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Jargon Buster

Confused by environmental and carbon jargon? Here's the Footprint guide to some key terms and what they mean in the Australian context.
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AAUs (Assigned Amount Units) – Units assigned at the national level in accordance with a country's Kyoto target. Each AAU is equal to one tonne of CO2e.

Abatement – Reducing the level of greenhouse gas emissions.

ACCUs - Australian Carbon Credit Units issued by the Clean Energy Regulator for abatement achieved through authorised projects.

Adaptation – Preparing for the effects of climate change.

Additionality - used to refer to abatement that is additional to what would have occurred under business-as-usual circumstances.

Afforestation – planting of new forests on lands not recently forested. This is a form of land use change that increases the amount of carbon removed from the atmosphere.

Aquifer - An underground geological formation or group of formations that contains groundwater.

ARENA - The Australian Renewable Energy Agency, which supports the early-stage development of renewables.

Australian National Registry of Emissions Units (ANREU) - ANREU is the electronic registry, established by the Australian Government, which tracks the ownership of various types of carbon units.


Base Year - targets for reducing greenhouse gas emissions are often defined in relation to a base year. For example, Australia undertook at Kyoto to limit its average annual emissions over 2008-2012 to 8% above 1990 levels.

Baseline and credit - A type of trading scheme in which participants gain a benefit if they keep emissions below a baseline level and must take action or incur a penalty if they rise above it.

Bioaccumulation - The increase in concentration of a chemical in organisms that reside in contaminated environments. Also used to describe the progressive increase in the amount of a chemical in an organism that results from rates of absorption in excess of its metabolism and excretion.

Biochemical Oxygen Demand (BOD) - The amount of dissolved oxygen, in milligrams per litre, necessary for the decomposition of organic matter by micro-organisms, such as bacteria. Measurement of BOD is used to determine the level of organic pollution of a stream or lake. The greater the BOD, the greater the degree of water pollution.

Biofuels – Fuels originating from plant matter. Biodiesel can also be made from animal tallow.

Biogas - Gas, rich in methane, which is produced by the fermentation of animal dung, human sewage or crop residues.

Biomass - Organic material, both above ground and below ground, and both living and dead, such as trees, crops, grasses, tree litter and roots.


Cap and trade – a type of emissions trading scheme in which a limit is placed on the total emissions allowable from activities or sectors covered by the scheme. This limit is set below what it would be under 'business as usual'.

Emitters covered by the scheme are then allocated permits (either in an auction or through a free allocation), with each permit representing the right to emit one tonne of CO2e. These permits can be bought and sold.

Carbon capture and storage (CCS) – the capture, transport and geological storage of CO2 and/or other greenhouse gases.

Carbon Farming Initiative - Originally, the CFI allowed farmers and land managers to earn carbon credits by storing carbon or reducing greenhouse gas emissions from land-based projects and waste management projects. Under Direct Action, the CFI has been expanded to allow carbon credits to be created from a much larger range of projects.

Projects approved by the Clean Energy Regulator to earn credits can then apply to participate in Emissions Reduction Fund auctions.

Carbon intensity – CO2e emissions per unit of economic output (e.g., tonnes of CO2e per dollar of GDP)

Carbon neutral – taking action such as energy efficiency, sourcing renewable energy and offsetting residual GHG emissions so that net greenhouse impact is zero.

Carbon sequestration – The removal of atmospheric CO2 through processes such as photosynthesis by plants and trees or absorption by oceans. Carbon capture and storage (CCS) is another form of sequestration.

Carbon price path – a forecast or estimate of where the future price of carbon permits will be at different times.

Carbon sinks – Systems that absorb and store CO2, including vegetation and the oceans.

Catchment - The area in which water (from rainfall or other sources) collects, to form the supply of a river, stream or drainage area.

Certified Emission Reductions (CERs) – tradeable credits created by Clean Development Mechanism projects. Each CER represents a reduction of one tonne of CO2e.

Chlorofluorocarbons (CFCs) – these are greenhouse gases that are being phased out under the Montreal Protocol because they also destroy the ozone layer. They are being replaced with hydrochlorofluorocarbons and hydrofluorocarbons (HFCs), which are far less damaging to the ozone layer. HFCs are one of the greenhouse gases covered by the Kyoto Protocol.

