Department of Sustainability, Environment, Water, Population and Communities, 2012
Outcome 2: Operation of the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989
The Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 is the legislative mechanism under which Australia meets its obligations to phase out ozone- depleting substances under the Montreal Protocol, and limit greenhouse gas emissions by controlling the use of synthetic greenhouse gases under the Kyoto Protocol.
The Act controls the import, export, manufacture, acquisition, use, storage, handling and disposal of these substances. In implementing these measures, Australia has adopted a progressive approach. Australia has a longstanding agreement between state, territory and the Australian governments and industry for an accelerated phase out of ozone-depleting substances. Australia will meet its Montreal Protocol obligations on hydrochlorofluorocarbons (HCFCs) by achieving phase-out of 99.5per cent in 2016, four years ahead of our obligation. In the process, in the period from 1996 to 2020 Australia will use some 60per cent less HCFCs than permitted under the Montreal Protocol. Australia has adopted parallel import, manufacture and end-use controls for synthetic greenhouse gases, as these are common replacements for ozone-depleting substances. This initiative provides a consistent approach for industry, resulting in reduced emissions of these substances.
The Commonwealth Parliament passed legislation in November 2011 to amend the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 to apply an equivalent carbon price to synthetic greenhouse gases through the Ozone Protection and Synthetic Greenhouse Gas (Import Levy) Act 1995 and the Ozone Protection and Synthetic Greenhouse Gas (Manufacture Levy) Act 1995. These amendments also expanded the scope to include sulfur hexafluoride (SF6) and equipment containing synthetic greenhouse gases. These amendments became effective on 1 July 2012.
The purpose of the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 is to:
- implement the provisions of the 1985 Vienna Convention for the Protection of the Ozone Layer and the 1987 Montreal Protocol on Substances that Deplete the Ozone Layer
- institute specific controls on the manufacture, import, export, distribution and use of ozone-depleting substances
- encourage Australian industry to replace ozone-depleting substances and achieve a faster and greater reduction than is provided for in the Vienna Convention and the Montreal Protocol to the extent that is reasonably possible, given the availability of suitable alternative substances and appropriate technology and devices
- control the manufacture, import, export and use of synthetic greenhouse gases that are used to replace ozone-depleting substances, to give effect to Australia’s obligations under the United Nations Framework Convention on Climate Change and the Kyoto Protocol
- promote the responsible use of ozone-depleting substances and synthetic greenhouse gases to minimise their effect on the atmosphere.
The Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 provides for a licensing system to enable Australia to meet its international obligations. The Act applies consistent controls on the use of ozone-depleting substances, and the synthetic greenhouse gases used to replace them, to minimise the emission of these substances to the atmosphere. The Act:
- prohibits the import, export or manufacture of chlorofluorocarbons (CFCs), halons (halon 1211, 1301 and 2402), carbon tetrachloride, methyl chloroform, bromochloromethane and hydrobromofluorocarbons without either an essential-use licence or a used-substance licence
- establishes a system of controlled substance licences and reporting requirements for the import, export or manufacture of HCFCs, methyl bromide, hydrofluorocarbons (HFCs) and perfluorocarbons (PFCs), consistent with Australia’s obligations under the Montreal Protocol and the United Nations Framework Convention on Climate Change
- will require from 1 July 2012, a controlled substances licence for the import, export and manufacture of sulfur hexafluoride
- establishes a licensing system for the import of refrigeration and air conditioning equipment that contains an HFC or HCFC refrigerant charge (precharged equipment), thereby applying the same conditions and responsibilities for these substances when imported in equipment that applies to their importation in bulk form
- expands licensing requirements to all equipment containing synthetic greenhouse gases from 1 July 2012, unless an exemption has been granted.
Australia has legally binding obligations under the Montreal Protocol to phase-out HCFCs, and the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 prescribes the quota for the quantity of controlled HCFCs that can be imported into Australia. The quota reduced from 70 ozone-depleting potential 1 (ODP) tonnes in 2010 and 2011 to 40ODP tonnes per year for 2012 and 2013. It will further reduce by 10 ODP tonnes per year in 2014 and 2015, and from 2016 2.5 ODP tonnes can be imported annually for equipment servicing until completion of the phase out in 2030.
The Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 provides for administrative fees for licences to be levied at the levels set under the Ozone Protection and Synthetic Greenhouse Gas Management Regulations1995. The Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 also established the Ozone Protection and Synthetic Greenhouse Gas (SGG) Account. This allows revenue from the licensing system, the cost recovery component of the import and manufacture levies and the National Halon Bank, to be directed towards the cost of administration, phase out programs for ozone-depleting substances, emission minimisation programs and the operation of the National Halon Bank.
The Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 creates regulation-making powers to allow the Australian Government to develop end-use controls on acquisition, purchase, sale, handling, use, storage and disposal of ozone-depleting substances and synthetic greenhouse gases.
End-use regulations have been implemented for the use of ozone-depleting and synthetic greenhouse gases in the refrigeration and air conditioning and fire protection industries. Regulations also control the use of methyl bromide as a feedstock and as a fumigant for approved critical uses, and quarantine and pre-shipment uses.
These regulations assist Australia to meet its phase out obligations under the Montreal Protocol. They also lead to reduced emissions of ozone-depleting substances and synthetic greenhouse gases through the establishment of minimum industry standards.
The Australian Refrigeration Council (ARC) and the Fire Protection Association of Australia administer the permit schemes in the refrigeration and air conditioning industry and the fire protection industry respectively.
Holders of import licences under the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 are required to meet product stewardship obligations by joining an approved product stewardship scheme as a licence condition. The Refrigerant Reclaim Australia scheme obliged its members to pay a levy of $2 for every kilogram of ozone depleting substance or synthetic greenhouse gas refrigerant that they imported. This money was used to fund the collection of used refrigerant at end-of-life, and its subsequent destruction.
In 2011, Refrigerant Reclaim Australia collected 567 tonnes and destroyed 510 tonnes of ozone-depleting and synthetic greenhouse gas refrigerants 2. Refrigerant recovery exceeded destruction in 2011 due to the increased volume of recovered material and delays in destroying waste refrigerant. The remainder is expected to be destroyed by the end of 2012. The amount of gas reclaimed and destroyed continues to increase.
Four types of licences can be issued under the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989:
- Controlled substances licences. Used to import (in bulk), export and manufacture HFCs, PFCs and/or SF6, known as synthetic greenhouse gases, HCFCs and methyl bromide.
- Precharged equipment licences. Used to import equipment that contains ozone-depleting substances or synthetic greenhouse gases, including air conditioning and refrigeration equipment that contain HFCs or HCFCs.
- Essential-uses licences. Since 1996 the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 has prohibited the import, export and manufacture of CFCs, halons, methyl chloroform, carbon tetrachloride, and bromochloromethane without an essential-uses licence. Such licences are only granted for a strictly limited range of essential uses approved by the parties to the Montreal Protocol.
- Used-substance licences. Since 1996, the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 has prohibited the import and export of used or recycled HCFCs, methyl bromide, bromochloromethane, CFCs, halon, carbon tetrachloride and methyl chloroform without a used-substance licence.
Precharged equipment licences were previously valid for a fixed two-year period, but after amendments to the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 became effective in May 2011 these licences are now valid for two years from the date of issue, which reduces the administrative burden on business. There is one type of exemption under Section 40 of the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 for essential use.
The Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 prohibits the import or manufacture of products listed in Schedule 4 of the Act that contain or use a specified ozone-depleting substance unless the minister grants an exemption under Section 40 of the Act or the Regulations. Only a very limited range of products will meet the exemption criteria.
There were 1767 licences active during the 2011-12 licensing period. This figure includes both new licences and those that were active for part of 2011-12 but then expired in that year. It excludes one-off licences for imports of less than five items of equipment containing less than 10kg of refrigerant.
|Type of licence||Number|
|Controlled substances HCFC||8|
|Controlled substances HFC||31|
|Controlled substances methyl bromide||8|
|Precharged refrigeration and air conditioning equipment||823|
|Section 40 exemptions||19|
In 2011, 70.92 ODP tonnes of bulk ozone-depleting substances were imported into Australia. A further 2.34 ODP tonnes were imported in refrigeration and air conditioning equipment.
