Tony Abbott’s Direct Action plan to address climate change will see big businesses competing for funds to help reduce their carbon footprint.
The bill was approved by the Senate late last night with a little help from Clive Palmer. It aims to reduce greenhouse gas emissions by 5% of 2000 levels by 2020.
Abbott and Environment Minister Greg Hunt’s Direct Action plan will establish a $2.55 billion emissions reduction fund, an incentive program for companies to find low-cost ways to reduce their carbon footprint.
Critics say companies should be leading the way on emission reductions independently. “There won’t be a problem of spending the money,” Frank Jotzo, a senior lecturer at the Australian National University, told Fairfax. “The concern is you won’t get value for money,” because it will never be clear that a company would have reduced its footprint without the cash incentive.
The government will select the most cost-effective projects and pay them until they achieve their reduction goals or the funds have been depleted.
Applicants with a potential offsets project can apply to the clean energy regulator to register their project as part of the emissions reduction fund, which will then be assessed and registered.
The regulator will issue successful projects Australian carbon credit units (ACCU) at a rate of one ACCU for each tonne of abatement achieved. The crediting period will range from seven years for most methods, to 25 years for sequestration projects.
Businesses also have the option of proceeding directly to crediting stream without participating in the auction process.
The government says the emissions reduction fund will operate alongside existing programs such as the renewable energy target and energy efficiency standards on appliances, equipment and buildings.
As part of its deal with the Palmer United Party, plans to eliminate the Climate Change Authority were abandoned and the advisory body has been tasked with exploring an emissions trading scheme that would only come into effect when Australia’s trading partners implement a similar strategy.
Independent senator Nick Xenophon also had a hand in shaping the new program, implementing protocols which establish baselines that emitters cannot exceed, however, these “safeguards” won’t come into effect until 2016.
Greens leader Christine Milne labelled the government’s emissions trading scheme has been “a sham and a shonk”.
“The big polluters can now put out their hand for taxpayers dollars in order to be paid to do something they should have been doing anyway,” she said.
Labor Senator and environment spokesperson Lisa Singh said the plan was “a program built on begging big polluters not to pollute” and both Labor and the Greens raised concerns Clive Palmer’s businesses may benefit from receiving grants as a result of the new policy.
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