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Australian Government
Department of Industry
ETHANOL PRODUCTION GRANTS PROGRAMME
Programme administrative guidelines
I, the Hon Ian Macfarlane MP, Minister for Industry, issue the following guidelines rcJating to the Ethanol Production Grants (EPG) programme for use by the Department of Industry.
Minister for Industry
Date12th June 2012
PART ONE - PROGRAMME OVERVIEW
1 Background
I .I In the 2014-15 federal Budget the Government announced that the Ethanol Production Grants would cease on 30 June 2015.
l .2 The Department of I ndustry (department) is responsible for administeri ng the programme.
2 Programme objective
2.J The objective of the programme is to support production and deployrnent of ethanol as a sustainable alk.mativc transport fuel in Australia.
2.2 The programme will provide fuel excise reimbursement at the legislated rate (under the Excise Tariff Act 1921) until 30 June 2015, for ethanol produced and supplied for transport use in Australia from locall y derived feedstock. No reimbursements will be provided after this date.
3 Programme outcome
3.1 The intended outcome of the programme is to:
- encourage the use of environmentally sustainable fuel ethanol as an alternative transport fuel in Australia
- increase the capacity of the ethanol i ndustry to supply the transport thcl market
- improve the long tenn viability of the ethanol industry in Australia
4 Programme administrative guidelines
4. l This document is the Ethanol Prod uction Grants programme administrative guidelines (guidelines). The objective of these guideli nes is to provide a framework for the operation of the programme.
4.2 These guidelines are supported by the initial enquiry tbnn, application fonn and fimding
agreement.
4.3 These guidelines commence when they are published by the department and expire on 30 June 2015, unless superseded by a revised edition.
4.4 The Australian Government has absolute discretion to amend or revoke these guidelines.
5 Conduct of programme
5. I The programme is a demand driven eligibility-based programme where applications can be submitted at any time during the operation of the programme. All applicants for funding under the programme must be approved by the depart men t.
.3
PART TWO - GOVERNANCE
6 MINISTER
6.1 The Minister is responsible for the programme.
7 Programme delegate
7.1 The Minister may delegate certain responsibilities for t he programme to an officer in the department (programme delegate).
7.2 The programme delegate will be responsible for decisions in relation to the granting of programme funds.
7.3 The programme delegate is to act in accordance with the APS Code o_( Conduct in section 13 of the Public: Service Act 1999. More panicularly, the programme delegate is to observe subsections 13(7) and ( I 0), provisions which require that:
a. the programme delegate must disclose, and take reasonable steps to avoid. any conflict of interest (real or apparent) in connection with APS employment, including his or her functions as programme delegate
- the programme delegate must not make improper use of:
i. Inside infonnation
ii. his or her duties, status, power or authority in order to gain, or seek to gain, a benefit or advantage for himscl f or herself or for any other person.
8 Department
8.1 The department has policy and administration responsibility for the programme, including:
- issuing documentation in relation to the administration of the programme
- providing programme advice to the Minister
- administering the programme to ensure policy objectives for the pro1:r, rammc arc met
- providing a point of contact for the programme 's stakeholders, including re ponding to requests for infom1alion on the delivery of the programme
- preparing, publishing and maintaining of proh'famme infonnation and related documentation
- undertaking eligibility assessments and due diligence of programme applications
- negotiating and entering into fonding agreements
- monitoring programme expenditure and compliance by grantees in relation to contractual obligations
- implementing any variations to funding agreements as required
- mai ntai ning data for reporti ng and evaluation requ irements
- assessing. approving and paying EPG claims on a regular basis
- receiving, assessing and reconciling quarterly EPG payment and excise payment records and reports from granteed
- undertaking progn1mme compliance audit of grantees as required
- commissioning and managing evaluations of the appropriateness, efficiency and effectiveness of the programme in meeting its objective as required
- initiating action in response to breaches of funding agreements
- issuing repayment notices and pursuing repayment of programme funds
- any other actions required to develop and implement the policy underlying the programme, or for the administration of the programme
8.2 The programme funds arc appropriated to the department. The department must administer the programme in accordance with the Australian Government's financial management and accountability framework including the Commonwealth grant guidelines.
8.3 The department will have regard to the pro1',Tamme objective and outcome when pcrfonning any function or making any decision i n relation to the programme.
9 Documentation
9.1 The administrative framework for the programme is derived from:
- these guidel ines;
- delegations from the Minister and the Secretary of the department;
- the application form; and
- the initial enquiry form;
- the funding agreement.
