Climate change Bills introduced to House of Reps

A package of Bills has been introduced to the House of Representatives by the Gillard government to tackle climate change and promote a clean energy future.

The 18 Clean Energy Bills and the Steel Transformation Plan Bill will put a price on carbon pollution, promote investment in renewable and clean energy technologies and support action to reduce carbon pollution on the land.

The reforms are a central element in the government’s policies to modernise the Australian economy and position it to meet the challenges of the future. They are said to ensure that Australia reduces its carbon pollution in the most economically efficient manner while including extensive measures to support jobs and competitiveness.

The Bills implement the key elements of the government’s Securing a Clean Energy Future plan announced on 10 July 2011. The legislation has been finalised following widespread consultation with stakeholders and the broader community.

The government released exposure drafts of the main Clean Energy Bills in late July. Since then the government has met representatives of the states and territories; convened a forum for peak industry, environmental, community and other non-government organisations; met with legal and technical experts; and consulted directly with business and other stakeholders.

More than 300 submissions on the exposure drafts have been considered and taken into account in the Bills introduced. A number of useful suggestions have been adopted to clarify the legislation and implement the government’s plan effectively.

In response to calls from a number of stakeholders that they would like to be part of the carbon price mechanism to manage their liability for liquid fuel emissions, the Bills will allow for the establishment of an opt-in scheme. This will enable large users of specified fuels to voluntarily opt into the carbon price mechanism instead of paying the equivalent carbon price under the fuel tax or excise systems. In a significant endorsement of the government’s policy, stakeholders from the aviation industry have indicated they would prefer to be covered by the carbon price mechanism because of the opportunities it will give them to manage their liabilities for fuel emissions. These arrangements will apply from 1 July 2013 to allow for appropriate implementation two years before the start of the carbon price mechanism’s flexible price period.

The objects of the Clean Energy Bill have been clarified to recognise that it is in Australia’s national interest that average global temperatures increase by not more than 2°C above pre-industrial levels and that a central objective of the Bill is to put a price on carbon pollution in a way that encourages investment in clean energy, supports jobs and competitiveness in the economy, and supports Australia’s economic growth while reducing pollution.

The Jobs and Competitiveness Program’s regulation-making powers have been modified to reflect the government’s commitment to giving industry notice of changes to assistance and to consider the independent report of the Productivity Commission.

Technical changes have been made to smooth implementation with respect to:

• carbon price liability in the natural gas supply chain
• arrangements for coverage of joint ventures
• disclosure of significant holdings of carbon units
• legal title to carbon units
• clean energy investment plans in the Energy Security Fund
• clarification of anti-avoidance provisions
• operation of an equivalent carbon price on synthetic greenhouse gases
• the Regulator’s registration and suspension powers under the Renewable Energy Target
• the functions and qualifications of the Land Sector Biodiversity and Carbon Board

These changes will enhance public confidence in the integrity of the mechanism, give industry clarity and certainty over their obligations and ensure regulatory costs are minimised.

Separate Bills establishing the Australian Renewable Energy Agency and the Clean Energy Finance Corporation will be introduced in coming months.

The government is also announcing a fourth stream of the Low Carbon Communities program. This stream - to be known as the Charities Maritime and Aviation Support Program - will offer a rebate for the carbon price impact on essential maritime and aviation fuels used by organisations such as air and sea rescue services.

These reforms will ensure Australia plays its responsible part in global efforts to tackle climate change. The government’s plan is to cut carbon pollution and drive investment in clean energy technologies.

Around 500 of the country’s biggest polluters will pay for their pollution under the carbon price mechanism and this will create a powerful incentive to reduce pollution in the most economically efficient way. Revenue raised will be used to assist households with the modest cost impacts, to support jobs and the competitiveness of Australian industry, and to invest in clean energy and climate change programs.