Clean Development Mechanism (CDM) – The CDM aims to promote sustainable development in developing countries and to help developed countries meet their Kyoto Protocol emissions reduction targets. Investors in CDM emissions reduction projects earn tradeable Certified Emission Reductions (CERs) from them. Projects must be approved by the CDM Executive Board. The CDM was established by Article 12 of the Kyoto Protocol.

Clean Energy Finance Corporation - The Clean Energy Finance Corporation has a $10 billion budget to help overcome capital market barriers hindering the commercialisation and deployment of clean energy and energy efficiency technologies. Its support does not take the form of grants.

Clean Energy Regulator - The Clean Energy Regulator is an independent statutory authority responsible for administering the Emissions Reduction Fund, the Renewable Energy Target, the Carbon Farming Initiative and the National Greenhouse and Energy Reporting Scheme.

Climate Change Authority - an independent statutory authority undertaking reviews and making recommendations on Australia's progress in reducing emissions and on suitable emissions reductions targets.

Cogeneration – production of heat and power from the same process – also known (for obvious reasons) as combined heat and power (CHP). Because cogeneration systems make use of heat that is wasted in conventional generation systems they are much more efficient.

CO2e (Carbon dioxide equivalent) – to account for the differences in the warming effect of various greenhouse gases, emitters often express their emissions of various gases in CO2 equivalent (CO2e) terms. This represents the amount of CO2 that would have the same relative warming effect as the basket of greenhouse gases actually emitted.

Commercial Building Disclosure - a federal scheme that requires most large office buildings and some other commercial buildings to obtain and disclose a Building Energy Efficiency Certificate.


Direct Action
- The umbrella term for the Government's policy to reduce emissions. Key elements of the policy are the Emissions Reduction Fund and the Safeguard Mechanism.

Direct emissions (also known as Scope 1 emissions) – greenhouse gas emissions from sources that are owned or controlled by your organisation (e.g. emissions resulting from on-site combustion of fossil fuels; PFC emissions from aluminium smelting). In contrast, indirect emissions result from your organisation’s activities but are not generated by sources that your organisation controls. Your organisation's indirect emissions include power station emissions associated with the electricity you buy.


Eco-labellingA method of certifying the environmental quality of a product.

Ecological footpring - The area of productive land and aquatic ecosystems required to produce the resources used and to assimilate the wastes produced by a defined population at a specified material standard of living.

Ecologically sustainable development - involves decision-making processes that integrate long-term and short-term economic, environmental, social and equity considerations.

Ecologically sustainable development incorporates the principle of intergenerational equity - that the present generation should ensure that the health, diversity and productivity of the environment is maintained or enhanced for the benefit of future generations.

Ecology - The relationship between living things and their environments.

Ecosystem - A dynamic complex of plant, animal and micro-organism communities and their non-living environment, interacting as a functional unit.

Ecosystem resilience - The level of disturbance that an ecosystem can undergo without crossing a threshold into a different structure.

Ecosystem services - The benefits people obtain from ecosystems.

Effluent - Liquid waste (treated or untreated) discharged to the environment from sources such as industrial facilities and sewage treatment plants.

Emissions Reduction Fund - The ERF funds carbon abatement and sequestration projects selected through a reverse auction process or by other means. It is part of the Government's Direct Action policy.

Emission Reduction Units – a type of international carbon unit created by Joint Implementation projects, as defined in the Kyoto Protocol.

Environmental impact assessment - A systematic examination of the possible environmental consequences of an activity or project.

EU emissions trading scheme (EU ETS) – the scheme was launched on January 1, 2005, with an initial phase from 2005-07 to be followed by a second phase (2008-2012). Installations covered by the EU ETS include electricity generators, iron and steel manufacturers, cement manufacturers and pulp & paper processors. Facilities in these sectors must surrender EU Allowances (EUA) corresponding to their emissions during the year.

Eutrophication - The degradation of water quality due to enrichment by nutrients, primarily nitrogen and phosphorus, which results in excessive algal growth and decay.

Externality - A cost not borne by those who create goods and services, such as the cost of the harm caused by the discharge of pollution into the environment.


Feed-in tariff – a higher electricity tariff paid by an electricity retailer to customers who have solar photovoltaic (PV) systems and who sell the excess electricity back to the grid.