In 2011, 6676.17 CO2e kilotonnes of bulk hydrofluorocarbons were imported into Australia. A further 3691.66 CO2e kilotonnes of hydrofluorocarbons were imported into Australia in refrigeration and air conditioning equipment.
The Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 provides for licence and exemption application fees to be levied.
|Type of licence/exemption||Fee|
|Controlled substance||$15,000 per licence period|
|Precharged equipment||$3,000 per licence period On application the fee can be reduced to $400 for single-use low volume import licence|
|Essential use||$3,000 per licence period|
|Used substance||$15,000 per licence period|
|Section 40||$3,000 per exemption period|
Levies on imports and manufacturing activity under a controlled substance licence are payable each quarter under the Ozone Protection and Synthetic Greenhouse Gas (Import Levy) Act 1995 and the Ozone Protection and Synthetic Greenhouse Gas (Manufacture Levy) Act 1995. The levies are applied according to the quantity and ozone-depleting potential of HCFCs imported or manufactured, or the quantity of methyl bromide, HFCs or PFCs imported or manufactured (see Table 4). Australia has not manufactured ozone-depleting substances since 1996 and has never manufactured HFCs or PFCs. From 1 July 2012, an equivalent carbon price on synthetic greenhouse gases will be applied through the Levy Acts.
|Import HCFCs||$3,000 per ODP tonne|
|Import HFCs and PFCs||$165 per metric tonne|
|Import methyl bromide||$135 per metric tonne|
Licence fees and levies are charged on a cost recovery basis. These fees are held in the Ozone Protection and SGG Account, which is managed by the department. The purpose of the account is to reimburse the government for the costs associated with:
- administration of the Act and Regulations
- progressing the ozone-depleting substance phase-out and the ozone-depleting substance and synthetic greenhouse gas emission-minimisation programs
- management of the National Halon Bank.
Funds received during 2011-12 from operation of the National Halon Bank and licence fees and levies are shown in Table 5.
|Activity||Amount received in 2011-12 ($)|
|Levies||1 369 103|
|Licence fees||3 462 868|
|National Halon Bank sales and services||752 690|
|Refrigeration fees||6 128 995|
|Total||11 713 656|
Projects funded from the Ozone Protection and SGG Account
The department supports ozone research, including by the implementation of its Ozone Science Strategy (2009). The goal is to support nationally coordinated stratospheric ozone research in Australia that contributes to a better understanding globally of ozone protection and recovery. The activities that occur under the strategy include:
- support of a group of Australian ozone scientists to cooperate and contribute relevant stratospheric ozone research internationally
- an annual top-up scholarship to a PhD student undertaking research that will improve our understanding of atmospheric ozone depletion and recovery
- providing guidance to the Australian Government and research organisations on
priorities for ozone research and encouragement to align research priorities with Montreal Protocol priorities
- seed funding to leverage additional funding for ozone research.
The Ozone Science Group is an informal group made up of Australian scientists and departmental representatives interested in stratospheric ozone science; their work assists with the implementation of the Ozone Science Strategy. The group was established in 2007 as a means to encourage cooperation and coordination among Australia’s stratospheric ozone interests. It comprises key Australian ozone scientists from the Australian Antarctic Division, Bureau of Meteorology, CSIRO Marine and Atmospheric Research, the Australian Radiation Protection and Nuclear Safety Agency, and a number of research universities. The group met four times during 2011-12 to share information about developments in ozone science and research, to coordinate their activities and to cooperate on specific projects.
The top-up scholarship for a student commencing a PhD this year was advertised and awarded to an applicant undertaking a PhD at the University of Melbourne.
The Ozone Science Strategy was reviewed in 2012 and a number of changes were made to enhance its functioning, including improving linkages to other research groups, policy making and international research, streamlined administration of the postgraduate scholarship, consideration of seed funding on a case-by-case basis, and possible assistance to ozone scientists to participate in international assessments.
