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Landfill gas method

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17 May 2021
CFI ERF

Is the landfill gas method suitable for your business?

  • Are you planning to introduce a new gas collection system or upgrade an existing gas collection system to collect and combust landfill gas?
  • Will the landfill gas collected be combusted using a combustion device such as a flare, boiler, combustion engine or another device that combusts landfill gas with a destruction efficiency of at least 98 per cent?

If you have answered yes to both of these questions, the landfill gas method may be suitable for your business.

The landfill gas method provides an incentive to install a new landfill gas collection system or upgrade an existing system.

The method allows for new, recommencing, upgrade, transitioning and restarting flaring projects.

  • New projects are those that install a new landfill gas collection system where there has never been a system located on any part of the landfill previously.
  • Recommencing projects are those that recommence operation of a new or existing landfill gas collection system at a site where a system previously operated, providing that a landfill gas capture system has not operated at the landfill after 24 April 2014.
  • Upgrade projects are those that upgrade an existing and operating landfill gas collection system to increase the collection efficiency of the system. Upgrade projects must install new wells to increase landfill gas collection efficiency. You could also improve the existing system’s collection efficiency by upgrading the capacity of the combustion devices or installing new software for optimising the operation of the system.
  • Restarting flaring projects are flaring-only projects that were previously a landfill gas project that generated electricity during their crediting period. These projects must not generate electricity after their declaration as a restarting flaring project.

Method variations

The Clean Energy Regulator develops variations to methods for a range of reasons including:

  • to implement an ERAC decision to extend the crediting period of a method
  • to ensure methods continue to operate as originally intended
  • to account for technological advances that enable new measurement approaches.

Methods being varied or methods under review are published on the Department of Industry, Science, Energy and Resources (DISER) website and our method consultation page.

The method variations page provides additional information about how a method variation might affect an existing project.


2021 Landfill gas method variation

The landfill gas method variation came into effect on 7 May 2021. The method has been varied to:

  • extend the crediting period for landfill gas flaring activities by 5 years (new flaring projects receive a 12-year crediting period)
  • change the default methane proportion for landfill gas from 50 per cent to 42 per cent for new projects
  • revise the eligibility requirements for upgrade projects so that new wells must be installed and 4 years of collection efficiency records must be provided at project registration.

If you have a current landfill gas project, you may be able to transfer your project to the varied version of the method. Apply to transfer your project through the Client Portal.

If you do not transfer to the varied method, these changes will not apply to your project.

Legislative requirements

You must read and understand the method and other legislative requirements to conduct a landfill gas project and earn Australian carbon credit units (ACCUs). This includes:

Tools and resources

Quick reference guide to the landfill gas method

Contents


Crediting period

The crediting period is the period of time a project can apply to claim ACCUs.

Under the landfill gas methods, projects that generate electricity have up to a 7-year (84 month) crediting period. The crediting period will end once the project enters its 85th calendar month of electricity generation.

Projects that do not generate electricity and only flare landfill gas, have a 12-year crediting period.

Existing projects transferring to the varied method can get an additional 5 years crediting period from the end of their current crediting period for flaring activities if they have not generated electricity for more than 84 months.

Projects can combine flaring and electricity generation activities with a maximum crediting period of 12 years, of which up to 7 years (84 months) may include electricity generation. As above, the crediting period will end if the project enters its 85th calendar month of electricity generation.

A restarting flaring project has a crediting period of 12 years, minus the length of its crediting period when it was previously a landfill gas project that generated electricity. For a project that generated electricity for 7 years and later re-entered the scheme as a restarting flaring project, this would result in a 5-year crediting period for the restarting flaring project.

Projects that remain on the original 2015 landfill gas method will continue to have the original 7-year crediting period for both flaring and electricity generating activities.

Relevant section of the Act:

Relevant section of the Method:

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Eligibility requirements

There are general eligibility requirements in the Act, which include:

Types of projects are eligible under this method include:

  • a new project, which collects and combusts landfill gas by installing a gas collection system at a site where there has never been a gas collection system
  • an upgrade project, which involves an existing system for which you can provide efficiency records covering at least four years before applying to run the project
  • a recommencing project, which uses a new or existing gas collection system, and did not operate at the site after 24 April 2014 and for three years before applying to run the project
  • a project transitioning from the Carbon Farming Initiative (using either of the two methodology determinations listed in Part 3 section 12 of the method)
  • a restarting flaring project, which has previously been a landfill gas project that generated electricity during its crediting period or periods and are looking at switching back to flaring only. The project must not generate electricity after its declaration as a restarting flaring project.

Relevant section of the Act:

Relevant section of the Method:

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Project activities

A project involves collecting and combusting methane generated by decomposing biodegradable organic matter in the landfill, and converting it to carbon dioxide.

