The Australian Competition and Consumer Commission today issued a draft determination proposing to allow Refrigerant Reclaim Australia to increase the industry levy on refrigerant gas imported and sold in Australia from $1.50 to $2.00.
RRA has had an authorisation* in place since 1994 for industry to agree to impose a levy to fund the collection and disposal of ozone depleting substances and synthetic greenhouse gases. The levy was initially set at $1.00 per kilogram on refrigerant gases sold by importers of those gases. The ACCC granted authorisation in 2006 for RRA to increase the levy to $1.50.
RRA notes the volume of refrigerants it is recovering continues to increase. RRA submits that an increase in the levy is required as a result of this increase to ensure the continued financial viability of the program. In conjunction with the levy increase that forms the basis of the application, RRA proposes to reduce rebates paid to contractors and wholesalers.
While the program is generally supported by industry and government some concerns have been raised regarding environment and efficiency benefits.
Based on the financial information provided by RRA, the ACCC considers that the increase in the levy will contribute to the long term financial viability of the program.
With the introduction of legislative requirements for industry participants to recover and safely dispose of refrigerant, RRA considers it is now possible to reduce the rebate paid to contractors and wholesalers without experiencing a negative impact on recovery. The ACCC considers that the rebates are justified and contribute to the ongoing success of RRA's scheme.
The ACCC considers that the on-going operation of the program facilitated by the increase in the levy to $2.00 will continue to result in both efficiency and environmental benefits.
The ACCC further considers that any increase in prices paid by consumers for goods which contain refrigerant gases would be minimal.
The ACCC notes the Australian Government's commitment to establishing an Australian Emissions Trading Scheme by 2010 is likely to impact on the refrigeration and air-conditioning industry and therefore the environment in which the RRA scheme operates. In these circumstances the ACCC considers authorising the program until 31 December 2010 would be appropriate.
The ACCC's draft determination will be available from the ACCC website, under Adjudication.
The ACCC is seeking submissions from interested parties in relation to its draft determination. Submissions can be made to: The General Manager, Adjudication Branch, Australian Competition and Consumer Commission, GPO Box 3131, Canberra, ACT, 2601. Submissions can also be lodged by fax on (02) 6243 1121 or by email to: adjudication@accc.gov.au.