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OZONE PROTECTION AND SYNTHETIC GREENHOUSE GAS MANAGEMENT AMENDMENT REGULATIONS 2011 (NO. 1) (SLI NO 64 OF 2011)

EXPLANATORY STATEMENT

Select Legislative Instrument 2011 No. 64

Issued by authority of the Parliamentary Secretary for Sustainability and Urban Water

Subject- Ozone Protection and Synthetic Greenhouse Gas Management Act 1989

Ozone Protection and Synthetic Greenhouse Gas Management Amendment Regulations 2011 (No. 1)

Section 70 of the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 (the Act) provides in part that the Governor-General may make regulations, not inconsistent with the Act, prescribing matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act.

Section 45A of the Act provides that the regulations may make provision for the following:

(a)    regulating the sale or purchase, or any other acquisition or disposal, of scheduled substances;

(b)   regulating the storage, use or handling of scheduled substances;

(c)    labelling requirements for scheduled substances and for products that contain or use scheduled substances;

(d)   conferring functions on persons or bodies (including non government bodies) in relation to matters covered by paragraph (a), (b) or (c);

(e)    matters incidental to matters covered by paragraph (a), (b), (c) or (d).

Subsection 39(1) of the Act provides that the regulations may include provisions prohibiting or regulating the manufacture, import, export, distribution or use by persons to whom this Part applies, or by persons engaging in activities to which this Part applies, of products that contain scheduled substances or depend on such substances for their operation. Subsection 39(2) further states the provisions that may be made by the regulations include, but are not limited to, provisions:

(a)    prohibiting the manufacture, import, export, distribution or use of particular kinds of products;

(b)   prohibiting the manufacture, import, export, distribution or use of particular kinds of products except in accordance with prescribed requirements;

(c)    prohibiting the manufacture or import of products by a person who has not

complied with a code of practice relating to the recovery, recycling or disposal of scheduled substances used in products manufactured or imported by that person; or 

(d)   prohibiting the distribution by a corporation of products that are not labelled or marked in accordance with the regulations.

The Act provides measures to meet Australia's obligations under the Vienna Convention for the Protection of the Ozone Layer, the Montreal Protocol on Substances that Deplete the Ozone Layer and the United Nations Framework Convention on Climate Change. In particular, the Act provides measures to protect the ozone layer from ozone depleting substances and to minimise emissions of synthetic greenhouse gases. Under the Act, ozone depleting substances and synthetic greenhouse gases such as hydrochlorofluorocarbons (HCFCs) are listed as scheduled substances.

The Ozone Protection and Synthetic Greenhouse Gas Management Regulations 1995 (the Principal Regulations) currently control the acquisition, manufacture, use, storage and disposal of ozone depleting substances and synthetic greenhouse gases.

The proposed regulations make amendments to the Principal Regulations related to recent changes made to the Act by the Ozone Protection and Synthetic Greenhouse Gas Management Amendment Act 2010 (the Amendment Act).

In November 2010, the Amendment Act was passed by Parliament. Those amendments, inter alia, extended the prohibition on the import or manufacture of refrigeration and air conditioning equipment to equipment containing or designed to operate using a HCFC refrigerant or insulated with an HCFC foam (clause 10 of Schedule 4 to the Act). In addition, subclause 10(1A) of Schedule 4 provides that the regulations may specifically exempt certain refrigeration and air conditioning equipment from the import and manufacture ban imposed by subclause 10(1) of Schedule 4.

Those amendments strengthened the existing ban on the import and manufacture of air conditioning systems containing HCFC refrigerants that was imposed on 1 July 2010 as a condition of the Pre-Charged Equipment Licence under the Act and the Refrigerant Trading Authorisation and Refrigeration Equipment Manufacturing Authorisation under the Regulations. Air conditioning equipment represents more than 70 per cent of HCFC use in Australia. The 2010 ban was imposed after consultation with relevant licence holders and industry associations. However, as a result of consultation with stakeholders, certain equipment types were exempted as non HCFC dependent alternatives were not viable in the Australian market for those applications.

As a result of the Amendment Act, amendments to the Principal Regulations are necessary to continue to exempt certain refrigeration and air conditioning equipment where non HCFC dependent alternatives are not viable in the Australian market.

Details of the proposed Regulations are set out in the Attachment.

The Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003. The Regulations will commence on the commencement of Schedule 2 to the Ozone Protection and Synthetic Greenhouse Gas Management Amendment Act 2010 (see item 2 - Commencement).

Authority: Sections 70, 45A and 39 of the Ozone Protection and

Synthetic Greenhouse Gas Management Act 1989

ATTACHMENT

|Details of the Ozone Protection and Synthetic Greenhouse Gas Management Amendment Regulations 2011 (No. 1)

Regulation 1 - Name of Regulations

This regulation provides that the title of the Regulations is the Ozone Protection and Synthetic Greenhouse Gas Management Amendment Regulations 2011 (No. 1).

Regulation 2 - Commencement

This regulation provides for the Regulations to commence on the commencement of Schedule 2 to the Ozone Protection and Synthetic Greenhouse Gas Management Amendment Act 2010.

Regulation 3 - Amendment of the Ozone Protection and Synthetic Greenhouse Gas Management Regulations 1995

This regulation provides that the Ozone Protection and Synthetic Greenhouse Gas Management Regulations 1995 are amended as set out in the Schedule.

Schedule 1 - Amendments

Item 1 - Part 5, note 2

This item makes a consequential change to note 2 at Part 5 of the Principal Regulations as a result of amendments made by item 2 below.

Item 2 - Part 5, before regulation 80

This item inserts a new subregulation 70(2) in the Principal Regulations to exempt the following equipment from the ban on the importation of equipment which is pre-charged with HCFC (under subclause 10(1) of Schedule 4):

(a)    HCFC pre-charged refrigeration equipment;

(b)   HCFC pre-charged air conditioning equipment imported by pre-charged equipment licence holders that have been granted a partial fee waiver for one-off low volume imports;

(c)    chillers charged with HCFC-123; 

(d)   replacement parts for existing HCFC air conditioning equipment;

(e)    components for existing high static ducted split system air conditioners;

(f)    equipment insulated with foam manufactured with HCFC; and

(g)   equipment for which the Minister considers it is impracticable:

(i)     for the importer or licence holder for the equipment to comply with the ban; and

(ii)   to remove or retrofit the equipment because it is incidental to the main import.

The types of equipment or components specified in new subregulation 70(2) are exempted from the prohibition as they relate to either a low volume import consignment where the volume of HCFC is negligible, where environmental considerations particularly of energy efficiency and global warming potential make it undesirable to move to non HCFC alternatives or allow equipment maintenance requirements to be met and to avoid unreasonable time and financial costs being incurred.

These amendments will enable the ongoing staged phase-out of HCFC using equipment in Australia to complement the staged phase-out of the import of bulk HCFCs that is needed to service this equipment while also allowing time for the availability and viability of such non HCFC technologies. It will allow considered consultation with affected industry to take place, and give these industries sufficient time to transition to viable and affordable alternatives.

New regulation 70 applies until the end of 30 June 2015 (proposed subregulation 70(1)).

New subregulations 70(3) and (4) provide that the Minister can delegate his powers under this regulation 70 to an SES employee or acting SES employee in the Department, however in exercising a power under a delegation, the delegate must comply with any directions of the Minister.

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