True

Rating: 7.5/10

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Coalition
C0014

The Claim

“Paid $300 million to landfill operators for carbon credits (ACCUs) to incentivise them to burn methane which they would have burnt anyway. This is in addition to them already being paid green certificates (LGCs) and wholesale electricity revenue, and includes sites which are legally required to burn that methane.”
Climate Environment Tax
Original Source: Matthew Davis
Analyzed: 29 Jan 2026

Original Sources Provided

✅ FACTUAL VERIFICATION

The $300 million figure appears to be accurate and is directly sourced from an authoritative academic assessment [1]. According to an extensive ANU Law School analysis by Professor Andrew Macintosh, non-additional abatement credited under landfill gas methods "equates to approximately 19.5 million ACCUs, or almost 20% of the total number of ACCUs issued under the ERF to the end of 2021. These credits are likely to have been worth more than $300 million" [1].

The claim's core factual elements are supported:

  1. Multiple revenue streams: Landfill gas generation projects DO receive revenue from three sources: (a) electricity sales, (b) Large-Scale Generation Certificates (LGCs) under the Renewable Energy Target scheme, and (c) Australian Carbon Credit Units (ACCUs) [1]. The claim is accurate on this point.

  2. Additionality issues: The Macintosh report found that approximately 2/3 of the abatement credited under landfill gas methods would have occurred anyway "because the activity is profitable without carbon credits" [1]. This directly supports the claim that operators would have "burnt methane anyway."

  3. Regulatory requirements: The claim that sites are "legally required to burn that methane" is partially accurate. Large landfills ARE regulated under state and territory environmental laws requiring them to "capture and destroy a proportion of the biogas released from the site to mitigate odour and safety risks" [1]. However, the baseline capture rates vary significantly between jurisdictions, and the largest 20 projects use reduced baselines (24% or even 0%) that create additionality problems [1].

  4. Government expenditure: The Emissions Reduction Fund (ERF) was authorized with $4.5 billion in government funding [1]. The $300 million allocation to non-additional landfill gas credits represents a significant portion of this budget that effectively purchased abatement that would have occurred regardless.

Missing Context

However, the claim omits several important contextual factors:

  1. Origin of the scheme structure: The ERF's landfill gas methods are based on Labor's Carbon Farming Initiative (CFI), which was the foundation for carbon credit methodology when Labor governed (2007-2013) [1]. The scheme's basic structure—using carbon credits for landfill gas projects—originated under Labor, not Coalition. The Coalition inherited and expanded this approach rather than inventing it [1].

  2. Legitimate smaller projects: Not all landfill gas projects were non-additional. The Macintosh analysis specifically notes: "there are legitimate landfill gas projects that are likely to have generated, and continue to generate, real and additional abatement. Flaring-only projects, and many small-to-medium-sized generation projects, are likely to need additional incentives beyond the ability to sell electricity and LGCs to be viable" [1]. The problem was concentrated in the 20 largest projects, not the entire scheme.

  3. Why additionality problems exist: The integrity problems stem from the method's design flaw—it lacks measures to address "financial additionality" (the risk abatement occurs anyway because it's profitable) [1]. This is a methodological design issue that was not deliberately created but rather reflects a failure to anticipate market conditions where electricity + LGC prices would be high enough to make projects viable without ACCUs.

  4. Government recognition of concerns: The Emissions Reduction Assurance Committee (ERAC) itself recommended in 2018 that generation projects should NOT receive a crediting period extension, finding that "generation projects are likely to continue in the absence of the incentive provided by the ERF" [1]. The government's subsequent decision to grant a 5-year extension anyway appears to have involved circumventing ERAC's own integrity recommendation by creating a new method [1].

  5. Clean Energy Regulator's defense: The regulator rejected Macintosh's assertions, claiming independent analysis had "refuted" his findings and that the scheme had "well established and rigorous processes" [2]. However, the regulator did not release the detailed analysis supporting this rebuttal, undermining its credibility.

Source Credibility Assessment

Original sources provided with the claim:

  1. First source (AUKUS statement) appears to be incorrectly included and is not relevant to carbon credits or landfill methane—it discusses defense/security policy. This is a source attribution error.

  2. Second source (Guardian, 2022): This is a reputable mainstream news outlet reporting on legitimate academic research by Professor Andrew Macintosh. The Guardian is not an advocacy organization and presents Macintosh's claims alongside responses from the Clean Energy Regulator. This is appropriately balanced reporting [2].

The actual authoritative sources for this claim:

  • ANU Law School analysis (2022): Professor Andrew Macintosh's comprehensive peer-reviewed assessment is the primary source for the $300 million figure and the additionality analysis [1]. Macintosh is a credible environmental law expert who served for 6+ years as head of the government's own Emissions Reduction Assurance Committee before resigning to publish his critique [2].

  • The analysis is based on publicly available Clean Energy Regulator data and government emissions statistics, making it independently verifiable [1].

⚖️

Labor Comparison

Did Labor do something similar?

The Carbon Farming Initiative (CFI) was created by Labor and operated from 2012-2015 (under Gillard government's broader carbon pricing mechanism) [1]. Labor's carbon pricing scheme was designed to have broader regulatory mechanisms ensuring price-driven emission reductions, not voluntary offsets.

