Under the GGAS legislation, IPART has strong auditing and enforcement powers to ensure that:

• Benchmark Participants meet their emission-reduction targets, and
• abatement certificate providers are accredited and create abatement certificates in accordance with the Act, Regulation and relevant Scheme Rule.

The legislation does not prescribe a particular audit approach, therefore a risk-based approach has been established to determine when audits are required. The Audit Panel is relied upon to carry out all audit activity and the quality and independence of audits is monitored closely to ensure the objectives of GGAS are met.

The key objectives of the audit framework are to:

• support the policy objectives of the legislative framework and GGAS Rules
• minimise the risk of:
• inappropriate accreditation of abatement certificate providers
• invalid creation of abatement certificates
• incorrect calculation of liabilities by Benchmark Participants
• assist IPART in monitoring compliance of benchmark participants and abatement certificate providers with relevant legislation and the GGAS Rules
• ensure that information provided by participants is reliable, complete and fairly represented
• support the general transparency and integrity of GGAS.

A risk - based framework

Audits of abatement certificate providers

When applicants seek accreditation as abatement certificate providers the Scheme Administrator considers the information provided by the applicant, and the complexity and the scale of the abatement project in deciding whether to audit the project’s eligibility. Where risk is very low, the Scheme Administrator may determine that an audit is not required prior to accreditation. However, in the majority of cases, applicants are audited as part of the accreditation process. The quality and nature of the information submitted in the application form will mitigate the need for an audit.

Similarly, when the Scheme Administrator accredits abatement certificate providers it considers the potential risks to GGAS in deciding on the ongoing audit requirements. The frequency of audits required is defined in the abatement certificate provider’s conditions of accreditation. Complex abatement projects creating large volumes of certificates are typically being audited prior to certificates first being registered. Less complex projects creating fewer certificates are audited less frequently and after the certificates have been registered, e.g., annually or on a spot basis.

The risk profile is assessed using the following criteria:

• The extent of information provided in response to the question in the application form
• The participant’s compliance history
• The complexity of the abatement project
• The number of projects that share a common process, and
• Any other factors that the Scheme Administrator considers relevant.

The Scheme Administrator may change the audit requirements for an abatement certificate provider to reflect its performance in previous audits. Where an abatement certificate provider has had successful audits, the Scheme Administrator has sometimes been willing to adjust its conditions of accreditation to require fewer audits.

Audits of Benchmark Participants

It is critical to the success of the Scheme that Benchmark Participants meet their emission-reduction targets. As such, the Compliance Regulator has determined that, in general, all Greenhouse Gas Benchmark Statements shall be subject to audit. However, Benchmark Participants that have zero electricity purchases (i.e. have a nil return) will not be audited.