Buyer beware: “Voluntary” credit NGAC buyers warned NSW government does not verify the green-accounting, of the seller
Posted by gmarkets on 15 September, 2007
Over the past two years, the level of interest in using NSW Greenhouse Abatement Certificates (NGACs) to voluntarily offset greenhouse gas emissions had increased significantly, according to the GGAS Newsletter, of the NSW government, Issue 5, (10/9/2007). “Much of this interest comes from increasing desire to achieve a ‘carbon neutral’ status by individuals and organisations,” the newsletter said. “Evidence suggests NGACs are considered to have broad appeal as a standard instrument traded on the open market representing one tCO2-e of abatement.
For the 2006 calendar year;
• 2,660 NGACs were voluntarily surrendered and this year to date;
• over 6,100 NGACs have been voluntarily surrendered.
To facilitate this ‘voluntary’ market participation, the GGAS Registry was upgraded in 2006 to allow organisations other than benchmark participants (the liable parties) to surrender NGACs. It should be noted that while the Scheme Administrator accepts voluntary surrenders through the Registry, it does not provide any verification as to whether the volume of NGACs surrendered equates to the participant achieving carbon neutrality.”
Surrendered certificates cannot be reused: “To voluntarily surrender (also known as retire) NGACs, an account on the Registry must be opened and NGACs transferred into that account. Certificates can then be surrendered on the Registry.
Not an offset: Purchasing and holding NGACs in a Registry account does not equate to achieving an offset. NGACs must be surrendered to be effective in offsetting a participant’s carbon footprint. There are important deadlines that voluntary participants need to consider when deciding to surrender NGACs. Individuals can voluntarily surrender NGACs at any time between 1 July and 20 June of each financial year.
Certificates that have been surrendered before 20 June of each financial year will be accepted by the Scheme Administrator and on 30 June of each year all surrendered certificates will be cancelled by the Registry and the certificates cannot be un-surrendered or reused. As a tradeable commodity with a market value, voluntary participants should carefully consider the volume of NGACs they wish to surrender to offset their carbon footprint, as once surrendered, the commodity cannot be retrieved.”
Reference: For further information regarding opening and managing an account on the Registry see the Registry FAQs on our website at http://www.greenhousegas.nsw.gov.au/registry/tips.asp
For further information regarding the process for voluntary surrender on the Registry, see the fact sheet on our website at http://www.greenhousegas.nsw.gov.au/documents/syn98.asp
GGAS Newsletter, Issue 5, September 2007,