The Federal Government will establish a new agency to administer its recently announced price on carbon. The data-heavy responsibilities of the body mean it will have significant ICT needs and only a short window of time in which to see them met.
Under the Government’s Clean Energy Future scheme, liability for the carbon price mechanism will be assessed by the Clean Energy Regulator (CER), which will also be in charge of monitoring and enforcing compliance with the tax mechanism.
The tax on the country’s top 500 carbon emitters is due to come in effect on 1 July 2012. The carbon price mechanism will transform into an emissions trading scheme in 2015.
CER will be an independent body accountable to the Minister for Climate Change and Energy Efficiency.
CER is forecast to cost $256 million over four years to 2014-15:
- $68 million in 2011-12;
- $68 million in 2012-13;
- $61 million in 2013-14; and
- $59 million in 2014-14.
These figures (Appendix C – Fiscal Tables) were not included in the Government’s 2011-12 Budget, as the legislation was not yet passed. It is expected that they will be reflected in the mid-year economic and fiscal outlook (MYEFO) statement by the Treasurer and Minister for Finance and Deregulation.
It is likely that CER will require ICT systems and support. Some, such as hardware and desktop/ office automation systems may be provided by its parent agency under a shared services arrangement but other business needs are likely require ICT supported-solutions. In particular, there are likely to be requirements in the areas of:
- Website development;
- Emissions data assessment and determination of liability; and
- Monitoring and enforcement functions.
According to the Clean Energy Future plan, the CER will administer the carbon price mechanism and “fulfil all usual regulatory functions and manage regulatory risk. It will be responsible for:
- providing education on the carbon pricing mechanism, particularly about the administrative arrangements of the carbon pricing mechanism;
- assessing emissions data to determine each entity’s liability;
- operating the Australian National Registry of Emissions Units;
- monitoring, facilitating and enforcing compliance with the carbon pricing mechanism;
- allocating permits including freely allocated permits, fixed price permits and auctioned permits;
- applying legislative rules to determine if a particular entity is eligible for assistance in the form of permits to be allocated administratively, and the number of other permits to be allocated;
- administering the National Greenhouse and Energy Reporting system, the Renewable Energy Target and the Carbon Farming Initiative, the regulatory functions which will be brought together with the Clean Energy Regulator to form an independent regulator from July 2012; and
- accrediting auditors for the Carbon Farming Initiative and the National Greenhouse and Energy Reporting System.”
Of these intended CER activities, the National Registry of Emissions Units has already been established to monitor progress against Australia’s commitments to the Kyoto Protocol and the National Greenhouse and Energy Reporting System is also already in place.
The National Greenhouse and Energy Reporting System is supported by the Online System for Comprehensive Activity Reporting (OSCAR). Currently all Australian companies emitting beyond a set carbon threshold are obliged to register and report on OSCAR.
The total revenue due to be collected and managed by CER is forecast to exceed $24 billion over the forward estimates period to 2014-15.
While it will be the most ‘ICT intensive’ agency to be established in support of the Clean Energy Future scheme, CER will be joined by several other new additions to the Federal Government.
The Australian Renewable Energy Agency (ARENA) is an independent statutory authority to be formed to undertake the management and distribution of $3.2 billion in grants for renewable energy projects.
It will be formed within the Resources, Energy and Tourism portfolio, taking in existing bodies such as the Australian Centre for Renewable Energy (ACRE), the Australian Solar Institute and the Australian Biofuels Research Institute.
While unable to provide a figure on forecast staffing numbers, a spokesperson for the Department of Climate Change and Energy Efficiency told Intermediumthat staff and funding will be sourced from within the Department of Resources, Energy and Tourism (DRET).
In 2013-14 the government will also establish the Clean Energy Finance Corporation (CEFC), for which it has put aside operating budget allocations of $944 million over four years, with the bulk of this funding to be spent in 2013-14 and 2014-15.
The CEFC will primarily consist of a Board with expertise across investment management and clean energy, and will distribute $10 billion in loans, loan guarantees and equity investments to drive innovation in renewable technology in Australia.
“The Prime Minister will appoint a Chair of the Clean Energy Finance Corporation to consider the most efficient and effective way to establish the Corporation. The Chair will make recommendations to the Government on the responsibilities of the Board and CEO and the role of Australian Public Service staff,” said spokesperson for the Department of Climate Change and Energy Efficiency.
“The Government will finalise the CEFC’s staffing arrangements after receiving the Chair’s report in early 2012. A small secretariat will be established to assist with the Chair’s review,” she said.