Equipment failure at Incitec Pivot’s chemical plant at Moranbah in Queensland led to a massive unplanned release of nitrous oxide, a global warming gas 300 times more potent than carbon dioxide, an investigation by the Australian Conservation Foundation has found.

The massive release of nitrous oxide (N2O) at Moranbah resulted in a 10 per cent increase in annual climate pollution from Incitec Pivot, which produces fertilisers and explosives.

Despite being covered by the Morrison Government’s climate safeguard mechanism, Incitec Pivot exceeded the agreed emissions baseline from its Moranbah plant in 2018-19 by at least 198,279 tonnes and was not compelled to buy any carbon credits to make up for the blowout.

“Make no mistake, this massive release of super-potent nitrous oxide from Incitec Pivot’s chemical plant at Moranbah is making our climate change problem worse,” said ACF climate change program manager Gavan McFadzean.

“This pollution is entering the atmosphere, making heatwaves longer, bushfires more extreme and contributing to coral bleaching on the Great Barrier Reef.

“Based on prices from the last Emissions Reduction Fund auction, Incitec Pivot’s pollution blowout should have cost it $2.8 million in carbon credits, but instead the company was able to simply recalculate its baseline and enter a multi-year monitoring period.

“Multi-year monitoring is a problem because companies that exceed their emissions limits in one year don’t have to buy carbon offset credits to compensate and in many cases they are allowed to re-calculate their baselines and pollute more.

“When a big polluter like Incitec Pivot is waived around $2.8 million in carbon credits, Australian taxpayers pick up the tab and we all pay for it through increased climate damage.

“This is just the latest of a long line of flaws and failings of the Government’s signature policy to tackle climate change.”

The Morrison Government’s safeguard mechanism, part of Australia’s emissions reporting framework, applies to mines, smelters, refineries and other facilities that have direct emissions of more than 100,000 tonnes of climate pollution per year.

If a company exceeds its limit, it is supposed to buy carbon credits. However, design flaws in the legislation allow companies to avoid buying credits or reducing their emissions.

Since the start of 2019, ACF investigations have revealed:

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