Challenges and opportunities in Australian greenhouse gas storage legislation: insights from the CarbonNet project

Abstract

Co-funded by the Victorian and Australian Governments, the CarbonNet Project (CarbonNet) was established in 2009 to enable commercial deployment of carbon capture and storage (CCS). The duration and first-of-a-kind nature of the project has also provided an opportunity to test the Australian legislative greenhouse gas (GHG) framework. Although the Commonwealth legislative regime has comprehensive GHG legislation in place, one of the recognised barriers to geological storage in Australia is permitting and regulatory complexity. CarbonNet’s practical application of the legislation has emphasised that regulatory maturity will only be achieved once a number of projects have been permitted through the full project lifecycle. While the project has achieved many regulatory firsts, there have been several policy and regulatory challenges. Successes have come via legislative reform, scientific investigation and collaboration, and stakeholder engagement and communication. This paper provides insights into CarbonNet’s regulatory journey and key learnings in testing first-of-a-kind regulatory processes. It also explores opportunities for improvement in the GHG regulatory framework, while noting the progress of recent legislative reform and government collaboration. The paper concludes with a recognition of the need for the CCS regulatory framework to be straightforward, fit-for-purpose, proportionate, risk-based, and not overly prescriptive or complex. CCS projects may span decades and require significant upfront investment from multiple companies or consortia. Proponents and investors require confidence in the regulatory framework underpinning a project before making these large commitments. Accordingly, there is a key role for both Australian and State governments in providing the enabling legislative and regulatory framework for CCS projects.