Concerns Labor’s proposed changes to the safeguard mechanism will prove fatally ineffectual have been fuelled by government officials’ refusal to confirm whether their own modelling shows the policy will compel the country’s biggest polluters to decarbonise.
On its face, the proposed scheme requires roughly 215 of Australia’s heaviest industrial emitters to cut emissions by 4.9% a year, which companies could conceivably achieve by making cuts onsite or buying carbon offsets.
But the absence of any cap on the number of carbon offsets that may be purchased for any one project, coupled with the stated unwillingness of the government to block new coal and gas ventures, has raised concerns the scheme will do little to incentivise any reduction in emissions.
Under questioning from Greens Senator Sarah Hanson-Young during a fiery Senate hearing on the proposed changes, Department of Climate Change officials declined to disclose the results of government-commissioned modelling on the likelihood of onsite abatement, citing cabinet confidentiality.
“As you’re aware, the government undertook analysis of the likely suite of onsite abatement vis-à-vis the domestic offset market,” said government safeguard taskforce head Edwina Johnson.
“That analysis is covered by cabinet-in-confidence and that full analysis fed into cabinet deliberations.”
In answer, an exasperated Hanson-Young said the government’s position made it impossible for the Greens and wider Senate crossbench to gauge whether Labor’s revamped safeguard mechanism would in fact, as the government claims, reduce emissions in line with its legislated 43% reduction target by 2030.
“Isn’t the whole point of this whole program to incentivise and drive down actual pollution, not just find a way to offset it?” she said.
“Our job is to assess whether the plans being put forward by the government are legitimate, whether they’re effective and whether they’re efficient. If the government cannot give us [this] information, how on earth are we meant to be expected to vote in support of this?”
Labor is currently locked in furious negotiations with the Greens and other Senate crossbench members over its safeguard mechanism bill, which it claims will convert what was a failed regulatory instrument under the former Coalition government into a carbon trading scheme that drives down emissions.
The policy has won the backing of the fossil fuel industry but attracted little in the way of support from climate scientists and environmentalists, who have likened it to greenwashing.
Despite the Greens’ serious reservations about the efficacy of Labor’s revamped safeguard mechanism, the minor party has indicated a willingness to overlook these concerns and support its passage through the Senate in exchange for a moratorium on new coal and gas projects.
“Labor’s safeguard mechanism says pollution from coal and gas can go up and in fact they even forecast pollution from gas production to go up. It [also] bakes in new coal and gas projects,” said Greens Leader Adam Bandt this week.
“The objective of good climate policy should be to cut pollution. So, I think the more people look at it, the more it’s understood that actually there’s a reason [the fossil fuel industry] backs [the policy].”
Bandt added that there was “capacity for this to be a golden era of reform in this parliament — to pass laws that tackle the climate crisis, protect the environment, that tackle the cost-of-living crisis” but that Labor’s unwillingness to cooperate on any of these fronts was hindering this prospect.
While government officials have disputed Bandt’s claim the revamped safeguard mechanism will increase rather than reduce emissions by 2030, they did not explain whether their own projections were based on existing and recently approved gas, oil and coal projects alone, or whether the data incorporated likely emissions from future coal and gas projects.
Meanwhile, independent Senator David Pocock — whose vote in the Senate will potentially prove crucial — has raised concerns about the ongoing integrity of the safeguard mechanism, given a number of the recommendations made in the Chubb review are yet to be implemented.
In the Senate inquiry, government officials agreed with Pocock that the “integrity of the [scheme] relied on the integrity of the carbon market”, but said it was “very important” that the revamped model commence July 1, regardless of whether those recommendations were implemented.
It appears to be a sentiment shared by Climate Change and Energy Minister Chris Bowen who, rather than compromise with the Senate crossbench on the policy, is now reportedly seeking to override their concerns by issuing the changes via ministerial regulation.
Those rules could in turn be overturned if the crossbench and the Coalition combine forces and raise a disallowance motion.
Many climate and environmental scientists, for their part, still hold serious reservations about the wider integrity of the scheme, with one recent analysis estimating there could exist up to 60 million carbon credits of low integrity.
Is the government doing enough to tackle climate change, or is it just more hot air? Let us know your thoughts by writing to letters@crikey.com.au. Please include your full name to be considered for publication. We reserve the right to edit for length and clarity.
