Review of the Ozone Protection and Synthetic Greenhouse Gas Management Program

Changes to the Ozone Protection and Synthetic Greenhouse Gas Management Legislation

Following the review of the Ozone Protection and Synthetic Greenhouse Gas Management Program, changes have been made to the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989, the Ozone Protection and Synthetic Greenhouse Gas (Import Levy) Act 1995, the Ozone Protection and Synthetic Greenhouse Gas (Manufacture Levy) Act 1995 and the Ozone Protection and Synthetic Greenhouse Gas Management Regulations 1995. These changes implement the key outcomes of the review.

The major change was the introduction of a phase-down of hydrofluorocarbon (HFC) imports from 1 January 2018, as announced by the Government in June 2016. This will enable Australia to meet the HFC phase-down obligations of the Kigali Amendment to the Montreal Protocol, starting in 2019.

Also included in the changes are most of the efficiency measures announced in the review, including streamlining of licensing provisions, waiving uneconomic levy debts and reduced reporting frequency.

Ongoing legislative amendments will implement further measures including strengthened compliance and enforcement powers and additional program efficiency measures.

Review of the Ozone Protection and Synthetic Greenhouse Gas Management Program

Australia has a long history of success in reducing emissions of ozone depleting substances and synthetic greenhouse gases through working in partnership with businesses that supply and use these gases.

The Minister for the Environment announced a review of the Ozone Protection and Synthetic Greenhouse Gas Program on 24 May 2014. The review had two objectives:

  1. Identify opportunities to reduce emissions of ozone depleting substances and synthetic greenhouse gases in line with international efforts.
  2. Identify opportunities to improve and streamline the program's operation, including reducing regulatory compliance costs.

Outcomes of the Review

The review found that the program was successful overall, having phased out 99% of ozone depleting substances and contributed to a reduction in Australian greenhouse gas emissions of about 40 million tonnes of CO2-e since its inception. The review found this provided a solid foundation for further emissions reduction policies and identified opportunities for streamlining the operation of the program.

On 5 May 2016 the Australian Government decided on a range of measures to improve the efficiency and effectiveness of the Ozone Protection and Synthetic Greenhouse Gas Program. The measures will further reduce emissions of ozone depleting substances and synthetic greenhouse gases and reduce business costs.

Overview of key measures

The key measures stemming from the review are outlined below.

Emissions reduction

The key emissions reduction measure is an 85% phase-down of hydrofluorocarbon (HFC) imports, commencing on 1 January 2018, with the 85% phase-down being reached from 2036. The phase-down will provide certainty for business and position Australia well to meet any future international obligations to phase-down hydrofluorocarbons.

Measures to compliment the HFC phase-down:

  • Provision for bans on the import and manufacture of specified equipment containing specified high global warming potential HFCs. Through a future review of the effectiveness of the phase-down the Government will consider the need for equipment bans. For example new motor vehicle air conditioning systems using the refrigerant R134a may be considered for an equipment ban.
  • Strengthened compliance powers. This will include new offence provisions, infringement notices for refrigeration and air conditioning and fire protection schemes, and the ability to suspend licences.
Streamlining and effectiveness measures

The streamlining measures reduce the burden on business. The key measures are:

  • increase the low volume import exemption to 25 kilograms
  • lengthen the duration of end use permits to 3 years
  • introduce licence renewals
  • reduce reporting requirements from quarterly to twice yearly, while retaining flexibility for more frequent reporting if licence holders prefer to do so
  • waiver of small levy debts up to $330, reducing the number of invoices issued by 94% from 2,750 to 150.
Non-regulatory measures

The Department will develop an education program working with business to better inform equipment owners of the benefits of regular equipment maintenance. This will achieve substantial emissions savings through reduced gas leakage and lower electricity use, and businesses will benefit through reduced electricity costs and reduced replacement costs for gas leakage.

The Department will engage with state regulators and the business community to examine how the Act can work in better synergy with State-level regulation that relates to the refrigeration and air conditioning sector.

Next steps

The Department has implemented the majority of these measures through changes to legislation. Further changes are ongoing.

Extensive consultation since the review began in 2014 has allowed stakeholders to prepare for the changes that affect them. The Department will continue to consult with affected stakeholders as the design of measures is finalised and welcomes feedback on the implementation of the review measures.

The review process

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Terms of Reference and initial public consultation (May - July 2014)

The initial public consultation commenced on 23 May 2014 and ended on 18 July 2014.

Technical Working Group (May 2014 - September 2015)

The Technical Working Group to the review was established to provide detailed comments and technical advice to the Department throughout the review. The Technical Working Group is made up of representatives from a range of industries impacted by the legislation.

Technical Working Group members are: Victorian Automobile Chamber of Commerce, Australian Industry Group, Fire Protection Association of Australia, Plastics and Chemicals Industry Association Australia, Refrigerant Reclaim Australia, Automotive Air conditioning, Electrical and Cooling Technicians of Australia (VASA), Australian Institute of Refrigeration, Air conditioning and Heating, Air conditioning and Mechanical Contractors Association, Air conditioning and Refrigeration Equipment Manufacturers Association, Refrigerants Australia, Australian Refrigeration Association.

Options Paper and public information sessions (October - November 2015)

The Options Paper was prepared to seek further input from interested businesses, groups and individuals on the Review. It was developed after receiving public submissions, as well as consultation with an industry representative technical working group, individual stakeholders, and Commonwealth agencies. The consultation period on the Options Paper was from 6 October 2015 to 16 November 2015.

Information sessions on the Review (October 2015)

Information sessions on the review were held in Sydney on 20 October 2015, Melbourne on 21 October 2015, and Brisbane on 22 October 2015. The presentation provided at the information sessions is available for your information.

Other stakeholder engagement (November 2015 - April 2016)

The Department continued to consult with relevant stakeholders on specific policy matters from November 2015 – April 2016 to ensure that key measures stemming from the review were developed with those who would be most affected.

Action taken in other countries

The following information is provided as useful background on action taken in other countries

Additional information submitted by Canada and the United States

Emissions reduction

A report was commissioned in 2015 to provide detailed information on the direct and indirect emissions reduction achieved from the Ozone Protection and Synthetic Greenhouse Gas Program and present direct and indirect emissions reduction potential from additional (new) measures in the Program.

A Regulation Impact Statement was undertaken in 2016 as part of the review process to examine options to reduce emissions of hydrofluorocarbons (HFCs).