Climate Active Certification: The Guide to Australia's Carbon Neutral Standard

Understanding Australia’s Climate Active Program

As Australia steps up climate ambition in line with the Paris Agreement, the Climate Active certification helps organisations transparently measure, reduce, offset - and credibly claim - carbon neutrality. Despite challenges and calls for reform, it remains the only Australian government-backed voluntary carbon neutral accreditation.

What is the Climate Active standard?

Climate Active is a voluntary certification framework, developed by the Australian Government (Department of Climate Change, Energy, the Environment and Water), that guides businesses, events, products, services, buildings and precincts toward carbon neutrality. It sets a clear standard for

1. Measuring greenhouse gas emissions across Scope 1, 2 and relevant Scope 3,

2. Reducing emissions where possible,

3. Offsetting any residual emissions using high-quality credits, and

4. Reporting publicly under independent verification.

Certified entities may use the Climate Active trademark and “carbon neutral” claim once they’ve followed the full process and signed a licence agreement.

Why was Climate Active introduced?

Originally launched in 2019 by the Morrison government to replace the earlier National Carbon Offset Standard, Climate Active was designed to make voluntary carbon-neutral claims credible and robust. It encourages businesses to measure and reduce their emissions first, before offsetting only residual emissions. This structure encourages genuine emission reductions and minimises the risk of greenwashing.

Key steps to certifying under the standard

Climate Active provides a six-stage pathway to certification:

1. Measure emissions

Establish your organizational boundary, then calculate emissions across Scope 1 (direct), Scope 2 (energy-related) and applicable Scope 3 (supply chain).

2. Set reduction targets

Participants are expected to set short-term (2025–2035) and long-term (2040–2050) gross emissions reduction targets, aligning with net-zero pathways.

3. Reduce where feasible

Develop and implement a clear Emissions Management Plan, which can include targets like achieving ratings via NABERS or Green Star for buildings.

4. Offset residual emissions

Purchase credible carbon credits - such as ACCUs, CERs, RMUs, VERs (Gold Standard), VCUs (Verified Carbon Standard) - that meet Climate Active’s quality criteria.

5. Report publicly

Submit a public disclosure statement each year and make it available via Climate Active’s website.

6. Verify with independent auditor

Undergo third-party validation and risk-based audits by Climate Active to assure integrity. Once complete, participants sign a licence and gain the right to use the trademark.

‍Who delivers – and audits – the process?

The Australian Government administers the Climate Active scheme - but certification isn’t a DIY affair.

• Consultants and software platforms play a vital role: they help clients map emissions, craft reduction plans, purchase and retire carbon credits, prepare documentation, and connect with accredited auditors.

• Government-appointed auditors or third-party verifiers then independently validate that emissions inventories, offset selections, and reports comply with the Standard.

So, while consultants provide technical support, official verification always comes from independent parties.

Why get certified?

1. Government tender eligibility: Some Australian federal and state tenders demand carbon neutral accreditation or proof of equivalent standards.

2. Investor and stakeholder reporting: Certification supports ESG reporting frameworks, including IFRS S2, and demonstrates tangible environmental commitment.

3. Brand differentiator: Certified entities can use the Climate Active brand and trademark to show credible climate leadership.

4. Risk mitigation: Independent auditing, offset traceability and annual reporting diminish exposure to greenwashing allegations.

How Much Does Climate Active certirication cost?

There are four main types of costs associated with becoming Climate Active certified:

• First, an annual licence fee is required to maintain your certification status.
• In addition, a third-party validation fee is incurred -typically ranging between $2,000 and $5,000.
• You will also need to pay calculation fees for the detailed analysis of your carbon footprint.
• And finally, offsetting fees to cover the cost of purchasing verified carbon offsets for any remaining emissions. The total offsetting cost depends on both the volume of emissions and the type of offset units selected.

It's important to understand that the validation, calculation, and offsetting fees are separate from the annual licence fee, as they fluctuate based on current market conditions and vary between providers.

The annual licence fee is based on the scale of your organisation's carbon account. It is calculated using your total emissions prior to offsetting and the number of certifications your organisation holds. This fee helps fund the administration of your licence, ensures proper use of the certification trademark, and provides tailored support services for certified organisations.

Is the Climate Active Standard being retired?

Concerns have mounted in 2025 – driven by criticism over offset integrity, declining participation and urgent calls for reform from bodies like the Carbon Market Institute. Major players (Telstra, Brisbane City Council, EnergyAustralia, GreenCollar) have pulled out citing greenwashing worries.

A public consultation (Oct–Dec 2023) recommended:

• Shifting terminology from “carbon neutral” to something more ambitious,

• Strong gross emissions targets,

• Limiting offset reliance,

• Mandatory renewable energy sourcing.

However, the government has not finalised reforms. On the ground, the program is still operating, with certifications ongoing under the current standard. Neither retirement nor suspension has occurred – yet. Critics view it as a legacy scheme in need of urgent modernisation, but not defunct.

Final Thoughts

Climate Active remains Australia’s foremost government-backed voluntary carbon-neutral certification, offering a structured pathway for robust climate action. But its future credibility hinges on upcoming reforms to reduce reliance on offsets, deepen emissions cuts, and align with science-based net-zero pathways.

For corporates, nonprofits, and local governments seeking to strengthen their climate credentials today, it still offers value - so long as emissions are genuinely reduced, offsets are high integrity, and processes are fully documented and verified.

If you're keen to align to the standards, get in touch! At Seedling we give SME teams the tools and expert support they need to measure, reduce and offset their emissions with confidence.

‍