One of the toughest challenges in designing the Abbott
government's Emissions Reduction Fund is to determine where to
draw the line – what companies and what activities should be
rewarded with taxpayer funded contracts. And it becomes
particularly problematic when government administrative decisions
on valuable property rights and government contracts can be subject
to legal challenge.
Under Direct Action, companies are able to be rewarded for
genuine and additional emissions reductions. But this raises the
questions of how to determine whether reductions have actually
occurred and then whether they are actually additional.
The Green Paper proposes that the rules for companies to
calculate and verify emissions reductions from different activities
will be set out in emissions reduction methods. These methods will
either be activity-based or facility based. These methodologies
will be in a similar form to those currently required under the
Carbon Farming Initiative