The methane must be combusted using a combustion device. This may be:

  • a flare, boiler or internal combustion engine operated in accordance with the manufacturer’s instructions
  • a device that combusts landfill gas with a destruction efficiency of at least 98 per cent, is operated in accordance with the manufacturer’s instructions and for which the combustion process can be monitored minute-by-minute.

Relevant sections of the Method:

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Exclusions

The method does not credit the destruction of emissions from carbon tax waste, which is waste deposited in landfill between 1 July 2012 and 30 June 2014. It only credits the destruction of emissions from legacy and non-legacy waste:

  • Legacy waste is waste deposited before 1 July 2012, when the carbon pricing mechanism commenced.
  • Non-legacy waste is waste deposited after 30 June 2014, when the carbon pricing mechanism ended.

Relevant section of the Method:

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Abatement calculations

Abatement is calculated by working out the net abatement amount which is project abatement minus baseline abatement.

Project abatement is calculated as the amount of methane combusted from legacy and non-legacy waste, minus the amount of methane that would have been oxidised in the near-surface conditions of the landfill if it was not collected during the project. Part 4 Division 3 of the method deals with the calculations involved in determining project abatement.

Baseline abatement is the amount of methane combusted from legacy and non-legacy waste during the project, multiplied by the proportion of methane that would have been combusted in the absence of the project. Part 4 Division 4 of the method deals with calculating baseline abatement. Some of the major steps involved in calculating baseline abatement include determining:

  • regulatory proportion
  • default baseline proportion
  • baseline proportion.

The regulatory proportion reflects the amount of methane that would have to be combusted to meet quantitative regulatory requirements. Schedule 1 in the method describes how to determine this proportion. It can be determined by:

  • using regulatory guidelines for landfill in your state or territory
  • for new projects – asking your state or territory environmental regulator
  • for upgrade projects – asking your state or territory environmental regulator and calculating the collection efficiency of the existing landfill gas system
  • engaging an independent expert.

The default proportion represents qualitative regulatory requirements, and is either 30 per cent or zero per cent. There are no conditions for applying the 30 per cent default, but the zero per cent default can only be applied if you can demonstrate that no qualitative requirements apply to the landfill. Examples of qualitative requirements include:

  • install or develop a plan to install a landfill gas collection system
  • control or reduce methane concentrations
  • control, manage or limit odour
  • capture landfill gas where practicable.

The baseline proportion depends on the type of project.

  • For new and recommencing projects, it is the higher of the regulatory proportion or the default proportion.
  • For upgrade projects, it is the higher of the regulatory proportion, the default proportion or the proportion of methane combusted during the reporting period that would have been combusted without the project.

Further guidance about how to determine project and baseline abatement can be found in the guide to the landfill gas method located under Tools and Resources.

The Emissions Reduction Fund (ERF) Landfill Gas Calculator (the Calculator), which is designed to assist in calculating project and baseline abatement, is being updated to accommodate the changes resulting from the 2021 LFG variation.

As specified in section 6 of the Method, where factors or parameters are defined by another document, projects must use the other document as in force at the end of the reporting period.

The NGER Measurement Determination was updated on 1 July 2020, in which factors and parameters used to calculate abatement have changed. Two versions of the Calculator have been developed to reflect the previous and current NGER Measurement Determinations:

Please note these calculators contain macros.

Relevant sections of the Method:

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Reporting requirements

In addition to the reporting requirements of the Act and the Rule, the method also sets out the following method-specific requirements for offset reports:

  • Upgrade projects are only able to submit their first report for a reporting period that ends 12 months after the upgrade has taken place. This provides enough data to be able to compare the improvement in collection efficiency from the period prior to the upgrade.
  • Other types of projects can submit their first and subsequent reports for a reporting period between one month to two years.

Relevant section of the Act:

Relevant section of the Rule:

Relevant sections of the Method:

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Monitoring requirements

In addition to the general monitoring requirements of the Act, projects must meet specific monitoring requirements in the method. Section 33 lists these requirements along with the process for monitoring and the standard to which it must adhere.

Relevant section of the Act:

Relevant section of the Method:

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Record-keeping requirements

This method does not have any record-keeping requirements that are additional to the general record keeping requirements of the Act and the Rule.

Relevant section of the Act:

Relevant section of the Rule

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Audits

Audits are an important requirement of the Emissions Reduction Fund and provide assurance over the integrity of Australian carbon credit units (ACCUs). All projects receive an audit schedule when the project is declared and must provide audit reports according to this schedule. A minimum of three audits will be scheduled and additional audits may be triggered. For more information on the audit requirements, see the Act, the Rule and the audit information on our website.

Audits during an extended crediting period

Once you submit an application to transfer your project, the Clean Energy Regulator will be in touch to discuss appropriate auditing during the extended crediting period.

Relevant section of the Act:

Relevant section of the Rule:

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Specialist skills

Specialist skills may be required to carry out the project with the method. Examples of specialist skills include:

  • registered professional engineer
  • certified energy manager
  • certified measurement and verification professional.

Relevant section of the Rule:

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