The “Safeguard Mechanism” reform legislation in Australia is getting the numbers it needs to come into force from July 1st, 2023. Australia’s lower house of parliament on Monday passed the reform as it got the necessary support from the Greens Party after months of negotiations.
Next, the Safeguard Mechanism has to pass the Senate and then become a law. Under the new legislation, 215 of Australia’s largest polluters including oil, gas, mining and manufacturing facilities, are limited to cut their emissions by 30% over the next 7 years. They would have to cut greenhouse gas emissions by 4.9% a year by 2030, and under a revised plan, will also have to restrict the use of carbon offsets.
Relevant: Australia Releases Its Safeguard Mechanism Reforms
The updated reform means that real emissions reductions will have to be achieved rather than offsetting with carbon credits. The legislation aims to help achieve the current ruling party – the Labor’s pledge to cut emissions by 43% by 2030.
The Green party has been key in the negotiations for strengthening Australia’s climate change commitments and achieving real emissions reductions. The Greens have long demanded the ruling Labor party to commit to no new coal and gas projects, but the idea has repeatedly been ruled out.
“Negotiating with Labor is like negotiating with the political wing of the coal and gas corporations… Labor seems more afraid of the coal and gas corporations than the climate collapse,” said Greens leader Adam Bandt.
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Thanks to a push from the Greens, the legislation now includes a hard cap on emissions which means polluting facilities would actually have to cut emissions rather than buy their way out of reductions by purchasing carbon offsets.
According to Mr Bandt, the hard emissions cap would make it unviable for 116 new coal and gas projects to carry on as they would be unable to get their emissions below the limit.



“The Greens have stopped about half of them [in the pipeline] but Labor still wants to open the rest… And, so, now there is going to be a fight for every new project that the government wants to open,” explained Mr Bandt.
Under the revised plans announced Monday, the government will offer at least A$1 billion ($665 million) for impacted industries like steel and cement to support decarbonization efforts. According to the announcement, the funding will not go toward any initiatives aimed at expanding the fossil fuel industry.
Australia’s Labor party came to power in May 2022 claiming to reverse the nation’s reputation as a climate laggard. Prime Minister Anthony Albanese has tightened national emissions targets but his administration has faced criticism over its support for fossil fuels developments.



According to Australia’s Climate Council, the country’s leading climate change communications organization, the updated Safeguard Mechanism is significantly strengthened, it will drive down emissions and make it more difficult for new coal and gas projects to be approved.
“This will be the Federal Parliament’s first reform to genuinely cut pollution in a decade,” said Amanda McKenzie, Climate Council CEO.
“After a decade of inaction, we welcome this progress on emissions reduction from the Australian parliament. It is true that this deal does not go as far as the science requires, but continued policy paralysis was unpalatable and momentum is essential,” said in a statement Glenn Walker, head of advocacy and strategy at Greenpeace Australia Pacific.
The Safeguard Mechanism is essential in reaching the country’s climate change target. Previous calculations of the updated reform released at the beginning of the year called for a delivery of 205 million metric tons of abatement between 2023 and 2030. Actual emissions reductions are far more critical for climate change mitigation compared to purchasing carbon credits while continuing emissions of greenhouse gases in a business-as-usual fashion.