Operational control under NGER is the concept that ties each facility to one corporate group, and therefore to one controlling corporation’s report. It is assessed facility by facility.
Key points
- Operational control rests on authority over operating, health and safety, and environmental policies
- Where shared, the greatest authority over operating and environmental policies decides
- Control can be nominated under section 11B or declared under section 54
- The operational controller of a Safeguard facility is the responsible emitter
- A mid-year change of control means part-year reporting by each corporation
The test
A corporation has operational control of a facility if it has the authority to introduce and implement three types of policy for the facility:
- operating policies
- health and safety policies
- environmental policies
If more than one corporation has that authority, the corporation with the greatest authority over operating and environmental policies has operational control. The test is about authority over policies, which is why it needs careful application to joint ventures and contracted operations.
When control is shared or disputed
Where operational control is equally shared and one party will take on reporting, or where the parties cannot agree, a corporation can nominate operational control for the facility under section 11B of the NGER Act, or apply for a declaration of operational control under section 54. The Clean Energy Regulator asks corporations to contact it before doing either.
Safeguard facilities
The person with operational control of a Safeguard facility is known as the responsible emitter, and carries that facility’s Safeguard obligations. A responsible emitter that is not also a controlling corporation must register separately by 31 August following the year in which it was first covered by the Safeguard Mechanism.
When control changes during the year
If operational control passes to another corporation part way through a year, for example when a facility is sold, each corporation reports for the part of the year it had control. Part-year reporting does not apply where only the ownership of the controlling corporation or a group member changes and operational control of the facility stays the same.
Contractors
The activities of contractors and sub-contractors at a facility count toward the thresholds of the corporation with operational control of that facility. The Regulator’s contracts and leasing guideline covers these arrangements, and its operational control supplementary guideline works through harder cases.
References & sources
Primary regulatory documents and authoritative references underpinning this answer.
- Clean Energy Regulator: Operational control supplementary guidelinecer.gov.au
- Clean Energy Regulator: Assess your obligationscer.gov.au
- Clean Energy Regulator: Nomination of operational control form (CER-NGER-014)cer.gov.au
- Clean Energy Regulator: Acquisitions, disposals and mergers (change in controlling corporation)cer.gov.au
- Clean Energy Regulator: Contracts and leasing guidelinecer.gov.au