CSIRO and the department continued to cooperate on monitoring global concentrations of ozone-depleting substances in the atmosphere and estimating emissions of these gases from Australia in 2011-12. These projects showed that in 2010 projected emissions of ozone-depleting substances from Australia decreased in line with our decreasing consumption of these gases.
Refrigeration and air conditioning
The Ozone Protection and Synthetic Greenhouse Gas Management Regulations1995 establish a competency-based permit scheme for the refrigeration and air conditioning industry in Australia. Four types of permits are issued:
- Refrigerant Handling Licence allows the holder to handle controlled refrigerants in the refrigeration and air conditioning industry.
- Refrigerant Trading Authorisation allows the holder to acquire, possess and dispose of controlled refrigerants.
- Restricted Refrigerant Trading Authorisation allows the holder to acquire, possess and dispose of controlled refrigerants but only where they have been reclaimed from end-of-life refrigeration and air conditioning equipment, and only where the refrigerant is supplied to the operator of an approved refrigerant destruction facility.
- Refrigeration Equipment Manufacturers Authorisation allows the holder to acquire and use controlled refrigerants in the manufacture of refrigeration and air conditioning equipment.
The operation of the permit scheme is contracted to the Australian Refrigeration Council.
Compliance and enforcement activities
The Australian Refrigeration Council conducts a compliance audit program under its contract. A range of audits are conducted, including on-site (planned, scheduled audits), remote (paper-based), desktop (telephone-based) and drive-by (randomaudits). Technical assistance is also provided to the Australian Customs and Border Protection Service where illegal import is suspected, and the ARC follows up complaints about permit holders. The ARC manages low-level compliance issues. Of the 4442 compliance audits (on-site and remote) conducted in 2011-12, 3580 licence holders were found to be compliant at the time of audit. Of the 862 licence holders found to be non-compliant, 345 became compliant as a result of compliance education activities by the ARC. Of the 517 cases that remained non-compliant, 427 will be further managed by the ARC. The ARC refers cases of extended non-compliance to the department for management. Ninety cases were referred to the department in 2011-12. Of these, 52 achieved compliance, with the remaining cases still in progress at the end of 2011-12.
|On-site and remote audits||4442|
|Complaint-related site visits||45|
The permit system operated by the ARC collected $6,139,156 in permit application fees to 1 July 2012. The department paid the ARC $4,631,274 (GST exclusive) in operating expenses over the same period.
The Ozone Protection and Synthetic Greenhouse Gas Management Regulations established a competency-based permit scheme for the fire protection industry in Australia for systems using halocarbon-extinguishing agents. Four types of permits are issued:
- Authorisations allow the holder to acquire, possess and dispose of controlled fire extinguishing agents.
- Licences allow the holder to handle controlled fire extinguishing agents in the fire protection industry.
- Halon special permits allow the holder to possess halon that is for use in fire protection equipment.
- Special purpose exemptions entitle the person to the privileges of holders of one or more of the above permits as specified in the exemption.
|Halon special permits||35|
|Special purpose exemptions||0|
The permit system operated by the Fire Protection Association of Australia collected $162,900 to 30 June 2012 in permit application fees. The department paid the Fire Protection Association of Australia $436,391 in operating expenses over the same period.
Montreal Protocol’s Multilateral Fund
Australia provides financial assistance through the Montreal Protocol’s Multilateral Fund to assist developing countries to comply with the phase out requirements under the protocol. In 2011, Australia was one of 14 members of the Executive Committee of the Multilateral Fund. The committee oversees governance of the funding, including considering project approvals and outcomes. Australia chaired the Executive Committee in 2011. Australia continued to participate in the Executive Committee in 2012, sharing membership with Canada.
1 Ozone-depleting potential is a comparative measure, using chlorofluorocarbon as a base level of 1. For example, 1 metric tonne of methyl bromide equals 0.6 ozone-depleting potential tonnes.
2 Reported figures are for the 2011 calendar year to align with calendar year reporting to the Montreal Protocol on Substances that Deplete the Ozone Layer.