ACCU Scheme: Carbon Credits (Carbon Farming Initiative) Act 2011 and Climate Active

ACCU Scheme legal framework

The Carbon Credits (Carbon Farming Initiative) Act 2011 establishes the legal framework for the Australian Carbon Credit Units (ACCUs) scheme. This Act provides the foundation for the creation and issuance of ACCUs, where one ACCU represents one tonne of carbon dioxide equivalent (tCO2-e) of avoided emissions or sequestered carbon. The scheme operates in conjunction with the NGER greenhouse and energy reporting Act 2007.

The Clean Energy Regulator (CER) is responsible for administering the ACCU Scheme and issuing ACCUs to project proponents. To be eligible to earn ACCUs, projects must utilise a method determined by the Minister under section 106 of the CFI Act.

Detailed operating rules for the ACCU Scheme are outlined in the Carbon Credits (Carbon Farming Initiative) Rule 2015. This Rule provides further guidance on how the scheme functions and the requirements for project proponents.

Approved ACCU methods

Approved ACCU methods address a range of activities designed to reduce carbon emissions or increase carbon storage. These methods cover vegetation projects, including reforestation, avoided clearing, and plantation forestry. Other categories include savanna fire management, soil carbon sequestration, agricultural emissions reduction, waste management, and energy and industrial activities. Carbon Border Adjustment Mechanism (CBAM) Australia

The development and application of these methods are subject to rigorous standards. Following the 2022 Chubb Review, reforms were implemented to improve method development and integrity. The Emissions Reduction Assurance Committee provides independent advice on method integrity under section 255 of the *Carbon Farming Initiative* Act 2011.

All projects generating ACCUs must satisfy the Offsets Integrity Standards outlined in section 133 of the *Carbon Farming Initiative* Act 2011. These standards ensure that projects are additional and permanent. Sequestration projects, in particular, must commit to maintaining carbon stores for either a 25 or 100-year permanence period.

Issuance, registry and trading

ACCUs are issued following a Carbon Offset Registry (CER) assessment of an offsets report. These credits are then issued to a registered Australian National Registry of Emissions Units (ANREU) account. ACCUs have the legal character of personal property and are assigned a unique identifier on the ANREU register. Holders of ACCUs pay the CER a per-ACCU issuance fee and an annual account fee, which are managed under cost-recovery arrangements. ASRS vs ISSB vs CSRD climate disclosure

ACCUs can be sold to the Government under Carbon Abatement Contracts or transferred privately to other ANREU account holders. This allows for flexibility in how carbon abatement is managed and utilised. Safeguard Mechanism facilities can also surrender ACCUs to fulfil their excess-emissions obligations, with each ACCU offsetting one tonne of emissions above baseline levels.

The ANREU register tracks ownership and transfers of ACCUs, providing transparency and accountability within the system. This registry is a crucial component of the ACCU Scheme, ensuring the integrity of carbon credits and facilitating their use in meeting emissions reduction targets. ASRS vs ISSB vs CSRD climate disclosure

Climate Active certification

Climate Active is the Australian Government’s voluntary carbon-neutral certification programme, administered by the Department of Climate Change, Energy and Environment (DCCEEW). Organisations, products, services, events, buildings and precincts seeking certification must measure their emissions and offset the residual emissions to achieve net zero.

Certified entities use offsets to achieve net zero. These offsets must be eligible units listed in the Climate Active Carbon Neutral Standard, which includes Australian Carbon Credit Units (ACCUs) and selected international units. The Standard mandates public disclosure of the emissions inventory, reduction strategy, and offset retirement. ASRS Group 1 disclosure walkthrough provides further information.

DCCEEW undertook consultations during 2023-2024 to reform the programme. These reforms aim to strengthen integrity and align Climate Active with the Net Zero Plan.