Emissions Reduction Fund aggregation agreements
Aggregation under the Emissions Reduction Fund (ERF) is the process of bringing multiple sources of emissions together. An aggregated project is one that has multiple project sites, potentially owned by multiple people, and an aggregator is a person who brings together emissions reductions activities on multiple sites into a single project.
Participating in an aggregated project under the ERF is a significant business decision. This means that it is important to understand what is involved in an aggregated project and have this understanding documented in an 'aggregation agreement'.
What is an aggregation agreement?
An aggregation agreement is a legal document, detailing the rights and responsibilities of all parties participating in an aggregated project under the ERF.
An aggregation agreement is between the project proponent and the site owners who are contributing their land or assets to the project. It is a commercial contract between private parties, and is not a contract with the Government. Aggregation agreements are not required in order to participate in the ERF. The Government is not responsible for the terms of aggregation agreements, or their enforcement.
What are the benefits of having an aggregation agreement?
It is important to understand what is involved in an aggregated project and have this understanding documented in an aggregation agreement. This is one way to clarify responsibilities and manage risk.
The Department recommends that you obtain independent legal, financial, tax and technical advice with particular reference to your own requirements.
Participating in an aggregated project is an individual decision to be taken in the context of your own circumstances.
Aggregation agreement resources
Agreements may cover many different issues. The resources below outline some of the most important matters that aggregators and site owners should consider when developing their aggregation agreement.
This fact sheet is designed to help site owners and aggregators understand the benefits, risks and legal obligations involved in aggregated projects. You should read this before moving on to the other resources on this page.
This document is designed to be printed and provided to landholders. It is a shortened form of the aggregation agreement fact sheet.
The key issues to consider document provides more detailed information about the kinds of issues that may arise in negotiating an aggregation agreement. This document contains cross-references to example clauses in the case studies to further explain the issues.
These documents contain cross-references to questions in the key issues to consider document to further explain the issues.
Environmental plantings project
In this case study project, five farmers agree to let a company do a project on their land. The case study discusses issues that the farmer and company may wish to consider when setting up the contractual arrangements between them, and contains cross-references to questions in the key issues to consider document. It considers specific issues related to sequestration projects.
Industrial electricity and fuel efficiency project
In this case study, three site owners agree to let a company do a project at their facilities that involves service providers installing and upgrading equipment. The case study discusses issues that the facility site owners and aggregation company may wish to consider when setting up the contractual arrangements between them, and contains cross-references to questions in the key issues to consider document.