CANBERRA, Australia, September 6, 2015 (ENS) –  The Abbott Government is calling for public comment on the proposed rules for its Emissions Reduction Fund safeguard mechanism issued Wednesday. Critics say minimal compliance obligations will allow emissions to grow 20 percent by 2030.

The Emissions Reduction Fund provides incentives to businesses to reduce their greenhouse gas emissions. It aims to reduce emissions at lowest cost and contribute towards Australia’s 2020 emissions reduction target of five percent below 2000 levels by 2020.

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Yallourn-W power plant in the state of Victoria burns brown coal. (Photo by Yallourn Energy Pty Ltd)

The Emissions Reduction Fund has three elements: crediting emissions reductions, purchasing emissions reductions, and safeguarding emissions reductions.

The safeguard mechanism will start on July 1, 2016 and will be an integral part of the Emissions Reduction Fund – along with its crediting and purchasing elements.

Environment Minister Greg Hunt said, “With our Direct Action plan we will meet Australia’s 2030 target of reducing emissions by 26-28 percent below 2005 levels.”

Taking aim at the previous Labor Government’s carbon tax, which was canceled by the current Coalition Government, Hunt said, “Only the Coalition is committed to taking serious action to tackle climate change without hurting Australian families and businesses in the process with a painful carbon tax.”

The Emissions Reduction Fund, ERF, will pay Australian businesses and households to take what Hunt calls “practical, direct action to reduce emissions and improve the environment.”

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White Cliffs Solar Power Station, New South Wales, Australia (Photo by Richard Gifford)

Actions could include: upgrading commercial buildings, improving energy efficiency of factories and houses, reducing power plant emissions, capturing landfill gas, reducing waste coal mine gas, reforestation, improving agricultural soil, upgrading vehicles, improving transport logistics and managing grassland fires.

The ERF’s safeguard mechanism is supposed to ensure that emissions reductions purchased by the government are not displaced by increases in emissions above business-as-usual levels elsewhere in the economy.

The government has provided A$2.55 billion to establish the Emissions Reduction Fund in the 2014-15 Budget, with further funding to be considered in future budgets.

Businesses and the community are invited to make submissions about the drafting of the safeguard mechanism regulations by September 16 and rules by September 21.

The government will consider the submissions received during this public consultation period before finalizing the rules and regulations in October.

Critics object to the Abbott Government’s policy of setting the ERF’s baseline year as the highest, not the lowest, year of emissions in the past five years.

They say that to curb climate change Australia needs to reduce greenhouse gas emissions, not allow big business especially mining companies, to keep polluting as much as they have in the past five years, without facing any penalty.

The country’s largest environmental group, the Australian Conservation Foundation, ACF, is critical of the entire Emissions Reduction Fund and its safeguard mechanism.

ACF climate change campaigner Suzanne Harter said, “What is clear from the safeguard mechanism released today is that the Government is going out of its way to protect the largest polluters in Australia.”

She quotes Environment Minister Hunt as saying, “It is our clear expectation that no businesses will pay penalties.”

Senator Larissa Waters, Australian Greens Deputy Leader and climate change spokesperson, said, “The government’s so-called safeguard mechanism won’t make anyone safer from climate change.”

“Minister Hunt says the government has no intention of fining any big polluters, making it clear that the mechanism is designed to fail,” said Waters.

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AGL’s coal-fired Bayswater power plant in New South Wales (Photo by Macquarie Generation)

“For example, AGL, the country’s biggest polluter, gets cash through Direct Action and is allowed to increase its overall current emissions,” said Waters. “The mechanism is a toothless tiger that will allow big businesses to pollute more than they do today without having to pay anything toward the damage this will cause.”

An integrated energy company, AGL said in a statement that it is “taking action to responsibly reduce its greenhouse gas emissions while providing secure and affordable energy to its customers.”

AGL operates base, peaking and intermediate generation plants, that burn coal and gas, as well as renewable sources, including hydro, wind, solar, landfill gas and biomass.

RepuTex, Australia’s largest provider of energy and emissions market analysis, said Thursday that the Abbott Government’s safeguard mechanism will not protect the climate, but will allow greenhouse gas emissions to grow.

The new amendments released Wednesday will enable companies to further adjust their baselines. They are “likely to erode compliance demand, specifically from the coal mining and oil and gas industries,” RepuTex warned.

“With minimal compliance obligations on companies, we project emissions covered by the safeguard scheme will grow by around 20 percent through to 2030,” RepuTex said.

“This suggests a significant disconnect between emissions growth and the government’s new post-2020 emissions target,” said RepuTex, “while in parallel, the delay of emissions reductions indicates that any future compliance market may be running-to-stand-still, with any compliance scheme likely to face a more acute emissions reduction slope to meet the new 2030 emissions target.”

Announcing last month that his government would pledge to cut Australia’s carbon emissions by at least 26 percent below 2005 levels by 2030, Prime Minister Tony Abbott called the pledge “a responsible move” that does not sacrifice the economy for the environment.

The target leaves Australia trailing most other nations emissions cuts beyond 2020, although the coal-producing country has some of the highest greenhouse gas emissions per person of any industrialized country.

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