What can we expect in Australia’s new climate law?

By Peter Burnett

Australian climate minister Chris Bowen has promised to introduce a Climate Change Bill when Australia’s newly-elected Parliament convenes in late July. The Bill won’t be available until then but we already have a fair idea of what it is likely to say.

The story so far

What used to be Australia’s main climate law, the Clean Energy Act 2011, imposed a price on carbon. It was repealed by the then-new Abbott government in 2014 as part of its ‘axe-the-tax’ platform.

As far as I know, this is the only reversal of a carbon price, anywhere, ever. Hopefully it will also be the last, because the abolition of such an effective policy instrument was a major loss.

Several other climate laws survived Prime Minister Abbott’s anti-climate change stance in amended form, including the Act establishing the independent Climate Change Authority (CCA). The CCA lost its power to advise on Australia’s overall emissions target but retained its power to review specific climate mitigation policies.

Some Australian states and territories have their own climate change laws that set targets, broadly similar to what Bowen is now proposing.

Shape of the new law

The Climate Change Bill will not seek to reimpose a carbon price — the government plans to use an existing law brought in by the Abbott Government known as the ‘safeguard mechanism’ to reduce allowable emissions for the largest polluters (over 100,000 tonnes C0₂-e) over time.

Rather, the new Climate Change Bill will deal with national targets. Minister Bowen outlined its content in a recent speech at the National Press Club.

The Bill will enshrine both Australia’s ‘net zero by 2050’ goal and its new Paris ‘nationally determined contribution’ of a 43% reduction in emissions by 2030.

It will also restore the CCA’s role of advising Government on future targets, starting with the 2035 target. In addition, the CCA will assess progress against existing targets, with these assessments made public.

Separately, the climate minister will be required to report annually to Parliament on progress in meeting targets.

Finally, the bill will paste the new climate targets across into the formal objectives and functions of several government agencies, including the Australian Renewable Energy Authority (ARENA, which makes grants for new but pre-commercial renewable energy technologies and businesses) and the Clean Energy Finance Corporation (CEFC, which operates in a similar space but makes loans rather than grants).

Some interesting implications

Bowen says that the twin aims of requiring the minister to report to Parliament each year are to force government to be transparent and to focus the minds of parliamentarians on climate change as ‘our most pressing challenge’. Hopefully he is right on both counts and Parliament will focus increasingly on the substance of climate policy and progress in reducing emissions and less on the political posturing that has been so dominant to date.

More interesting than the pasting of targets across into the ARENA and CEFC legislation is the proposal to paste the targets into the objectives of bodies that are not dedicated climate agencies, including Infrastructure Australia and the Northern Australia Infrastructure Fund.

Such a requirement is likely to force these infrastructure bodies to expand their horizons beyond conventional cost-benefit analysis and to evaluate in detail whether there are more climate-friendly alternatives to what is proposed. For example, climate considerations might force the ditching of a road upgrade in favour of rail or sea-carriage for long distance freight.

In a similar vein, legally-enshrined climate targets should have a ripple effect on all government deliberations. In particular, I would expect the government to amend the cabinet handbook to require that proposals evaluate climate implications against the target, including by considering low-emission alternatives, on a routine basis.

Under such a regime, a proposal to purchase new tanks for the army would be required to consider electric propulsion or, more realistically in the short term, a commitment to use biofuels or other synthetic fuels, despite the additional expense. Failure to consider such alternatives would open the government to criticism that it was not taking its own legally-enshrined commitment seriously.

Getting the law passed

While Bowen made it clear that the government regards legislated targets as best practice for the policy certainty that they provide, he also stressed that legislated targets are not strictly necessary.

In this light, he says that the government is open to ‘complementary’ amendments but will withdraw the bill if it cannot secure Senate support for the fundamentals of its agenda.

For example, if the Greens and climate-friendly cross-bench Senators were to oppose the bill on the basis that the targets were not ambitious enough, the government would probably withdraw it. Clearly the government regards itself as treading a fine line on climate ambition and does not wish to risk being held to ransom by forces on its Left, as it was in the Rudd years.

On the other hand, it is less clear whether the government would regard amendments based on Independent MP Zali Stegall’s Climate Change (National Framework for Adaptation and Mitigation) Bill 2021 as ‘complementary’.

Would the government accept amendments to enshrine, not just the 2030 target, but a rolling series of five yearly ‘emissions budgets’ and a full ‘national adaptation plan’? Or would it agree to legislate for a permanent Parliamentary Joint Committee on Climate Adaptation and Mitigation with a supervisory role over the CCA?

Watch this space for a report on the debate.

Banner image: Image by Gerd Altmann from Pixabay