Chris Bowen to use special emissions powers against Greens

Chris Bowen will use ministerial powers to ensure Labor’s crackdown on the biggest-emitting facilities starts on July 1.

Federal Energy Minister Chris Bowen. Picture: NCA NewsWire / Dan Peled

Climate Change and Energy Minister Chris Bowen will use special ministerial powers to ensure Labor’s crackdown on the nation’s biggest-emitting facilities starts on July 1, as the Albanese government scrambles to avoid having its signature climate policy gutted by the Greens and crossbenchers.

Mr Bowen is under pressure to push through legislation establishing new safeguard mechanism credits that underpin the scheme and help companies slash emissions by nearly 5 per cent each year out to 2030.

Mr Bowen – who has 13 parliamentary sitting days over the next four weeks to lock in support for the SMCs – is expected to stare down threats to sabotage the legislation and will issue the scheme’s final rules in April via ministerial regulation.

The new rules – forcing Australia’s 215 biggest-emitting facilities to cut emissions faster - could be overturned in an unlikely scenario where the Greens, Coalition and crossbenchers team up in the Senate to support a disallowance motion.

The new carbon credits are considered critical design features by commonwealth officials and private sector representatives. Some companies are concerned that not having access to a more flexible carbon trading market could mean heavy emitting and trade-exposed companies face serious challenges in achieving baseline targets. Industry groups are already frustrated by the government’s decision to ban international carbon offsets, which they fear will spark a shortage of domestic offsets.

While the Greens and independent ACT senator David Pocock have publicly attacked Anthony Albanese’s signature climate policy, which underpins Labor’s 2030 target to reduce emissions by 43 per cent, privately they are attempting to broker deals with Mr Bowen.

Mr Bowen will continue negotiations with Greens leader Adam Bandt and Senator Pocock early next week. The Senate standing committee on environment on Monday will release its final report, following a three-month inquiry into the safeguard mech­anism carbon credits legislation.

With the Coalition opposed to the tougher safeguard mechanism, the Prime Minister needs the Greens’ 11 senators plus two crossbenchers to get legislation through the Senate.

Senior business sources said there was “real risk” of the compact between the government and private sector breaking if the mechanism was made unworkable. Mr Bowen is being urged to hold the line and not offer any major concessions to the Greens.

The Australian understands a “red line” for companies who have worked closely with the government is any move to lift the proposed carbon price ceiling above $75 a tonne.

Ahead of parliament returning and skirmishes resuming over climate change, the voice referendum, the $15bn National Reconstruction Fund and the $10bn Housing Australia Future Fund, former deputy prime minister Barnaby Joyce said the government must release its “secret economic and jobs modelling” assessing net zero transition impacts on regional communities.

In October last year, The Australian revealed closure of coal-fired power stations and associated coalmines would wreak havoc on regional economies, with unreleased government analysis showing the unemployment rate in the NSW Upper Hunter region could increase by 6.7 percentage points and impact almost 800 jobs.

The government modelling, which has not been publicly released, warned about “significant” impacts of sudden shutdowns of the Liddell and Bayswater coal-fired power stations, with total income loss in the Upper Hunter estimated to be at least $33m.

Responding to questions from Mr Joyce about which regions had been modelled and projected impacts on jobs and incomes, Resources Minister Madeleine King said her “department regularly undertakes a range of data and trend analyses on industry and works closely with other departments on this information”.

Mr Joyce said the Albanese government was “needlessly prolonging and fanning the so-called ‘climate wars’ by refusing to release job and economic modelling it ­secretly conducted … on coal-rich communities throughout ­Australia”.

He said the Nationals and Liberals would “struggle to take climate activists seriously” if they failed to pressure the government to release its economic modelling.