PART THREE -APPLlCATION AND ASSESSMENT PROCESS
l O Application process
l 0.1 Applications for the programme can be submitted at any time during the operation of the programme. Producers who believe they may be cligib]c should complete: an initial enc1uiry fonn which is available on the departmcnl's website at: ww, .industrv. gov.au.
l 0.2 Potential appJicants may consult the department in regard to their project eligibility or clari fy any other aspect of the programme at any ti me.
I 0.3 There i s no limit to the size of a grant under the programme, subject to the availability of funding.
1 1 Process for determining eligibility
11.l Upon receiving an initial enquiry. the programme manager will undertake a preliminary assessment of the initial enquiry.
11.2 .2 lf thc prn&rramme manager detennincs that a producer may be eligible i n accordance with the eligibility criteria in clause 1 2, the applicant will be asked to submit a fonnal application.
11.3 3Upon receiving a fom1al application, the programme manager will assess it to dctenninc its cHgibiJity against the eligibility criteria scl out in clause 12.
11 .4If the programme manager dctcnnines that the application is eligible, the application will be referred to the programme delegate for consideration nnd approval.
11.5The programme manager and the programme delegate may seek further infonnation from the applicant in the context of considering the application for approval.
12 Eligibility criteria
12.1 To be an eligible applicant under the programme, an applicant must :
be an Australian entity incorporated under the Co17Joratio11s Act 2001 (Cth); b. produce and supply eligible ethanol as transport fuel for use in Australia; and
not be named as an entity that has not complied with the Equal Opportunity Women in the Workplace Act 1999 (Cth)
12.2 Eligible ethanol means ethanol that:
- is produced by the applicant in Australia from locally derived feedstock being either:
i) biomass focdstock (including biomass waste and residues); or
ii) urban waste;
- is classified to be sub-items 10.7. 10.11. 10.20 or 10.30 of the schedule to the Excise
- has been entered for home consumption under section 58 or section 61C of the Excise
- for which the excise payable has been paid; and Tarif {Act 1921 Act 1901;
- docs not include any ethanol that has been imported into Australia and then converted to fuel ethanol.
13 Third party grant payment arrangements
13.1 The !:',Tantce may request that the Australian Government make the pa)'ments under the Ethanol Production Grants programme to a third party nominated by the grantee.
13.2 The programme delegate may, at the programme delegate's absolute discretion, either accept the nomination made under 13.1 and make payments to the third party, or continue to make payments to the grantee.
13.3 Where payment is made to a third party, the grantee remains responsible for ensuring all reporting and accountability requirements are met.
14 Grant appro,·al and notification
14.l The progranunc delegate will consider the programme manager's recommendations in relation to an applicant's eligibility and other relevant infomrntion, such as the achievement of the programme outcome, value for money and matters relevant to the approval of the expenditure of public monis.
14.2All applicants will be advised in writing of the outcome of their application within 30 days of the completion of the assessment process.
15 Negotiations and announcement
15.l Successful applicants will have 60 days (negotiation period) from the date the grant offer is made to execute a funding agreement with the Autralian Government. Fail ure to execute a funding agreement in this time may result in the withdra,val of the grant offer.
l 5.2 Any request for an extension of the negotiation period (for example any unexpected delay i n commencing production of ethanol) must be made to the programme manager and will be !T, fanted at the discretion of the pro1:',Tammc delegate.
l 5.3 Following execution of the funding agreement, the details of each grant decision, except payment details, will he published on the department's website, in accordance with the Com111011mmltlz grnnt guidelines. Grant payment details will be published within three months of the end of each financial year.
PART FOUR GRANT ADMINISTRATION
16 Funding agreement
16.J A successful applicant must enter into a funding agreement with the department before program me funds wi ll be paid to the grantee.
16.2 The fonding agreement will provide the legal framework for the mak i ng of ,grant payments, and will:
- not be inconsistent with the law of the Australian Government, a state or territory, or these guidelines
- specify the rate al which the grant will be paid for the eligible ethanol. and the timing and method of delivery of the grant paymenL-.
