Companies that exceed specified facility or corporate emissions thresholds are required under the National Greenhouse Emissions Reporting Act 2008 (NGER Act) to measure and report greenhouse gas emissions and energy consumption/production. There are considerable penalties for the company as well as individuals (i.e. CEO, CFO) if found by the regulator to be non-compliant with the NGER Act.
In order to comply with the NGER Act, the following approach should be considered for implementation:
- Governance: Ensure NGER compliance is addressed within the company governance structure.
- Resources: Ensure adequate resources are available.
- Commitment: Develop a vision and policy with regard to greenhouse gas emissions.
- Systems: Ensure procedures, work instructions and forms are reviewed or developed to describe how the company will meet NGER Act requirements.
The CEO is be responsible for communicating NGER Act compliance to the Board. The risk and audit subcommittee of the Board should be responsible for monitoring risk associated with changes to or introduction of legislation with respect to greenhouse gas emissions, and monitoring compliance with the NGER Act, as well as reviewing audit outcomes specific to the NGER Act. This should be incorporated into the Audit and Risk Subcommittee Charter. A Carbon Working Group, consisting of managers from finance, corporate environment, facility resident managers, and facility environmental representatives, should be formed to be proactive with regard to requests from and report to the Audit and Risk Subcommittee on matters relating to greenhouse gas emissions. A champion for NGER Act compliance (most likely the Environmental Manager) should oversee all actions relating to the implementation of the above listed approach.
Resources to be considered for the implementation of NGER Act requirements includes:
- Personnel: Additional personnel may be required or review of the capability of existing personnel to implement the data collection requirements of the NGER Act.
- Budget: A budget will need to be developed and approved to address the resource requirements listed here, and the implementation of the approach described in this document.
- Consultants: Training, development of documentation for systems described below, compilation of data and NGER reports, guidance on determination of operational control and boundaries, external audit to measure and provide certainty on compliance, legal advice on interpretation of the NGER Act and contractual development for existing and new contractors.
- Equipment: Additional equipment may be required at facilities to ensure accurate data collection. An equipment list is required when data collection points are identified.
- IT systems: A review of IT systems in place or the requirements for a new one with capability for data storage, collation and reporting is required.
- Time: The time required to collect and collate data and report along with personnel capability should also be assessed.
The Board should develop a vision with regard to greenhouse gas emissions (e.g. is the vision to be carbon positive or just to comply with reporting requirements). The CEO, and senior management will develop, endorse and communicate a policy, with the aid of the Environmental Manager.
4. Systems, Procedures, Work Instructions and Forms
The carbon policy (which may be integrated within the environmental policy) should be implemented through the review of the corporate management system, and development and roll out of additional procedures, work instructions and forms. Consideration of NGER Act requirements within the standard operating procedures of the corporate management system should include:
- Legal: NGER Act requirements will be added to the legal obligations register, and changes to legislation will be monitored.
- Document control: all documentation relating to NGER Act implementation will be maintained as per the company’s document control and record keeping procedures.
- Management Plans: A carbon management plan will describe how the company will implement its carbon policy and legal obligations, as well as any proactive measures to reduce or offset carbon emissions (depending on the ambitions of the carbon policy and any associated vision).
- Risk Assessment: Consideration of the NGER Act requirements will be given during annual corporate and technical risk assessment workshops, and action plans will be implemented to mitigate high risk severity.
- Audits and Inspections: Internal and external audits will be undertaken to ensure compliance. An internal audit checklist shall be developed.
- Incident and Corrective Actions: Non-conformances with NGER related data collection processes shall be recorded in the company’s electronic incident register (along with H&S, and environmental incidents) and an investigation of the cause will be carried out.
- Change Management: Implications of changes to equipment, procedures, activities or legislation with regard to greenhouse gas emissions shall be considered through the change management process.
- Objectives and Targets: Objectives and targets for the reduction of greenhouse gas emissions, accuracy of data collection, training of personnel and culture change initiatives shall be determined, and monitored against progress.
- Training: Training requirements for personnel and contractors with regard to NGER Act compliance will need to be identified in the Training Needs Matrix.
- Communication: Internal and external communication will be undertaken using a variety of mechanisms including newsletters, prestart meetings, weekly management meetings, monthly Green committee meetings, annual NGER reporting, CEO presentations to the Board.
- Contract Management: Consideration of NGER requirements shall be included in contracts. Some of this “approach” may in fact be the responsibility of the contractor (especially in an EPCM situation) but that would depend on the requirements of the contract. I would suggest an Environmental Specification for Contractors document should be referenced within the contract, and the details of the contractor role be included and clearly laid out in this document.
- Management Review: Management will review performance, audit outcomes and incident records to determine effectiveness of compliance with NGER Act and implementation of the policy to determine progress towards achieving the vision.
Work Instructions: A Carbon Emissions Work Instruction(s) shall describe task specific data collection procedures.
Forms: A Monthly Carbon Emissions Form shall be developed to record emissions for the month by functional area managers at each facility.
The above approach should be considered essential going forward. In addition, it is recommended that a similar approach should be implemented regardless of whether or not carbon emissions thresholds are exceeded.