Safeguard facilities are required to keep their net emissions at or below their prescribed emissions baseline.
If a facility's emissions exceed or are expected to exceed its baseline, the facility operator has a number of options available to them to manage the excess emissions, including:
There is a range of enforcement options available to the Clean Energy Regulator where a responsible emitter fails to take one of the above actions. These options include entering into an enforceable undertaking, issuing an infringement notice, or court proceedings to seek an injunction or civil penalties.
There are several circumstances in which a facility's baseline may be temporarily or permanently increased.
Calculated baselines are intended for facilities that do not have sufficient historical emissions data to make a reported baseline, or for which historical emissions may be a poor indicator of future emissions.
Emissions intensity baseline variations are intended to cover circumstances where expanding production is accompanied by an emissions intensity improvement (that is, the emissions intensity of production has decreased).
Safeguard facilities can surrender Australian carbon credit units (ACCUs) to offset their emissions and stay below their baseline.
The responsible emitter can either purchase ACCUs from other businesses, or generate their own ACCUs for abatement under the
Emissions Reduction Fund (ERF).
The facility can then surrender its ACCUs to the Clean Energy Regulator or sell them to the government through an ERF contract. The ACCUs will be subtracted from the facility's emissions number, helping to keep emissions levels below the baseline.
To avoid counting offsets twice, a facility that is both covered by safeguard and a participant in ERF will have ACCUs it has generated added to its net emissions number. When the facility surrenders ACCUs, they will be subtracted from its emissions number. This way, each tonne of abatement represented by an ACCU is only counted once. See the Department of the Environment and Energy's
double counting fact sheet for more information about this process.
To accommodate natural variability, safeguard facilities may apply for a multi-year monitoring period using our
Documentasset: Multi-year monitoring application form.
Multi-year monitoring allows a facility to exceed its baseline in one year, so long as average emissions over a two- or three-year period are below the baseline.
The monitoring period can cover two to three years, giving businesses sufficient time to implement emissions reduction projects, acquire offsets or help capture natural peaks and troughs in emissions.
Facilities whose excess emissions are the direct result of exceptional circumstances, such as a natural disaster or criminal activity, may be exempted from safeguard obligations for a defined period of time.
We will consider whether reasonable steps were taken to mitigate the risk of excess emissions arising from the exceptional circumstances, both before and after its occurrence.
Exemptions will not apply to events that reflect normal market dynamics or as a mechanism for addressing drivers of emissions variation, such as changes to price, production inputs and outputs, or maintenance.
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