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The Greenhouse Gas Abatement Scheme
GGAS is one of the first mandatory greenhouse gas emissions trading schemes in the world and aims to reduce greenhouse gas emissions associated with the production and use of electricity.
It achieves this by developing and encouraging project-based activities to offset the production of greenhouse gas emissions.
GGAS establishes annual state-wide greenhouse gas reduction targets, and then requires individual electricity retailers and certain other parties who buy or sell electricity in NSW to meet mandatory benchmarks based on the size of their share of the electricity market. These parties, known as benchmark participants, are required to reduce their emissions of greenhouse gases to the level of their greenhouse gas benchmark by offsetting their excess emissions through the surrender of abatement certificates. If these benchmark participants fail to meet their benchmarks, then a penalty is assigned. Monitoring the performance of benchmark participants is undertaken by the Independent Pricing and Regulatory Tribunal of NSW (IPART) in its role as Compliance Regulator.
Boral is a voluntary or ‘elective’ benchmark participant’ in GGAS, and as a large industrial energy user has chosen to participate in GGAS to offset increased power bills by claiming credit for reducing on-site emissions of greenhouse gases from non-electricity related industrial processes at sites that we own and control.
Boral first to create Large User Abatement Certificates (LUACs)
As one of nine ‘elective’ benchmark participants electing to manage their own greenhouse gas benchmarks (also includes companies such as Amcor, Bluescope Steel (AIS) Pty Ltd, Visy Industries and OneSteel) and a ‘Large User’ of over 100 GWh of electricity in a year, Boral is entitled to create large user abatement certificates or LUACs.
LUACs are non-tradable abatement certificates created by large users’ eligible abatement activities that reduce on-site greenhouse gas emissions not directly related to the use of electricity. They can only be surrendered by a large user in their capacity as a benchmark participant to meet their own greenhouse gas benchmark.
Each LUAC is equal to the reduction of one tonne of carbon dioxide equivalent (tCO2-e) that would otherwise have been released into the atmosphere by the large user as a result of their abatement activities. Boral expects to generate up to 195,000 LUACs a year, offsetting liabilities under the scheme, expected to rise to more than $1m annually in the next few years.
Boral is the first company to create large user abatement certificates (LUACs) under the GGAS scheme, meeting its share of reducing the NSW electricity sector greenhouse gas benchmark by carrying out activities that abate greenhouse gases at its Boral Berrima site. GGAS scheme administrator James Cox, said Boral’s creation of the certificates was a "very significant" step. "The Boral project at its Berrima cement works is the fourth accreditation by the scheme administrator … but Boral is the first accredited party to create certificates. This represents a significant milestone," he said.
Grant Williams, Technical Services Manager, Boral Cement and manager of the GGAS scheme for Boral comments: "The upgrade of Kiln 6 has allowed Berrima to significantly reduce its emissions of greenhouse gases and electricity use through more efficient operations, improving the sustainability of the Berrima Works and Boral. We are currently working with IPART to have the project registered to generate NGACs through the lower electricity use and have been pleased with the support by IPART and the scheme administrators in preparing the application. The upgrade of Kiln 6 has been a good outcome for the environment."
Sources:
- http://www.greenhousegas.nsw.gov.au
- ‘Boral first to create LUACs under NSW greenhouse scheme’, Environmental Manager,
Issue 570, March 21, 2006. |
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