Trade with no cap
The Australia Institute made a submission on draft legislation that would establish a new kind of carbon credit in Australia. The proposed Safeguard Mechanism legislation fails to clarify how new entrants will be managed and does not address integrity and additionality concerns around offsetting units.
Expected emissions from new gas and coal projects could overwhelm any abatement from the Safeguard Mechanism. Just two gas projects and the 22 coal projects currently seeking EPBC approval intend to emit almost 120 million tonnes of carbon pollution to 2030, compared to the estimated abatement of the Safeguard Mechanism of 170 million tonnes.
The proposed legislation should not be introduced or further developed until the independent review into the integrity of carbon credits is finalised and previous consultation on the Safeguard Mechanism has been responded to.