The Greens have declared a major victory against the development of new coal and gas projects in Australia after securing a deal to add a “hard cap” on emissions, as well as a pollution trigger to Labor’s Safeguard Mechanism amendments.
In separate statements on Monday, federal energy minister Chris Bowen and Greens leader Adam Bandt confirmed the two parties had agreed on a number of significant changes to the proposed legislation which the Greens say will put Beetaloo and 116 new coal and gas projects “on the ropes.”
The deal breaks the political deadlock on Labor’s proposed reboot of the Safeguard Mechanism, originally a Coalition policy, clearing the way for a further amended Bill to make its way through Parliament and be put in place come July.
The raft of additional reforms agreed to by the two parties – 13 of them, according to a brief from the Greens – include a “hard cap or ceiling” on actual or absolute emissions, which won’t be able to exceed current pollution levels and will decrease over time.
According to Bandt, this means that pollution Australia’s biggest emitters will now go down and not up, as it was set to under Labor.
“[This means] real pollution must actually come down and the coal and gas corporations can’t buy their way out of the cap with offsets,” the Greens leader said on Monday. “This puts a limit on coal and gas expansion in Australia.”
To that end, the agreed reforms to Safeguard would also include a pollution trigger, that will require Bowen to test a new or expanded project’s impact on the hard cap and net carbon Budgets.
In short, says Bandt, this means that, “for the first time in history” new projects must be assessed for their impact on climate pollution and can be stopped if they are projected to breach the pollution cap.
In other words, he adds, “Every new coal and gas project that gets approved from here on in is Labor’s direct responsibility.”
Another key reform will see expansions to existing gas supply projects treated as new facilities and therefore given a net zero baseline for the CO2 in the new fields.
More specifically, in the case of the massive and controversial Beetaloo Basin fracking project in the Northern Territory, the parties have agreed that all new entrants in the basin will have to have net zero scope 1 emissions from day one.
Greens spokesperson for resources, Darinda cox, says these reforms mean that both Beetaloo and the Barossa gas project off the coast of Darwin have effectively been “derailed.”
“There are serious questions raised about whether these climate bombs will be financially viable now, raising a red flag to investors pouring money into these projects,” Cox said on Monday.
How Labor will spin this element of the Safeguard Mechanism deal to the fossil fuel lobby remains to be seen.
But in a media release Bowen said the “overdue, sensible reforms” would ensure Australia’s largest emitters were competitive in a decarbonising global economy and made a fair contribution to the national emissions reductions task.
“Today, we are a step closer to achieving net zero by 2050,” the minister said.
“We thank those across the Parliament who continue to approach this legislation in a constructive way to ensure accountability, transparency and integrity for the scheme, and ensure flexibility and support for industry.
“These reforms are the culmination of months of extensive feedback from Safeguard businesses, industry associations, climate and community groups, academics and private individuals.
“Business and climate groups have been clear that the Parliament should pass the strengthened legislation in front of it and deliver overdue policy certainty.”
Bowen says the government will finalise the further amended Safeguard Rules next month, keeping the scheme on track to be in operation by the start of July, 2023.
The experts, and critics, react…
The deal seems even to have passed muster – sort of – with one of the most harsh critics of Labor’s treatment of the Safeguards Mechanism, The Australia Institute.
TAI says that while the reformed mechanism “still falls short” of the ban on new coal and gas that the science requires, “for the first time there will be a limit on gas and coal expansion in Australia.”
“The new hard cap on pollution will force hard choices about whether to use Australia’s new emissions budget on new coal and gas projects, or for refining critical minerals like lithium as the world moves towards a clean economy,” TAI says.
The Climate Council says it welcomes the “historic agreement” between Labor and the Greens, on what will be the first legislation in a decade that will regulate climate pollution.
Climate Council head of advocacy, Jennifer Rayner, also welcomes the anticipated shift in focus away from the Safeguard Mechanism and on to improving other national climate policies.
“The Safeguard Mechanism is just one weapon in the war to drive down Australia’s emissions. We need to throw the whole arsenal at tackling harmful climate change,” Rayner says.
“As a priority, Australia needs strong environmental laws that properly consider climate impacts, an end to fossil fuel financing and public subsidies, much tighter limits on offsetting to ensure we are achieving genuine and steep emissions reductions.”
Porfessor Peter Newman from the Curtin University Sustainability Policy Institute and a member of the IPCC says the Greens-Labor agreement sends a “very strong signal” to industry and banks that they must do better on climate.
“The detail is still needed but the message is quite clear that there will be no hiding place and that 43% by 2030 implies big reductions every year,” Newman said on Monday.
But Newman remains skeptical on how new coal and gas projects fit into the Safeguard Mechanism, saying this part of the deal remains “clouded in process detail.”
“I can only think that in the detailed processes now being created by the Safeguard Mechanism legislation there will be wriggle room for the minister to stop more new fossil fuel projects and create an historic legacy of serious climate change mitigation,” he adds.
Australian Industry Group chief Innes Willox says the deal is not one “for the ages” but is a good deal for today.
“The treatment of new facilities appears to strike a workable balance, providing pathways for new projects that stack up to go ahead without adding to burdens on existing facilities or threatening national emissions goals.
“Strengthening transparency around offsets and their use will be helpful in adding to confidence,” Willox added, noting that “government will need to be ready to respond quickly if problems emerge with particular projects or methods.”
Carbon Market Institute CEO John Connor describes the agreement as a “positive development, and a real sign of climate progress after 10 years of political division and delay.”
“Ultimately, we needed a policy platform that urgently addresses industrial sector decarbonisation, and this agreement provides a stepping stone for progress.
“But it must scale over time to ensure it continues to drive the transition of Australia’s industrial sector and broader economy.”
Meanwhile, in Parliament, Bowen was in full flight during Question Time on Monday afternoon, declaring the climate wars “officially in retreat.”
“This is important because after 10 years of denial and delay, the time for action is, of course, now,” Bowen said.
“It’s important as the world decarbonises that Australia gets its share of the economic action. It was not happening before May last year.
“Business as usual would see emissions go up and economic opportunities lost. Business as usual is not acceptable for this governments.
“We will work with the business community to see emissions down and jobs up and that’s exactly what we are doing.”