- specify that grant payments will be conditional upon meet ing the agreed requirements
- require the, antee to provide lo the department proof of payment of excise on the eligible ethanol together with the regular grant claims
- req uire the grantee to provide the department with quarterly reports of type. source and quantity of feedstock used in the production of eligible ethanol, quantity of eli!:r,ihle ethanol produced and supplied, excise payment and an original tatcmcnt from the Australian Tax Office confinni ng the excise payment for that quarter
- require the grantee lo keep records relating to the procurement of feedstock. production and sale of ethanol and pay1nent of excise on eligible ethanol lo the Australian Tax Office
- require the grantee to facilitate and cooperate with any independent evaluation of the programme undertaken by the department
- provide for inspection by or for the department of any premises where ethanol is produced and records arc kept
- provide for variation and tcnuination of the funding agreement
- provide for recovery of grant payments in certain circumstances
- require the grantee to comply with all applicable Autralian Government, state and
- require claim estimates (based on supply contracts in place plus up to 10 per cent) to territory laws be provided to the department on a quarterly basis m. also include other matters
I 7 Variations to the funding agreement
17.I A request to vary a funding agreement, whether during t he negotiation period or after a funding agreement has been executed, must be submitted in writing by the successful applicant or grantee to t he programme manager. The decision to grant t he variation will be ma<lc at the discretion of the programme delegate.
17.2 The department may also seek input from probity, technical or due diligence experts as required to assess the full i mpact of the variation request.
17.3 In undertaking an assessment of a request to vary a funding agreement. the programme delegate will assess:
- Whether the proposed variation would still meet the programme's eligibiliy requirements;
- the extent to which the varied project \vould still meet the criteria; and
- whether the variation would:
- significantly change the outcome of the project
- be consistent with the prn!,'l"amme objective
- be acceptable from a probi ty perspective
- impact upon the project's ability to satisfy agreed perfonnancc milestones
- be appropriate in all the circumstances
17.4 The department may seek to vary the funding agreement to incorporate any future changes to the programme objecti ves, guidelines and other administrati ve arrangements.
PART FIVE - MISCELLANEOUS
18 Confidentiality
18.1 lnfonnation supplied by applicants and grantees as part of the initial enquiry. application negotiation an<l contract management process will be t reated as commercial-in-confidence hy the Austrnlian Government.
18.2 Australian Government agencies are subject to the legislative and administrative accountability and transparency requirements, including disclosures to the Parl iament and i ts committees. The department may disclose. or allow at any time the disclosure of, any infonnation contained in or relating to any grantee:
- to its advisers or employees solely i n order lo evaluate or otherwise assess grant issues, including variations
- to i ts internal management person nel for purposes related to grant issues, including variations
- to relevant minisk.-rs
- to its internal auditor
- to the Australian National Audit Office
- in response to a request by a House or a Committee of the Parliament of the Commonwealth
- within the relevant departments, or ,vith another agency, where this serves the Austrnlian Government's legitimate interests
- where the infonnation is authorised or req uired by law to be disclosed
- where t he infonnat ion is in the public domain othcnvisc than by the Australian Government's disclosure
19 Programme delegate to proYidc guidance to applicants
19.1 The Programme delegate may prepare add itional documentation to provide guidance to applicants and grantees in relation to the administration of the programme, provided that the documt.-ntation is consistent with these guidelines and any instrument of delegation in place. Where there is a percei ved or real inconsistency between these guidelines and any subordinate documcnlation, the details in these guidelines will prevail over the subordinate documents.
20 Eligible claim
20. l Grant funding wili be paid only in respect of eligibJe ethanol as described in clause 12.1.
20.2 Eligible ethanol produced only aflcr a funding agreement has been executed can be deemed to be an eligible claim.
21 Requests for and the treatment of information
2 I .t The programme delegate will have primary responsibility for responding to requests for information on all aspects of the delivery of the programme.
21.2 The treatment, exchange and sharing of infonnation must recognise the confidentiality of that infonnation and must be in accordance wi th relevant legislat ive req uirements and agency-specific confidentiality policies. which include. but arc not limited to, the following:
- Primcy Act 1988 (Cth)
- Freedom <f JnflJrmaJion Act 1982 (Cth)
- Public service regulations
- Crimes Act 1914 (Cth)
c. Public Service Act 1999 (Cth)
Copyright Act / 968 (Cth)
- Auditor-General Act 1997 (Cth)
- Archives Act 1983 (Cth)
i. The common law.
2 l.3 Any infonuation must not be used or further disclosed except for the purpose for which that infonnation has been supplied or as otherwise requi rt.". tl or permitted by law, subject to the distribution of responsibilities in relation lo the programme. as provided for by these guidelines.
22 Taxation treatment of grant payments
22.1 Grants are subject to nom1al taxation treatment and no special arrangements will apply to a !:'T, ant under the programme. All potential applicants arc strongly advised to seek independent taxation advice on the tax implications of receiving a grant under the programme.
