The Clean Energy Regulator (the Regulator) is an independent regulator responsible for administering a number of climate change laws. These include:
The purpose of these laws is to:
The Regulator administers a number of schemes under the climate change laws, including the:
This policy sits within the broader Australian Government law enforcement policy context. It should therefore be read in conjunction with other relevant instruments and documents, including the
Prosecution Policy of the Commonwealth,
Commonwealth Fraud Control Framework and the
Overarching Principles for Selecting Cases for Investigation and Administrative, Civil and Criminal Sanctions.
This policy outlines the approach adopted by the Regulator to optimise compliance with the climate change laws it administers. This includes explaining the role of education to encourage compliance, and the overall approach to compliance monitoring and enforcement.
Responsibility for complying with relevant requirements under legislation administered by the Regulator (including ensuring the accuracy of all information provided to the Regulator) rests with the individual person or organisation to who the legislation applies.
The Regulator monitors participant's ability and willingness to meet their obligations under the legislation, using a risk-based approach to detecting non-compliance and actively encouraging the return to compliance. This is achieved by:
The Regulator recognises that engagement, education and support in the first instance are vital to best ensuring participants meet their obligations, and to avoid inadvertent non-compliance. To assist participants, the Regulator publishes resources and guidance information such as guidelines, factsheets, booklets, brochures, newsletters, calculators and online resources.
The Regulator also ensures participants have the opportunity to raise issues of concern, and to participate in workshops and discussion forums.
In taking a risk based approach to compliance, the effort in monitoring is focussed around:
Compliance monitoring methods include:
Suspected contraventions of any laws administered by the Regulator are assessed to determine the most appropriate response.
As a first step, a preliminary examination and analysis of relevant facts is conducted to decide the likelihood that a contravention has occurred or may occur, the degree of seriousness, and any likely consequences. To assist in determining the appropriate response, the Regulator uses a risk-based approach that considers participant behaviour and motivation. The continuum at
Figure 1 (below) shows how behaviours and motivations are matched against potential responses, according to the level of risk posed by the behaviours.
A range of responses to contraventions exist. These include:
A full list of responses to contraventions is at
While all suspected contraventions are carefully considered, the Regulator exercises discretion when determining the type of response it will employ to address contraventions or otherwise resolve matters, including decisions as to whether to investigate further.
As a general principle, the Regulator is less likely to pursue legal actions where a person or entity has demonstrated good faith and/or is willing to resolve matters administratively.
Behaviour that is likely to result in enforcement action is:
The Regulator has no authority to prosecute breaches of laws administered by other regulators. However, breaches of the law may be relevant to schemes that the Regulator does administer. For example, where a person is required to meet a fit and proper person requirement to participate in a climate change law scheme, the person's history of compliance or non-compliance with the law is taken into account. Similarly, where the Regulator receives information alleging a contravention of the law which could affect eligibility for a benefit under a scheme administered by the Regulator, the Regulator will investigate (including the use of its coercive information gathering powers if appropriate) and consider further action or referral. Where the Regulator obtains information that indicates a possible breach of a law outside the scope of the Regulator's administration or is better handled by another agency (for example, allegations of fraudulent behaviour or potential scams), it refers that information to the appropriate body for their attention.
In some cases the Regulator is legally obliged to publish information. An example is the acceptance of enforceable undertakings under the REE Act. The Regulator will publish such information as soon as practicable after the information becomes available.
The Regulator will also publish the commencement and outcomes of any court action, the issuance of infringement notices and other types of enforcement action. Generally, this information will be published as soon as practicable. However, in some circumstances, such as an ongoing investigation, the Regulator will use its discretion on the timing of any publication.
The Regulator is committed to administering the climate change laws in a transparent, ethical and accountable manner. As part of this, the Regulator regularly reviews this policy and its implementation, to ensure the policy is relevant and that all relevant operational experience and legislative amendments are incorporated. Where amendments to this policy are required, the updated policy can be found on the
Further information about the Regulator, the relevant legislation, and all relevant administrative, civil and criminal penalties can be found at
www.cleanenergyregulator.gov.au or by telephone 1300 553 542.
