The Greens have offered the government their necessary support for its signature climate change legislation, with a single condition that new coal and gas projects are blocked from development.
The government will introduce its "safeguard mechanism" bill to the parliament this week, which would require the nation's top polluting facilities to reduce their emissions by 4.9 per cent each year to 2030, or face penalties.
The mechanism is the core of the government's plan to reduce emissions by 43 per cent by the decade's end.
The Greens say that is a weak target, and hold concerns that the safeguard mechanism would allow facilities to buy offsets to cover their obligations instead of cutting emissions.
But Greens leader Adam Bandt says the party is willing to put aside those concerns if the government will accept a single amendment to block new coal and gas projects.
"We're prepared to live with those and give Labor's scheme a go if Labor is prepared to stop opening coal and gas mines," Mr Bandt said.
"The Coalition has said no, that they're not interested, that means the government needs the Greens to get this through parliament.
"We are up for good-faith discussions with them, but the sticking point at the moment is new coal and gas projects."
More than 100 gas and coal projects would be blocked under proposal
The Department of Industry, Resources and Energy has recorded more than 100 coal and gas projects either in development or being considered with commercial start dates before 2030.
Some of those projects are small expansions but others such as the Scarborough and Browse gas developments would become among the biggest in the country.
Mr Bandt says the government's 43 per cent emissions target would be "beyond reach" if those projects proceeded.
But with just months until the government's intended July start date for the proposed laws, it would cause a drastic change in the nation's energy trajectory.
Climate Change Minister Chris Bowen has repeatedly said the government would not agree to a moratorium on new coal and gas.
"Ultimately, I'm not here to tell the Greens how to vote," he said.
"We have a relationship with the Greens where we can talk issues through but within parameters, and the parameters of which I'll discuss these issues is the election mandate we sought and received."
The Greens say any counteroffer made by Labor would be taken to its party room for consideration, but that Labor needed to "get serious" about the question of opening new coal or gas facilities.
"You can't fix the problem while you're making it worse, you can't put the fire out while you're pouring petrol on it.
"At the moment, Labor's climate laws will see pollution from gas actually go up, that's not a climate package.
"Labor has got to get serious about this question of opening new coal and gas mines."
Industry and union groups infuriated by demand
Australian Workers Union secretary Daniel Walton said the Greens risked repeating the past, citing the party's role in torpedoing an emissions trading scheme in 2009 and fuelling instability in climate policy.
"The guiding principle of the safeguard mechanism is that it’s focused on large emitters, because that’s where you can achieve large reductions," Mr Walton said.
"It’s how you start responsibly guiding Australia onto a sustainable path to net zero by 2050."
The head of national employer association Ai Group, Innes Willox, agreed the Greens demands put stronger climate action at risk.
"With the Greens and the Coalition potentially scuttling the federal government's safeguard mechanism, we are watching history repeat," Mr Willox said.
"The Coalition's decision to vote against changes it had previously proposed, and the reported Greens positioning once again make Australia look incapable of reaching agreement on how to utilise assets to build economic success. A form of political extremism is at play here.
"It has cost us before and it could cost us again."
Chamber of Commerce boss Andrew Mackellar said it was "not the time for another climate war".
Mr Mackellar said a ban on new coal and gas would hamper energy supply before renewable sources were available, driving up power prices and causing blackouts.
The Climate Council said new coal and gas projects should be assessed through strengthened environmental protection laws in the first instance, as the safeguard mechanism was not designed to be a review process for new projects.
But they said new projects that would emit more than 100,000 tonnes a year and be set for inclusion in the safeguard mechanism should be paused until planned reforms to environmental protection laws are completed.
The Coalition last week decided it would oppose strengthening the safeguard mechanism, despite calls from business and environment groups to support it.
If the Greens support the proposed laws, the government would still need the support of at least two other crossbench senators to pass its legislation, though newly independent senator Lidia Thorpe has committed to continue to vote with the Greens on climate legislation.
It hopes for the laws to be in effect by July.
