Australia is about to take a big, constructive step on climate change policy: we will have a carbon price for the industry sector, under the safeguard mechanism.
It comes nine years after the Abbott Coalition government abolished Labor’s carbon price. The safeguard mechanism lay as a sleeper for many years – legislated in large parts under the Coalition government, but kept ineffective due to how it was implemented.
The mechanism will become effective as a so-called “baseline and credit scheme”, putting a price signal on about 30% of Australia’s greenhouse gas emissions. It will create a sizeable financial incentive to cut emissions in industry, even though it also relies on land-based carbon offsets.
