretary should implement a searchable online database that allows users to locate agreements by party name or land description. The Secretary should also maintain a process for receiving and processing requests to correct, amend, delete or cancel recordings, and for making discretionary decisions under regulation 8 in a manner consistent with administrative law (giving reasons, natural justice). When an agreement ends, the Secretary may remove it from the website but should retain a paper or electronic record at the office.

For persons entering a carbon sequestration agreement. While the regulations do not impose a duty to register, the Act likely makes the agreement effective only if registered. Therefore, a party to a sequestration agreement should ensure that the Secretary is notified of the agreement and that the required information is provided. The parties should cooperate to verify the land description, the type of right (carbon sequestration or soil carbon), the effective date, and the term. They should also promptly notify the Secretary of any variation, transfer or assignment, so that the register remains current. Failure to do so may render the agreement unenforceable against third parties. Because the Secretary has unilateral correction power, parties should ensure the information they submit is accurate at the time of lodgement and that they keep evidence of lodgement.

For entities whose emissions are counted under the Act. The regulations do not require an entity to calculate its own emissions using the prescribed method; that is the department’s function. However, entities subject to sector pledges under sections 43-45 should be aware of which sector they fall into (energy, transport, industrial processes, agriculture, waste, LULUCF). If the Minister makes a pledge for that sector, the entity may be expected to contribute to reductions, even if the pledge is non-binding. The entity should monitor the Commonwealth State and Territory Greenhouse Gas Inventories for changes that may affect the sector’s measured emissions, because changes to the inventories will flow into the Victorian calculation of whether the sector pledge is being met.

For land purchasers and financiers. Before acquiring or lending against land, search the Register of Carbon Sequestration Agreements on the department’s website to see if there is any registered carbon sequestration or soil carbon agreement affecting the land. Check the names of parties, the land description, and the term. If an agreement exists, consider how it might affect land use (e.g., restrictions on clearing, soil disturbance, land management obligations). A lender should ensure that the landowner’s obligations under the sequestration agreement do not conflict with the lender’s security. Also, note that the register may not be conclusive - confirm with the landowner in the contract of sale or loan documentation. Because the Secretary may have corrected or removed entries without notice, check the register as close to settlement as possible.

For legal practitioners. Incorporate a search of the Register of Carbon Sequestration Agreements into standard due diligence for property transactions. Advise clients that this register is separate from the Torrens title register. In drafting sequestration agreements, ensure that all information required by regulation 7(1) is clearly included (parties, right type, land description, dates, term, provisions for variation, transfer, assignment and termination). Consider adding a clause requiring the parties to cooperate in registering the agreement and notifying the Secretary of changes. Warn clients that the Secretary has discretion to correct or delete entries without their consent, though they may be able to challenge that in court if needed.