“A revamped safeguard mechanism will help Australian industry cut emissions and remain competitive in a decarbonising global economy,” Bowen said.
The safeguard mechanism,established under the former Coalition government in 2016,applies to industrial facilities that generate more than 100,000 tonnes of greenhouse gases a year,such as coal mine sites,gas plants,aluminium smelters and cement producers. While the government-approved baseline emission limits are intended to be progressively lowered,the limits on polluters to date have been so slight that industrial emissions have actually increased since the mechanism was introduced.
The Albanese government will begin extensive industry consultations across the country on Thursday to seek feedback on how the mechanism should be designed.
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Among the key areas of consultation will be setting “baselines” for new and existing facilities and determining indicative rates for baseline reductions.
While the consultation paper states that final decline rates would not be settled until other policy settings had been finalised,it said indicative decline rates were expected to be “between 3.5 and 6 per cent each year”.
It will also seek to identify “tailored treatment” options to ensure emissions-intensive trade-exposed industries were not disadvantaged. One approach could be to provide taxpayer-funded grants for trade-exposed businesses to shift to low-emissions technologies instead of providing concessions within the safeguard system,it said.