When Labor created the CFI, the landfill gas method component was included, but it operated within Labor's broader carbon pricing context. The current additionality problems emerged more acutely under the Coalition's successor scheme (ERF) for several reasons:

  1. The Coalition removed the carbon price mechanism that Labor had created, replacing it with the ERF as the primary climate policy [1]
  2. Electricity and LGC prices evolved differently than anticipated when the original methods were designed
  3. The Coalition granted a 5-year extension to generation projects despite ERAC recommending against it, a decision Labor did not face (the carbon pricing scheme was abolished before this extension question arose) [1]

Therefore, while Labor created the original CFI methodology that became the basis for ERF landfill gas methods, the specific problem of paying $300 million for non-additional credits is primarily a Coalition-era issue that emerged from:

  • The Coalition's replacement of carbon pricing with voluntary offsets (ERF)
  • Market price changes (electricity/LGC prices remained high)
  • The Coalition's decision to extend crediting periods despite ERAC advice against it
🌐

Balanced Perspective

The criticism is justified in several respects:

The Macintosh analysis and ERAC's own 2018 recommendation both provide compelling evidence that a significant portion of landfill gas ACCUs do not represent additional abatement [1]. The government continued issuing substantial credits despite internal advisory committee recommendations against it. This represents a failure of policy integrity.

The fact that landfill gas emissions remained essentially flat while 3.3 million ACCUs per year were issued is difficult to reconcile with the claim that these credits represent real emission reductions [1]. If the credits were genuine, emissions should have declined significantly—but they didn't.

However, several counterpoints apply:

  1. Not intentionally fraudulent: There's no evidence the scheme was designed to knowingly award false credits. Rather, it reflects a methodological design flaw (lack of financial additionality measures) combined with unanticipated market conditions where electricity and LGC prices remained strong enough to make projects viable anyway [1].

  2. Legitimate projects do exist: Smaller flaring-only projects and some medium-sized generation projects likely do need the additional revenue from ACCUs to be viable [1]. Eliminating the entire scheme would hurt these genuinely additional projects.

  3. Government advisory body questioned policy, not method integrity: ERAC's 2018 recommendation against extension wasn't a complete condemnation of the method—it was a finding that market conditions had changed such that these projects no longer needed ACCUs [1]. The method itself wasn't necessarily "broken," but policy should have acknowledged changed circumstances.

  4. Governance structure is flawed: Macintosh argues the real problem is structural—the Clean Energy Regulator has conflicting roles (designing methods, regulating compliance, and purchasing credits), creating weak incentives to acknowledge additionality problems [1][2]. This is a governance issue, not necessarily a deliberate fraud.

Key context: This is in addition to them already being paid green certificates (LGCs) and wholesale electricity revenue—this aspect of the claim is accurate and important. Large landfill projects had three revenue streams, and the additionality analysis shows that the first two (electricity + LGCs) were often sufficient to make projects profitable [1].

And includes sites which are legally required to burn that methane—partially accurate but misleading in implication. While large landfills ARE regulated to manage biogas, the baselines used in the method (24% or 0% for large projects) are well below what regulatory requirements actually mandate, creating a structural loophole [1].

TRUE

7.5

out of 10

with important caveats about scope and context

The $300 million figure is accurate and well-sourced. The core claim that landfill operators received significant payments for burning methane they would have burned anyway is supported by credible independent analysis. The fact that these operators had multiple revenue streams (electricity, LGCs, ACCUs) is accurate.

However:

  • The first source provided appears to be an error (AUKUS statement is irrelevant)
  • The characterization is narrower than suggested—approximately 2/3 of the 20 largest projects show additionality problems, not necessarily all landfill projects
  • The scheme structure originated under Labor, though the specific scale and extension decisions were Coalition-era choices
  • The problem is primarily one of methodological design flaw + market change, rather than intentional fraud (though governance failures enabled continued over-crediting despite internal warnings)

The claim is factually accurate but somewhat oversimplified in its presentation, as it doesn't distinguish between genuinely additional smaller projects and the problematic large generation projects.

📚 SOURCES & CITATIONS (5)

  1. 1
    PDF

    erf landfill gas method an assessment of its integrity 16 march 2022

    Law Anu Edu • PDF Document
    Original link unavailable — view archived version
  2. 2
    theguardian.com

    theguardian.com

    Prof Andrew Macintosh says the system, which gives credits for projects such as regrowing native forests after clearing, is ‘a fraud’ on taxpayers and consumers

    the Guardian
  3. 3
    legislation.gov.au

    legislation.gov.au

    Specification of Regional Area 2015

  4. 4
    cer.gov.au

    cer.gov.au

    Cer Gov

  5. 5
    cer.gov.au

    cer.gov.au

    Cer Gov

Rating Scale Methodology

1-3: FALSE

Factually incorrect or malicious fabrication.

4-6: PARTIAL

Some truth but context is missing or skewed.

7-9: MOSTLY TRUE

Minor technicalities or phrasing issues.

10: ACCURATE

Perfectly verified and contextually fair.

Methodology: Ratings are determined through cross-referencing official government records, independent fact-checking organizations, and primary source documents.

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