Changes to the emissions baselines proposed by the Coalition mean businesses are less likely to breach rules in the short term

This article is more than 1 year old

This article is more than 1 year old

The Greens have expressed alarm over changes to the emissions safeguard mechanism that will make it less likely that heavy polluters such as mines and smelters will be caught by the scheme – at least in the short term.

In the week following an attempted pivot on climate change policy by the Morrison government, the Department of Environment and Energy has published amendments to the safeguard mechanism that take effect immediately.

The Greens climate spokesman, Adam Bandt, says the changes outlined in the new departmental edict “were requested by big polluters and they will make it easier for them to pollute more”.

“This is like catching someone doing 100km/h in a 60km/h zone, but instead of fining them the government just lifts the speed limit to 110km/h,” Bandt said.

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The Coalition flagged an intention to overhaul the safeguards mechanism in a review of its climate policies released in December 2017. That review signalled baselines could “increase with production, supporting business growth”.

The safeguards mechanism – part of Tony Abbott’s Direct Action scheme, which is at the centre of the recent climate redux by Scott Morrison – sets emissions “baselines”, or limits, for big polluters.

The mechanism is supposed to ensure pollution cuts paid for through the taxpayer-funded emissions reduction fund – rebadged by Morrison last week as the “climate solutions fund” – are not undone by a blowout in emissions in other parts of the economy.

The 2017 climate review signalled the mechanism would be loosened to ensure business did not face restraints on growth, with the changes to be implemented in the 2018-19 compliance year, in consultation with industry.

The review said the mechanism needed to be “fairer and simpler” and it said changes were required to “address the risk of potential constraints on business growth raised by a number of stakeholders through the review”.

The department has now circulated adjustments to the scheme which it says are “in line with the 2017 review of climate change policies”.

One of the new proposals allows businesses to update baselines annually “for actual production where facilities use eligible production variables, so they continue to reflect facility circumstances” – which suggests baselines will be able to vary with production.

Business sources have told Guardian Australia the proposal circulated by the Morrison government will put businesses in a situation where, in the short term, they are less likely to breach.

But some point out the reboot could also be used by an incoming Labor government as the foundation for toughening the scheme if the opposition keeps the architecture as part of a new policy covering heavy emitters.

The overhaul could provide the foundation for a cap and trade scheme, or an emissions intensity scheme, by, in essence, tidying up the mechanism before ratcheting down the baselines. The shadow climate change minister, Mark Butler, has flagged “some kind of emissions trading scheme” for liable entities – big polluters emitting more than 25,000 tonnes of carbon a year.

Guardian Australia reported last March 16 Australian industrial sites had breached the government-imposed greenhouse gas emissions limits, which forced them to buy millions of dollars in carbon credits.

Nearly 60 Australian industrial sites have previously been given the green light to increase pollution under the scheme, which is widely regarded as inadequate. Emissions have been rising since the Coalition repealed the carbon price and replaced it with the Direct Action scheme.

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Bandt said the Greens would explore ways to stop the changes from proceeding once parliament resumes for the budget session, and he declared Labor needed to take a clear stand on the issue. Bandt said Labor, if it wins the election in May, “need to change the rules to reduce pollution, not encourage it.”

Tim Baxter from the Australian-German Climate and Energy College and Melbourne Law School said the overhaul meant the safeguard mechanism was now “totally useless”.

“As small as the penalties were in the first year of the safeguard mechanism, and they were tiny for companies as large as those covered by the safeguard mechanism, this reform seems to be designed to ensure penalties never happen again,” Baxter said.

“By moving to baselines that vary with production, it becomes more and more difficult for facilities to breach their limits”.

“The safeguard mechanism moves from being next to useless in providing for a safe climate, to being totally useless”.

“Under the previous default rules, while there was nothing compelling emissions to come down, there was at least a limit on their growth. Under the revised rules, there is neither”.