Australian Economy

Carbon emissions from Australia’s ‘Dirty Dozen’ more than half Pacific Islands’ emissions

A new Climate Council report has found that between 2016 and 2021, a group of just 12 Australian fossil fuel companies emitted more carbon pollution than 50% of the Pacific Islands’ total emissions over the same period.

The report looked at Australia’s ‘Dirty Dozen’, the twelve biggest fossil fuel polluters regulated by the safeguard mechanism, the policy that requires the largest GHG emitters in the country to keep their emissions below a baseline.

The Climate Council’s ‘Dirty Dozen’ are: Chevron Australia, Woodside Energy, Anglo American, Santos, BHP, Glencore Coal, Inpex, Shell Australia, ConocoPhillips, South32, Esso Australia and Centennial Coal.

Collectively, these twelve companies emitted 287 million tonnes of CO2 equivalent emissions since 2016. Together, they account for more than 40% of the total emissions regulated by the Safeguard Mechanism, which covers 215 companies total.

The Department of Climate Change, Energy, Environment and Water (DCCEEW) is consulting on options to reform the Safeguard Mechanism to help industry reduce its emissions in line with Australia’s climate targets.

The mechanism applies to facilities with scope 1 emissions of more than 100,000 tonnes of CO2 equivalent per year.

As part of the reforms, the Federal Government has proposed gradually reducing baselines to help Australia reach net zero by 2050, introducing credits for facilities that emit less than their baseline, and providing tailored treatment to “emissions-intensive, trade-exposed” facilities so they’re not disadvantaged compared to their international competitors. The Government hopes to initiate these reforms as early as July this year.

But Climate Council says the draft settings released in January need to be strengthened to ensure the biggest emitters don’t derail Australia’s climate commitments.

“Australians are suffering under dangerous climate change, and want more to be done to reduce this harm,” said Dr Jennifer Rayner, head of advocacy at Climate Council.

“Our greenhouse gas emissions need to start plummeting if we are to protect our way of life. The Dirty Dozen have had a free pass to pollute for far too long – it’s well past time they pulled their weight in our shared national effort to cut emissions.”

Climate Council has raised major concerns about the proposed settings. Under the reforms, companies will still be able to purchase and surrender carbon credits to offset up to 100% of their harmful emissions. Climate Council has warned that this will encourage carbon accounting to cover-up harmful polluting business-as-usual.

The organisation has also raised concerns that the pipeline of new coal and gas facilities being planned for Australia will derail Australia’s net-zero goals, forcing huge amounts of additional emissions into the Mechanism.

The organisation has made a series of recommendations to Government to strengthen the Mechanism.

These include requiring facilities to demonstrate practical steps to genuinely reduce emissions before being able to purchase carbon credits, progressively phasing down offsets to a set percentage of a facility’s total baseline following an initial planning period, and requiring any new fossil fuel projects to account for all their emissions without reliance on carbon credits.

“Australia won’t be able to meet our legislated emissions reduction targets and make real progress to tackle harmful climate change if we don’t genuinely cut emissions,” said Dr Rayner. “To do that we should ensure the Dirty Dozen can’t buy carbon offsets to keep on polluting as usual. Nor can we allow any new coal or gas projects.

“If we get the Safeguard Mechanism reform right, it can deliver the biggest cuts to industrial emissions ever seen in Australia.”

Tim Buckley, Director of independent think tank Climate Energy Finance, said emitters who weren’t pulling their weight needed to be identified.

“Credible and ambitious Safeguard Mechanism reform is critical to driving sustained, rapid reductions in scope 1 emissions. It is a central part of the wider Albanese Government’s climate and energy agenda so it’s essential we get this right,” Buckley said.

“It is important to call out the worst contributors to industrial pollution and make sure they start cleaning up their acts. The Dirty Dozen is a timely report, spotlighting the urgent need for sustained emissions reduction action at speed, and identifying the laggards.

“These dozen super-polluters must make tangible, deep progress on reducing emissions and governments and investors alike must hold them accountable for this.”

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