Recent accusations against Australia’s carbon market regulatory framework have been sensationalised and risk undermining a world leading framework for carbon credit generation said the Carbon Market Institute (CMI).

“It’s vital we continue to support Australia’s carbon crediting framework, which has had long-running bi-partisan support, at a time when climate action needs to be accelerated,” said John Connor CMI CEO.

CMI has commissioned a report to explain the different elements of integrity that are enshrined within Australia’s carbon scheme, but in the meantime notes that:

  • All methodologies are required to have regard to legislated offset integrity standards, which include that only abatement activity that would not ordinarily have happened is credited and that any abatement credited is conservative
  • Method development is subject to extensive consultation with technical experts and broader stakeholders
  • There is an independent process of review for new methodologies and the ability for existing methodologies to be reviewed at any time if there are concerns about whether they still comply with the legislated offset integrity standards
  • Projects cannot be registered unless they comply with the requirements of a methodology
  • Claims for issuances of Australian Carbon Credit Units (ACCUs) are regularly audited by independent, third-party auditors
  • ACCUs are regulated as financial products under corporation law and there are licensing requirements for those who deal in ACCUs or provide financial advice about them

“Sensational claims of “fraud, “rorts and “sham” have led to many feeling aggrieved within the vast network of farmers, traditional owners, service providers, investors, auditors, conservationists and public servants involved with the scheme, many of whom have spent the last decade striving to accelerate support for stronger industrial emission reduction, sustainable agriculture and reversal of deforestation. There are concerns these accusations do not appear to be substantiated by the academic papers.”

CMI and its members are analysing the technical papers released late last week, which we understand are pending peer review, and will put out a comprehensive response later this week.

“However, the land management papers for example, don’t back up claims that 70 – 80 % of Australian Carbon Credit Units are “devoid of integrity”.  The papers focused on the Human Induced Regeneration (HIR) methodology appear to confuse principles under the methodology which is aimed at crediting transition to forest cover, not current forest levels. The transition to forest cover is closely regulated, including 5-yearly regeneration checks, and a 15 year forest cover attainment check.  The papers also understate additional requirements made in 2019 to the HIR methodology which were designed to improve integrity of these projects.”

“CMI and its members are committed to continuous improvement of Australia’s carbon market, and welcome proposals for ongoing improvement in methods, additionality, transparency and governance. CMI, through its Landscape Taskforce, has been raising the importance of improved national data sharing frameworks that would improve transparency for some time. Governance systems of separation of power and firewalls should be and are regularly reviewed and should avoid perceptions and reality of conflict of interests.”

“These are important issues to get right, but we cannot lose sight of the critical role for carbon markets and crediting of abatement activity as an important tool for an efficient and cost-effective transition to net zero emission economies.  “

“CMI stands ready to participate in any independent review or other processes necessary to enable the investments and reforms which are required to address our twin climate and biodiversity crises,” concluded Connor

The Carbon Market Institute is the independent industry association for business leading the transition to net zero emissions. Its over 130 members include primary producers, carbon service providers, Indigenous corporations, legal, technology and advisory services, insurers, banks, investors, corporate entities and emission intensive industries developing decarbonisation and offset strategies.

For further information, contact Thomas Hann on 0408880536 or

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