This attachment outlines the regulator's enforcement options under the:
Audits by independent auditors: The Regulator may appoint an auditor to audit a person's compliance with one or more aspects of the legislation; or, require a person to appoint an auditor if the Regulator believes that the person has contravened, is contravening or is proposing to contravene the legislation.
Inspections: The Regulator will use inspectors/authorised officers to enter premises by consent or under warrant in order to determine whether the legislation and associated provisions have been complied with, or to substantiate information provided under the legislation and associated provisions.
Information-gathering: The Regulator may require a person to provide information or documents, where it believes on reasonable grounds that the information or documents are relevant to the operation of the legislation.
Default assessments: Under the REE Act, the Regulator may make an assessment of a liable entity's large-scale generation shortfall and associated charge (if any) for the year or, of an entity's small-scale technology shortfall and associated shortfall charge for the year.
Under the CFI Act, a person commits an offence where that person has entered into a scheme to avoid an existing, or future liability, to pay an administrative penalty or a unit shortfall charge.
Under the REE Act, where the Regulator is of the opinion that an arrangement was entered into for the sole or main purpose of avoiding payment of a renewable energy shortfall charge otherwise than in accordance with that Act, the entity is liable to pay an amount of shortfall charge equal to the amount that it would have been liable to pay if the arrangement had not been made.
Enforceable undertakings: The Regulator may accept a written undertaking from a person that they will do, or refrain from doing, certain things in order to comply with the relevant Act. Breach of such an undertaking may result in court action.
Penalty infringement notices: Where the Regulator has reasonable grounds to believe that a person has breached a civil penalty provision, the Regulator may issue that person with a penalty infringement notice. The penalty infringement notice will specify the contravention and the amount of the penalty. Failure to pay the stated amount may result in court action in relation to the alleged contravention.
Suspension: The Regulator may suspend a person's registration where that person has been convicted of an offence under the REE Act or where the Regulator has reasonable belief that the person has committed any such offence, or contravened a civil penalty provision. Other reasons for suspension include where the Regulator is satisfied that the person is not a fit and proper person, or where the registration was obtained improperly.
Revocations: The Regulator may unilaterally revoke the declaration of an eligible offsets project under the CFI Act in various circumstances, for example, where the Regulator is satisfied that the project is no longer eligible or the project proponent is no longer a fit and proper person. The Regulator must consult with the project proponent before such a decision is made.
Relinquishment of units: The Regulator may issue to a person a notice requiring the person to relinquish units under various circumstances, for example, where units are issued to a person as a result of the person knowingly providing false or misleading information. Failure to relinquish units may result in the person being liable to pay an administrative penalty to the Commonwealth. A court may also order relinquishment if units were issued as a result of fraudulent conduct.
Unilateral closure of registry accounts: The Regulator may unilaterally close a person's registry account where that person has contravened, or is contravening, the provisions relating to the Australian National Registry of Emissions Units. If the Regulator has closed a person's account, it will not open another account in that person's name. The Regulator may also apply the following enforcement options to accounts within the Australian National Registry of Emissions Units:
The following table sets out the responses available to the Regulator under the relevant climate change law:
Court action: The Regulator will pursue legal action, where appropriate, for continuing or serious contraventions. Legal action may result in a court:
The Clean Energy Regulator's Compliance, Education and Enforcement Policy is made available on the understanding that the Commonwealth is not providing professional advice. Before relying on any material, readers should obtain appropriate professional advice. The information contained in this policy is current at the time of release but is subject to change. While reasonable care has been taken in preparing this information, the Commonwealth provides no warranties and makes no representations that the information is correct, complete or reliable. The Commonwealth expressly disclaims liability for any loss, however caused and whether due to negligence or otherwise, arising directly or indirectly from the use or reliance on information contained in the policy.
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