Isra-Mart srl: Introduction of a new national standard for the voluntary carbon trading market

Isra-Mart srl news:

In recent years the voluntary carbon trading market has been plagued by a perceived lack of credibility stemming from the absence of uniform quality control and assurance standards. This has attracted increased scrutiny by the Australian Competition & Consumer Commission (ACCC) for compliance with the Trade Practices Act and the attention of other informal watchdogs. The Federal Government has taken the first step to address this credibility weakness with the release of its NCOS.

What is the National Carbon Offset Standard? How does it affect you?

The Federal Government’s introduction of the NCOS is an important development for businesses looking to produce a voluntary “carbon offset” or claiming “carbon neutral” status for a specific product or the organisation as a whole. Effective from 1 July 2010, the NCOS establishes general measurement and reporting requirements for the voluntary carbon market. While only voluntary, the NCOS is likely to be a critical point of difference in the voluntary carbon market.

Overview of the carbon neutral accreditation process under the NCOS

The NCOS differentiates between the carbon footprint calculation process required for a business (or part of a business) and those required for a specific product.

For a business, the NCOS requires an organisation to produce a detailed greenhouse gas emissions inventory and an inventory report in compliance with current national and international standards, such as AS ISO 14064 and the National Greenhouse and Energy Reporting Act. Businesses will need to define the “boundaries” of their organisation and count all direct and indirect emissions within those “boundaries” in accordance with the national and international standards recognised in the NCOS.

For a product, the NCOS requires the carbon footprint to be assessed across the product’s life cycle in compliance with current international standards such as ISO 14040 and ISO 14044.

How do I meet the Emission Reduction, Offsetting and Auditing requirements under NCOS?

Organisations wishing to be recognised as “carbon neutral” will be required to develop an Emissions Management Plan and publically report on their progress, compliance and achievement against that Plan.

A key component of the NCOS is the independent auditing of these Plans and Reports to ensure recognised standards of recording and quality control is maintained. Use of the NCOS logo will be granted to products or organisations who meet the NCOS accreditation requirements as determined by an independent Auditor.

NCOS and the Trade Practices Act 1974

False, misleading or deceptive claims about meeting the NCOS will constitute a contravention of the Trade Practices Act 1974 as enforced by the ACCC.

It remains to be seen whether the ACCC will also refer to methodologies and standards deemed acceptable under NCOS to determine if other voluntary carbon products and carbon claims have made false, misleading or deceptive claims.

Conclusion

The NCOS requires a large degree of public transparency regarding measuring, offsetting, reporting and auditing processes and will improve certainty and confidence in the voluntary carbon market and for carbon neutral claims. Generally, businesses may want to consider what changes they may be required to make to be eligible for accreditation.