A compromise deal between Australian Greens and the governing Australian Labor Party has secured a hard cap on greenhouse gas emissions, putting new coal and gas projects “on the ropes,” the Greens say.
But observers say the announcement falls short of a full fossil fuel ban and won’t deliver the emission reductions that climate science demands.
The hard cap, or ceiling, on absolute emissions means that “real pollution must actually come down and the coal and gas corporations can’t buy their way out of the cap with offsets,” said Greens leader Adam Bandt in a statement late last month. “This puts a limit on coal and gas expansion in Australia.”
The deal struck with the Labor Party represents “a major shift from the Greens, with the minor party providing crucial support for the reform despite the scheme not meeting the party’s demands for the government to veto new coal and gas projects,” writes the Sydney Morning Herald.
The agreement modifies the Safeguard Mechanism, first set up in 2016 by the former Coalition government as an important component of Australia’s Emissions Reduction Fund, which in turn works as the government’s main climate policy tool. The fund is meant to hold the country to its emissions targets, while the mechanism ensures that the reductions it achieves are not displaced by emissions increases elsewhere in the economy.
It covers designated large facilities that emit more than 100,000 tonnes of carbon dioxide equivalent (CO2e) each financial year. Mining, gas production and processing, manufacturing, and transport facilities are among the 215 covered facilities, accounting for roughly 30% of the country’s greenhouse gas emissions.
The mechanism originally allowed companies to buy carbon credits instead of actually cutting back their emissions. But now, the amendments set three levels of emissions caps that apply to all covered facilities, writes Frances Medlock, Commonwealth and government liaison solicitor for the non-profit Environmental Defenders Office.
First, a net emissions cap sets a budget of 1,233 million tonnes for all the carbon dioxide equivalent the facilities can produce between 2020 and 2030.
Then, by 2030, “point-in-time caps” limited the total carbon pollution produced by all the companies covered by the bill to no more than 100 million tonnes
By 2050, the companies mist reach net-zero.
The designated facilities must begin reducing their absolute emissions beginning in 2024. That’s because the last of the three rules only counts the real emissions cuts the companies have made, not the credits they may have bought to offset their pollution.
“While the final version of the bill is not as ambitious as the science requires, it does improve the Safeguard Mechanism significantly,” Medlock says.
It now also includes a “pollution trigger”, which requires the climate change minister to assess new projects for their impact on climate pollution “for the first time in history,” Bandt said.
“Labor now has the power to stop coal and gas projects that would breach the pollution cap,” he added. So “every new coal and gas project that gets approved from here on in is Labor’s direct responsibility.”
Though the Greens and Labor are celebrating the amendments as a landmark reform, critics say it doesn’t go far enough, falling short of an outright ban on new gas and coal. Others say the government should also turn its attention to other national climate priorities that can help reduce emissions.
“The Safeguard Mechanism is just one weapon in the war to drive down Australia’s emissions,” said Jennifer Rayner, head of advocacy at the Climate Council. “We need to throw the whole arsenal at tackling harmful climate change.”
“As a priority,” she added, “Australia needs strong environmental laws that properly consider climate impacts, an end to fossil fuel financing and public subsidies, and much tighter limits on offsetting to ensure we are achieving genuine, and steep emissions reductions.”
