Explainer

What the Greens' climate deal with Labor means for Australia's biggest polluters

Labor has taken a major step towards securing a key piece of climate legislation, after the Greens confirm its changes to the safeguard mechanism. Here's what you need to know.

A power station.

Labor is a step closer to securing its changes to the climate safeguard mechanism. Source: AAP

KEY POINTS:
  • The Greens have confirmed they'll back Labor's safeguard mechanism changes.
  • Leader Adam Bandt declares the fight against new coal and gas goes on.
  • Labor's legislation is now likely to pass the parliament this week.
A key piece of Labor's climate legislation is likely to pass parliament, after it struck a compromise deal with the Greens over new coal and gas.

Greens leader Adam Bandt confirmed on Monday he will back , despite its refusal to rule out new coal and gas projects.

Labor is overhauling the safeguard mechanism scheme, first implemented by the former Coalition government, and is eager to pass the changes this week to ensure they're in place by July.
Man in suit and glasses smiling.
Anthony Albanese says Monday's development is a win for the environment and the economy. Source: AAP / Mick Tsikas
With the Greens' support secured, Labor now needs backing from two other crossbenchers. It remains in talks with independent senator David Pocock, who has raised concerns over .

Prime Minister Anthony Albanese has declared Monday "a great day for our environment", and the Greens say the concessions are a "big hit" to coal and gas in Australia.

Here's what you need to know.

What's in Labor's climate deal with the Greens?

There'll be a ceiling on gross greenhouse gas emissions, which won't be able to exceed current pollution levels of 140 million tonnes a year. That 'hard cap' will decrease over time.

The bill will include a 'pollution trigger', which will compel the climate change minister to test a project's impact on the hard cap and net carbon budgets. If the project is predicted to breach those limits, they'll have to consult and recalibrate the rules, or impose conditions on new entrants.

It will apply to the country's 215 biggest emitters and force them to reduce their emissions by 4.9 per cent each year.

Any company looking to use carbon offsets for more than 30 per cent of their baseline will be required to justify that. A review into the controversial offset scheme will be conducted in 2026-27.

All new gas fields for export will also need to be carbon neutral from day one, but the deal does not include a full ban on coal and gas, which the Greens are pushing for.

What's being said about the climate deal?

Mr Albanese declared Monday's development as an economic and environmental victory, describing the mechanism as a "vehicle" to achieve its mid-term emissions reduction target.

"The fact is that we, in Australia, have seen the devastating impact of climate change ... in the time in which I have been prime minister, we have dealt with bushfires, we have dealt with flooding, we deal with the impact ongoing of climate change. That's why we need to be a part of global action," he said.

Climate and Energy Minister Chris Bowen said the alternative would have been to "walk away" from net zero emissions by 2050.

"[The changes] do two things: strengthen accountability, transparency and integrity of the scheme. Secondly, [they] provide extra support for those strategic manufacturing industries that are so important for our economy and transition as well," he said.
Man in suit and glasses standing outside.
Greens leader Adam Bandt says the fight against coal and gas continues. Source: AAP
Mr Bandt said the Greens had prevented Labor from expanding emissions from coal and gas coal and gas projects to between 155 and 184 megatonnes, with the new deal to cap them at 140 megatonnes.

But he insisted the party's fight against all new coal and gas continues.

"Under the original design of the safeguard mechanism, pollution from coal and gas was going to go up ... [but] this cap will be a hard cap on actual emissions and the coal and gas corporations will not be able to offset their way out of it, no matter how many offsets they buy," he said.

Coalition climate and energy spokesperson Ted O’Brien claimed the deal amounted to a “carbon tax on prosperity” and a “hard cap on growth of the Australian economy”.

Mr O’Brien claimed Australians hit by cost-of-living pressures would be forced to dip further into their pockets.

“This is going to jeopardise the future of the Australian economy. It will make the Australian economy weaker and the Australian people poorer,” he said.

“It will ultimately be the Australian people, who will have to pay for the carbon tax that Labor introduces in the deal done with the Greens today.”
Climate Council chief executive Amanda McKenzie described the reform as "federal parliament’s first reform to genuinely cut pollution in a decade".

"Today’s agreement is a massive wake up call to any board or business executive who thinks they can keep stalling genuine climate action. The era of climate gridlock in Australia is over and the only viable path for any business is genuine, deep cuts to carbon pollution this decade," she said.

Glenn Walker, Greenpeace Australia Pacific head of advocacy, said the reforms, while welcome, did not go far enough.

"We remain concerned about coal and gas companies simply buying up carbon offsets rather than reducing emissions," he said.

“The world’s leading scientists are crystal clear; we cannot open up new coal, oil and gas mines if we are to have a chance at a safer future. The mining and burning of coal, oil and gas are the number one drivers of climate change. Enough is enough."

- With additional reporting from AAP.

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5 min read
Published 27 March 2023 3:00pm
Updated 27 March 2023 3:05pm
By Finn McHugh
Source: SBS News

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