Forward price curve – a forecast or estimate of what the future price of carbon permits will be at different points in the future.

Fuel switching – substituting lower carbon-content fuels for higher content fuels, for example switching from coal to gas.

Fugitive emissions – emissions associated with gas leaks from the mining, processing and transportation of fossil fuels. This includes methane given off during oil and gas drilling and coal mining and leakage from gas pipelines.

Futures – a derivative contract to buy or sell carbon permits at a certain date in the future for a certain price.


Garnaut Review – The initial Garnaut Climate Change Review was commissioned by Australia's State and Territory governments in April 2007 and its findings, released in September 2008, guided the Labor Government's decisions on abatement targets for Australia.

Greenhouse Gas Protocol – the GHG Protocol is the most widely used international accounting tool for quantifying greenhouse gas emissions. It was jointly developed by the World Business Council for Sustainable Development and the World Resources Institute.

Greenhouse gases (GHGs) – Gases in the earth's atmosphere that absorb and re-emit infrared radiation. The Kyoto Protocol lists six major greenhouse gases, which vary in their relative warming effect. The six gases are carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), HFCs (hydrofluorocarbons), perfluorocarbons (PFCs, which are significant in Australia because they are generated as a by-product of aluminium smelting) and sulphur hexafluoride (SF6).


Hot air – refers to carbon credits related to emission reductions that occurred without any deliberate action. Russia and Ukraine are widely seen as having the most 'hot air' to sell, because the post-1990 collapse of Soviet-era industry led to greatly reduced fossil fuel consumption. As a result, their emissions have fallen well below 1990 levels (the base year on which Kyoto targets were calculated). They can potentially trade this windfall surplus with other countries that have tougher, more realistic targets.

To deal with these concerns, some of these countries offer 'greened' AAUs that are linked to green investment schemes. Under these schemes, the proceeds of sales of AAUs are directed to accredited environmental projects.


Indirect emissions – emissions that are a consequence of the activities of an organisation, but occur from sources owned or controlled by another organisation. Your company's indirect emissions include the emissions associated with generating any electricity it buys.

Intensity targets – policies that specify emissions reductions relative to economic output, for instance tonnes of CO2e per million dollars of GDP.

IPCC – the Intergovernmental Panel on Climate Change is an international panel of scientists and researchers that provides advice on climate change to the international community. It is acknowledged by governments around the world, including the Australian Government, as the authoritative source of advice on climate change science. It was established by the World Meteorological Organisation and the United Nations Environment Program in 1988. The IPCC shared the 2007 Nobel Peace Prize with former US Vice-President Al Gore for its work to inform the world of the dangers of climate change.


Joint Implementation (JI) – The Kyoto Protocol’s Joint Implementation mechanism allows one developed country to earn credits in the form of Emission Reduction Units when it finances projects that reduce emissions in another developed country.


Kyoto Protocol – a treaty negotiated under the auspices of the UN Framework Convention on Climate Change. The protocol, which sets binding abatement targets for developed countries over 2008 to 2012, entered into force in 2005.


Landfill gas – gas generated by the decomposition of waste in landfills.

Life-cycle analysis - A management tool for identifying the net flows of resource and energy used in the production, consumption and disposal of a product or service.

LULUCF – a Kyoto acronym that stands for human-induced ‘Land Use, Land-Use Change and Forestry’. Some of these activities result in greenhouse emissions and some lead to greenhouse gases being removed from the atmosphere. For example, land clearing generates greenhouse gas emissions. Planting trees can lead to greenhouse gases being absorbed from the atmosphere. According to the US-based Pew Centre on Climate Change, about one-fifth of global emissions result from LULUCF activities.


MRET – the federal Mandatory Renewable Energy Target scheme was established in 2001 to encourage the generation of an additional 9,500 GWh of renewable energy per year by 2010. However, sufficient capacity to meet this initial target was installed far earlier than expected.

MRET was superseded by the Renewable Energy Target (RET) scheme, which – following 2015 amendments that weakened the target – aims to generate 33,000GWh from renewables by 2020.


National Carbon Offset Standard – The National Carbon Offset Standard specifies what companies and other organisations must demonstrate if they want their carbon neutrality claims officially endorsed.

NCOS also details various types of carbon offsets that can be used to help achieve a carbon neutral status. Low Carbon Australia uses NCOS to certify businesses, products and events as carbon neutral.

