After the recent Labour Party win, Australia’s parliament has passed the country’s most monumental emissions reduction legislation with a plan to reverse decades of pollution. A deal was brokered between the Labour government and Greens that legislated a hard cap on total emissions from large industrial facilities, accounting for 30% of total emissions.
Known as the ‘Safeguard Mechanism’, the reform legislation is key to the Labour government’s pledge to cut emissions by 43% by 2030, especially as the world’s 3rd largest fossil fuel exporter. From 1st July, 215 of Australia’s major polluting facilities, will need to cut emissions intensity by 5% a year, through a combination of absolute cuts or buying carbon offsets (cap & trade scheme). Whilst individual companies are able to purchase an unlimited number of offsets, total absolute emissions under the scheme are not to increase and are required to decrease over time.
The deal would slow down new coal and gas development proposals, but would have an indeterminate effect on industry expansion. Climate change minister, Chris Bowen, hailed the policy as a ‘landmark reform’ that would lead to a 205m tonne reduction in emissions by 2030 – equivalent to removing 2/3 of the nation’s cars off the road.