The government’s Direct Action climate policy will not include punishments for companies which fail to meet carbon emission targets.
Federal Environment Minister Greg Hunt has told The Australian that the scheme was not designed to be punitive. And there is no intention to raise revenue from companies who don’t meet their targets.
Hunt said that the government has not yet finalised how best the scheme might work in its full form. However he said it is possible that the $1.5 billion Emissions Reduction Fund may require companies to buy carbon credits as an offset.
Also, companies may be given a multi-year compliance period. This means they could exceed baseline emissions in one year, as long as they maintain average emissions in a set compliance period.
Before Christmas, the government released a green paper for public comment. After February a white paper outlining the final design of the Emissions Reduction Fund will be released.
“Consistent with this intention, in the event that an entity did exceed its baseline, there would be flexible compliance arrangements available,” the green paper says.
“One approach that could be considered would be to set an initial transition period during which compliance action for exceeding baselines would not apply.
“This would enable businesses to make investments in emissions-reduction projects, potentially with support from the Emissions Reduction Fund.”
As the AFR reports, the government’s policy has been dismissed by both the Labor Party and the Greens. Both parties claim the policy will not see Australia meet its commitment to reduce CO2 emissions by five per cent below 2000 levels by 2020.
Acting shadow minister for climate change Tony Burke told AFR, “Before the election, Tony Abbott claimed his direct action policy would reduce Australia’s emissions. This paper shows that it will allow the exact opposite to happen,”
And Acting Greens Senate leader Richard Di Natale said of the scheme, “Just weeks ago, Tony Abbott declared an end to corporate subsidies. What does the Prime Minister call his Direct Action plan that will pay the big polluters to supposedly reduce their emissions, with the taxpayer left to foot the bill?”