Annual Large-scale Renewable Energy Target surrender

RET Liable entities must surrender LGCs in the REC Registry annually for the given compliance year.  Once LGCs are accepted by the Clean Energy Regulator the LGCs are permanently removed from the LGC Market.

• For surrender periods see Timelines.
• For determining the number of LGCs  that need to be surrendered see Determining Liability

RET Liable entities annually can surrender:

• LGC Market LGCs - When the LGCs are purchased from sellers via the LGC market they must be created by 31 December of the previous year to acquit the current year liabilities.
• If a RET liable entity surrenders additional LGCs to acquit their LGC liability for the relevant year they will have a carried forward surplus for the next year.

RET Liable entities are required to pay an 8 cent surrender fee.

• When the surrender offer is accepted by the Clean Energy Regulator a LGC surrender fee is generated by the REC Registry as a fee item.
• At the time of LGC acceptance, emails are sent to the account administrator and appropriate account user indicating that a payment for the fee item be made within 28 days of the email notice.
• The surrender process is not finalised unit the LGC surrender fee is paid.

RET Liable entities have a LGC shortfall when the number of LGCs surrendered is less than the LGC liability for the current year.  To avoid payment of the Large-scale Generation Shortfall Charge (LGSC), RET liable entities must choose to purchase/register LGCs prior to the surrender deadlines. The Clean Energy Regulator recommends that LGCs are purchased at least two weeks prior to the surrender deadline to allow for processing.

If RET liable entities have a LGC shortfall* greater than 10% of their LGC liability they are required to pay the LGSC.  The LGSC is:

• paid annually with the Annual Energy Acquisitions Statement/Large-scale Generation Shortfall Statement (AEAS/LGSS) and must be lodged with the Regulator by 14 February for the give compliance year.  If you fail to pay the LGSC with the AEAS/LGSS, interest charge can be applied.  For more information about interest charge view section 70 of the Act.
• $65 per LGC not surrendered for the 2010 and future compliance years.  $40 per LGC not surrendered for the 2001 – 2009 compliance years.
• Is redeemable.  RET liable entities can redeem the LGSC minus an administrative fee, as stipulated under regulation 28 (5) of the Renewable Energy (Electricity) Regulations 2001 (the regulations), within 3 years of the LGSC providing the RET liable entities are able to meet their current year LGC liability, as stipulated under section 95 – 98 of the Act.
• defined by the Renewable Energy (Electricity) (Large-scale Generation Shortfall Charge) Act 2010 (LCharge Act)

* Note if RET liable entities are 1 or more LGCs short the Regulator under section 134 of the Act may publish a list of RET liable entities that do not discharge their liability through LGC surrender.