Submission: National Greenhouse and Energy Reporting (NGER) scheme – 2024 proposed updates

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24 May 2024

To: The Department of Climate Change, Energy, the Environment and Water
RE: National Greenhouse and Energy Reporting (NGER) scheme – 2024 proposed updates

Thank you for the opportunity for the Institute for Energy Economics and Financial Analysis (IEEFA) to provide input on the National Greenhouse and Energy Reporting (NGER) scheme – 2024 proposed updates.

IEEFA is an independent energy finance think tank that examines issues related to energy markets, trends, and policies. The Institute’s mission is to accelerate the transition to a diverse, sustainable, and profitable energy economy.

This submission comments on the proposed amendments to provisions relating to fugitive methane emissions from coal mining in Australia. IEEFA supports the Climate Change Authority (CCA)’s proposed update to phase out Method 1 for open-cut coal mine methane estimations, but also proposes a phase-out of Method 2 and updates to Method 3. Overall, changes to the NGER scheme should prioritise supporting open-cut coal mining companies to move towards direct measurement methods, and improve the reporting requirements to make emissions data more readily available to the public.
 

Kind regards,
 

Anne-Louise Knight, Lead Research Analyst – Australian Coal, IEEFA
Andrew Gorringe, Energy Finance Analyst – Australian Coal, IEEFA

Summary

The longer it takes to improve accuracy in methane emissions reporting from coal mining, the harder it will be for Australia to accurately report on its national greenhouse gas emissions reduction efforts, and the more difficult it will become for independent research bodies to analyse the economic feasibility of emission reduction pathways.

1. IEEFA supports the CCA’s recommendation to phase out Method 1 for estimating open-cut coal mine emissions.
2. The phase-out of Method 1 for estimating emissions should occur simultaneously with a phase-out of Method 2 and support a shift towards site-specific direct measurement methods as soon as possible. Method 2 still poses multiple levels of risk for significant underreporting to occur, with the potential for underreporting to worsen.
3. IEEFA is of the view that Method 3 should remain the lowest-order estimation method permitted for open-cut coal mines, with the associated standards referenced under Method 3 to be reviewed and updated as a matter of urgency, and a requirement for external peer review or independent verification processes to be added.
4. IEEFA questions the proposed two-year timeframe for coal mines to switch from Method 1 to Method 2 given that Method 2 is already a prevalent reporting method.
5. Methane emissions from abandoned, mothballed or decommissioned open-cut coal mines should also be accounted for.
6. IEEFA supports the CCA’s view that there is a need to increase the availability of higher order methods for methane emission estimations. Moving towards direct measurement of methane emissions is crucial for Australian governments to make progress on emissions reduction strategies.
7. Currently the ability for the public to have their say on the implementation of Methods 2 and 3 is constrained by the privatisation of the methodology guidelines, which are only available online behind a paywall.
8. IEEFA supports the CCA’s recommendation to develop a policy framework for implementing independent verification of facility-level fugitive methane emissions estimates using top-down measurements.
9. IEEFA supports the CCA’s view that data transparency under the NGER scheme improves by making facility-level emissions data (including of greenhouse gas) publicly available. IEEFA is of the view that all coal mines in Australia should be required to report on this data and that they should also state which method was used to estimate methane emissions.
10. The GWP100 conversion rate used in the NGER scheme should be updated based on the Intergovernmental Panel on Climate Change (IPCC)’s latest Assessment Report.