National Greenhouse Gas Inventory (NGGI) – the annual inventory of national greenhouse gas emissions produced by Australia as part of its commitments under the UN Framework Convention on Climate Change.

National Pollutant Inventory - Australia's reporting and public information system on emissions to air, land and water.

Natural capital - Natural assets in their role of providing inputs and environmental services for economic production. Natural capital includes land, minerals and fossil fuels, solar energy, water, living organisms, and the services provided by the interactions of all these elements.

NGER - the National Greenhouse and Energy Reporting scheme, which underpins the carbon price scheme. All large emitters and large energy users and producers must report through NGERS.

Non-point source pollution - A pollution source that lacks a single point of origin. Common activities that result in non-point source pollution are agriculture, forestry and transport.


Offsets – Environmental offsets are measures that compensate for the residual adverse impacts of an action on the environment.

Carbon offsets reduce emissions of greenhouse gas in order to compensate for or to offset an emission made elsewhere.


Permit – a certificate that enables an emitter under an emissions trading scheme to emit one tonne of CO2e.

Persistent organic pollutants (POPs) – toxic hemicals that remain intact in the environment for long periods, become widely distributed geographically and accumulate in the fatty tissue of living organisms.

PM10 - Small particles in the air with an aerodynamic diameter less than 10 micrometers. They are small enough to get into the lungs and can cause health problems. Sources of these particles include combustion, crushing or grinding operations, pollen, road dust and sea salt.

PM2.5 - Particles in the air smaller than 2.5 micrometers in diameter. General sources of these particles include all types of combustion, including motor vehicles, power plant emissions and fires. Fine particles pose the greatest risk to human health, as their size means they can be breathed deep into the lungs. These particles are up to 30 times smaller than the width of a single human hair.


RET – The Renewable Energy Target scheme aims to support the roll-out of renewable energy technology. Following amendments in 2015, it now has a target of generating 33,000GWh of electricity from renewables by 2020.

Reforestation – replanting of forests on lands that have recently been harvested.

Renewable energy – energy from sources that are inexhaustible, such as wind, solar, geothermal energy and biofuels.


Scope 1 emissions – emissions from sources that a company or organisation owns and controls. These can include emissions from: its combustion facilities (e.g. boilers, furnaces, burners, turbines); its vehicle fleet; and from its physical or chemical processes (e.g. PFC emissions generated as a by-product of aluminium smelting). The terminology comes from the international Greenhouse Gas Protocol, jointly developed by the World Business Council for Sustainable Development and the World Resources Institute. Scope 1 emissions are also called direct emissions.

Scope 2 emissions – your company's scope 2 emissions are the emissions that result from the generation of the electricity, heat or steam that you buy. These are a form of indirect emissions.

Scope 3 emissions – your company's scope 3 emissions are all indirect emissions other than those covered by scope 2. Examples include emissions associated with the extraction, manufacture and production of the materials your company buys, any business travel and employee commuting in vehicles not owned or controlled by the company and waste-related emissions.

Spot market – a market in which permits are sold and delivered immediately. Contracts bought and sold on these markets are immediately effective.

Stationary combustion – burning of fuels to generate electricity, steam or heat.

Sustainable consumption - The use of services and products to satisfy basic human needs and provide a good quality of life while minimising the use of natural resources and emissions of waste and pollutants.

Sustainable development - Development that meets the needs of people today without compromising the ability of future generations to meet their own needs.


Trade-exposed, emissions-intensive industries – industries that are either exporters or compete against imports and produce significant emissions.

Turbidity - The degree of cloudiness in water caused by the presence of suspended material.


UNFCCC – the United Nations Framework Convention on Climate Change. Australia is a signatory to the UNFCCC, which was adopted at the 1992 Earth Summit in Rio de Janeiro. The Kyoto Protocol was negotiated under the auspices of the framework convention.


Verification – the objective and independent assessment of whether a company's reported GHG inventory properly reflects its GHG impact, in conformance with GHG accounting and reporting standards.

VEET – the Victorian Energy Efficiency Target scheme. The scheme began in 2009 and has now been expanded to subsidise energy efficiency activities in businesses, as well as in households.

Voluntary market - the market servicing organisations and individuals buying carbon to voluntarily reduce or offset their emissions.

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