Safeguard and Rehab Activities – Did You Know About Section 101?
What is Safeguard?
The Safeguard Mechanism was introduced in 2016 under section 22XS of the National Greenhouse and Energy Reporting (NGER) Act and provides a framework for Australia’s largest emitters to measure, report and manage their greenhouse gas (GHG) emissions. The aim of the Safeguard Mechanism is to provide an incentive for facilities to reduce emissions and make meaningful steps to achieve climate targets.
Administered by the Clean Energy Regulator (CER), facilities that emit 100,000 t CO2-e or more Scope 1 GHG emissions annually are required to meet Safeguard requirements. If a facility exceeds its Safeguard baseline, the facility is required to manage its excess emissions by:
Purchasing and surrendering eligible Australian Carbon Credit Units (ACCUs) or Safeguard Mechanism Credits (SMCs) to mitigate against excess emissions such that net emissions remain below the facility’s baseline, or
Applying for a multi-year monitoring period (MYMP) (for up to 5 years) to allow more time to reduce emissions so the average emissions over the multi-year monitoring period is below the baseline, or
Applying to borrow baseline from the following compliance year, or
Applying to become a trade-exposed baseline-adjusted (TEBA) facility and receiving a discounted decline rate (for up to 3 years), or
Seeking an exceptional circumstances exemption, if applicable
What is a Safeguard Production Variable?
If a facility exceeds the Safeguard facility threshold, it may be eligible for a standard baseline (i.e. a baseline that adjusts annually based on production quantities multiplied by a determined emissions intensity value). To obtain a standard baseline, facilities are required to identify their Safeguard Production Variable (PV) and apply for a facility-specific emissions intensity that will be used to calculate the baseline total.
As defined by the CER, a Safeguard PV is a metric that generally represents the productive output of the facility. The prescribed Safeguard PVs include guidance on what activities are covered by the PV and the metrics that apply. Once a facility has determined its applicable Safeguard PVs, their standard baseline is calculated by measuring the production quantity in the reporting period and multiplying it by the determined emissions intensity value. The prescribed Safeguard PVs are listed in Schedule 1 of the Safeguard Rule.
Section 101: What is the Mine Rehabilitation Production Variable?
The definition of the Mine Rehabilitation Production Variable (PV), as described under section 101 of the Safeguard Mechanism Rule, is primarily intended to capture the rehabilitation at the end of a mine’s life when the mine ceases production. Progressive and continuous rehabilitation during the continued operation of the mine is considered to be part of the mining-related PVs.
However, when rehabilitation activities are in excess of those required for a mine’s normal operation or beyond usual levels, a facility may be applicable to apply for a Mine Rehabilitation PV while it’s still in operation, concurrent with mining activities. Examples of rehabilitation beyond usual levels can include:
Mine rehabilitation activity that is significant and discrete from the operating areas of the mine (e.g. mine rehabilitation of an entire pit),
Mine rehabilitation activity ramping up in the lead up to mine closure phase, and
Mine rehabilitation at the end of a mine’s life following cessation of production
The determination of the production quantity for the Mine Rehabilitation PV is determined from the gigajoules (GJ) of energy that is used for the purpose of mine rehabilitation and are not included under any other Safeguard PV at the facility. Activities included under the Mine Rehabilitation PV include the following:
Haulage of material,
Shaping and contouring of landforms,
Revegetation,
Management of tailings and wastewater, and
Other associated activities (e.g. dust suppression)
To include a Mine Rehabilitation PV at a facility, no submission is required. The CER will use production variable data provided in the company’s NGER report to incorporate the new PV into a facility’s standard baseline, although the CER may request relevant information to inform this action.
For facilities where this is a new Safeguard PV, the best practice emissions intensity for mine rehabilitation is 0.0702 t CO2-e/GJ of energy input to mine rehabilitation (prior to accounting for the decline rate).
How Greenbase can help
If your facility is undertaking rehabilitation activities, you may be eligible for a Mine Rehabilitation PV.
For any questions on whether a facility is eligible to use the Mine Rehabilitation PV or for assistance with any Safeguard-related queries, contact us or speak to one of our Environmental Consultants today at (08) 9322 9966.