Underpinned by the Compliance policy for education, monitoring and enforcement activities, the Clean Energy Regulator 2018–19 compliance priorities identify our focus areas for 2018–19.
The compliance priorities aim to increase our client’s awareness and willingness to comply voluntarily to meet our agency objectives, and highlights particular areas that we will focus on for each of the schemes we administer.
This companion piece has been developed to guide auditors in addressing the 2018–19 compliance priorities. The Clean Energy Regulator expects registered greenhouse and energy auditors to address these priorities in all assurance engagements carried out under our schemes.
Auditors in doubt about requirements under our schemes, or require assistance with legislative interpretation, should contact us at the Clean Energy Regulator.
To ensure that Emissions Reduction Fund regeneration projects receive Australian Carbon Credit Units (ACCUs) for genuine and additional abatement by:
Auditors should have regard to the relevance and accuracy of field data and available geospatial algorithms including:
Additionally, for all claims going forward auditors will need to test whether Clean Energy Regulator guidance has been applied in determining Carbon Estimated Areas, forest cover and forest potential.
The Clean Energy Regulator is always looking to use the most granular spatial imagery available, including high resolution or field sampling spatial imagery. Where more than one imagery data source is available, auditors are encouraged to refer to all sources as appropriate. Auditors should also ensure that they consider relevant spatial imagery available under each method.
High resolution imagery can also be used to spot check compliance systems developed by reporters. Auditors are encouraged to refer to the Carbon Farming Initiative Mapping Guidelines for further details of spatial mapping requirements.
Auditors should ensure they note all observations of record keeping failures in Part B of the audit report.
Auditors should have regard to the specific record keeping requirements, as outlined in each method, as well as overarching requirements in the CFI act.
Auditors should also ensure that reporters maintain accurate and relevant records relating to the eligibility and calibration of monitoring equipment.
Where critical information is absent auditors should use their judgement in appropriately modifying their opinion.
Refusing over-claims and investigating where false and misleading information is provided. Where proven, the agency will consider options including removal from the scheme on fit and proper person grounds, relinquishment of ACCUs, pursuit of debts and court action.
Auditors should ensure the risk of fraud is considered in the planning and testing of any audit, where any instances of false and misleading information is provided, it should be immediately reported to the Clean Energy Regulator and included in the audit report.
Auditors should also consider the arrangement between proponents and agents and include the risk of agent committed fraud as part of the planning and testing of an audit.
Whilst an over claim may be immaterial, we expect that this will be reported in Part B of the audit report.
Auditors should place a high priority on ensuring consents are given and demonstrate professional scepticism in testing any documents related to legal right and consent. Auditors must confirm with relevant parties that consent is obtained from all relevant parties and use their judgement as to when this should be undertaken.
Auditors should also be mindful that the arrangements for legal right and native title may change over the life of a project. Auditors will need to ensure that they include legal right and native title testing as part of subsequent audits and should not be relying on the testing conducted in previous audits.
Failure to obtain appropriate legal right or consent may be a material finding in an audit and auditors should modify their opinions accordingly.
Not directly applicable to audit activities. However, contract delivery dates may encourage project proponents to seek truncated audit timeframes.
Auditors must ensure they have sufficient time to effectively undertake an audit.
Contract delivery timeframes should be not accepted as a reason for an unreasonably short timeframe to conduct an audit.
To support the consistency and accuracy of emissions and energy data in the oil and gas, coal mining, power generation and transmission, and landfill sectors by:
Auditors should use guidance and are encouraged to incorporate these guides and directions in the planning and conduct of audits. If reporters are not reporting consistent with the guidance, auditors will need to ensure that the reporters can demonstrate that they are reporting consistent with the legislation. If a reporter’s interpretation of the legislation is inconsistent with the guidance, auditors will need to document in Part B of the audit report how they agreed it was compliant with the legislation.
Auditors should note that these guides are for industry-wide application and case specific matters may arise that still require close consideration of the legislative requirements, for which the guidance may not have specific information.
Where available, auditors should have regard to a reporter’s historical submission records. Where a reporter has a history of non-compliance or submitting inaccurate data, this information should be included as part of the auditor’s risk assessment process. Auditors will need to design appropriate assurance procedures to reduce any identified risks to an acceptable level.
To assess the accuracy of claims for calculated baselines for safeguard facilities by:
Auditors will need to be aware of any engagement between the responsible emitter and the Clean Energy Regulator, with particular attention to any advice provided on:
Auditors are encouraged to continue engaging with the Clean Energy Regulator on any advice provided to a responsible emitter that is unclear, or that does not appear to have reached an appropriate resolution.
Auditors should also note that the initial calculated baseline criteria is no longer available for applications made after 31 October 2017. Applications can be made under the following criteria:
To ensure that embedded generators on mine sites are properly identifying and reporting as RET liable entities we will:
In audits of RET liable entities and power stations, auditors should ensure that they consider self-generation as a key risk area including how self-generation is recorded and considered.
Any instances of self-generation should be noted in the audit report.
To ensure that only eligible renewable generation receives the right number of large-scale generation certificates (LGCs) by:
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