23 Contact details and feedback
23. l The department will respond to queries, concerns or feedback offered by an applicant in relation to the programme.
23.2 I f you have a question or complaint concerning the grant application nsscssmcnts or any other aspects of the programme, please contact:
EPG programme anager Transport Fuels Section Energy Security Branch Department of Industry Email:
23.3 lf you are not satisfied with a complaint resolution proced ure, you can contact the:
General Manager Energy Security Branch Department of Industry GPO Box 1564
CANBERRA ACT 2601
23.4 lf your complai nt is unresolved, you may wish to lodge a complaint with the Commonv.·ealth Ombudsman. There is no fee for making a complaint, and the Ombudsman will conduct an i ndependent investigation of the applicant's concerns. You should note that the Ombudsman prefers that you first raise your concern to t he relevant department before lodging a fonnal complaint.
23.5 The Commonwealth Ombudsman has offices in all states and territories. and can be contacted by telephoning 1300 362 072, or by writing to the relevant contact address specified on the Ombudsman's website at w ww.ombudsman. gov.au.
24 Interpretation
In these guidelines, unless the contrary intention applies:
Applicant means any eligible entity that has submitted a formal EPG application to the programme.
Application means the applicant's fonnal programme application submitted for assessment under the programme. i\ fonnal appl ication must be submitted in the format of the application fonn.
Application form means the Ethanol Production Grants prn!,rrammc application form, a document issued by the department through which an applicant formally applies for a grant under the programme.
Commonwealth means the Australian Government .as represented by the department.
Department means the Department of Industry.
Eligible claim means any claim which is acceptable under the progrnmmc, and for \vhich the applicant may claim payment under the EPG programme.
Eligi ble ethanol means any ethanol pro<luct.>d in accordance with the eligibility criteria in clause 12.
Funding agreement means the Ethanol Prod uction Grants programme fundi ng agreement between a grantee and the department for grant funding under the programme, as amended from ti me to time in accordance ·with the rules of the programme.
Grant means the amount to be paid for an eligible ethanol production project in return for the completion of specified conditions and req uirements. A grant is not to be confused with a gift or a loan.
Grant offer means the letter by the department confinning the approval of an applicant as an eligible ethanol prod ucer under the programme outlining the conditions under which t he grant is offered and the specific grantee and project details of the grant that has been approved. The grant offer has an expiry of 60 days, unless the negotiation period is extended by the programme delegate.
Grantee means an ent ity that was a successful applicant as a result of the assessment process and is entitled to receive a grant under the programme pursuant to a fonding agreement between the grantee and the department.
Guidelines mean the Ethanol Production Grants programme administrative guidelines.
Initial enquiry mcuns the submission of an initial enquiry fom1 in relation to the pmd uction and supply of eligible ethanol.
Locally derived fcedstocks means any eligible feedstock sourced from Auslrnlia for the prod uction of c]igiblc clhanoL
Minister means the Minister for Industry.
Ncgoliation period means the 60 day period from the date a grant offer is made fc>r the successful applicant and the department to execute a funding agreement.
Producer means any eligible ethanol producer based in Aust ralia that has submitted a EPG grant application to the department.
Programme means the Ethanol Production Grants programme.
Programme funds means the funding made available by the Australian Govcmmcnt for the programme in any given financial year, being the funding specified in the Portfolio Budget Statement (as varied by any Portfolio Additional Estimates Statement or by the :vtinistcr) for that year. There is no authority to enter into a funding agreement to provide a grant beyond the limit of available progra mme funds.
Programme delegate means the Australian Government officer with certain decision making responsibilities for the programme, as delegated by the Minister.
Programme manager means the main department contact person responsible for managing lhc delivery of the programme.
Urban waste means any homogenous or heterogeneous material; discarded, rejected, abandoned, unwanted or surplus matter (in solid, liquid or gaseous forms) from any process from which the matter was produced and the purpose it was produced for; or anything declared by regulation or by an environment protection policy to be a waste, whether of val ue or not. Specifically excluded arc the following:
- any waste categorised as 'prescribed' or 'scheduled ' by an environmental protection policy of Australian, state or territory governments
- any waste generated outside of Australia Ethanol Production Grids programme Programme administrative guidelines
- any \Vasic derived from the manufacture, production, refinement or ex.traction of fossil
- any source separated solid waste intended for sale or for recycling, reprocessing, folds recovery or purification by a separate operation.
Third party is any person or entity (other than the grantee) who receives a payment under the EPG at the direction of the grantee.