Last month, the Australian government lodged an updated Nationally Determined Contribution (NDC) with the United Nations Framework Convention on Climate Change (UNFCCC) secretariat in relation to Australia’s obligations pursuant to Article 4 of the Paris Agreement.[1]

Among other things, the updated NDC:

  • commits Australia to an ambitious greenhouse gas emissions reduction target of 43% below 2005 levels by 2030 (which covers all sectors and gases included in Australia’s national inventory);
  • reaffirms Australia’s commitment to net zero emissions by 2050;
  • commits the government to providing an annual statement to parliament on progress towards the above targets; and
  • returns Australia’s Climate Change Authority as a source of independent policy advice.[2]

Within the NDC, the government advised that it:

  • is implementing a “substantial and rigorous suite of new policies across the economy to drive the transition to net zero”;[3]
  • will introduce a new annual statement to Parliament on climate policy, progress against national targets and international developments; and
  • aims to formalise its targets in legislation.[4]

What happened today?

The introduction of the Climate Change Bill 2022 (Climate Change Bill) and the Climate Change (Consequential Amendments) Bill 2022 (Climate Change Amendments Bill) in federal parliament today is the next step in the government seeking to meet the ambitions of the NDC and achieving the government’s climate change policy.

While these legislative instruments have been anticipated since the outcome of the Federal election in May, the scope of the Climate Change Bill appears to have undergone some eleventh hour changes prior to being tabled in an effort to garner support from The Australian Greens and various independent members of parliament based on their pre-election platforms. The changes:

  • make it clear that the 43% greenhouse gas emission reduction target is a minimum only (and not a ceiling) which could be upgraded over time; and
  • ensure the legislation achieves more than a symbolic annual reporting exercise to parliament.[5]

If it passes, the legislated greenhouse gas emission reduction target is likely to have far reaching consequences for the future direction of policy, decision making, climate change litigation, project type and project evaluation and delivery in Australia.

Future changes in the climate change and environmental regulatory areas are certain and it is a critically important space to watch.

What is being proposed?

The Climate Change Bill:

  • Enshrines Australia’s greenhouse gas emissions reduction targets (43% reduction from 2005 levels by 2030 and net zero emissions by 2050) to limit temperature increase by 1.5 to 2°C in line with the Paris Agreement. The 2030 target seeks to be a point target and an emissions budget covering 2021 to 2030 and any new NDC target must be more ambitious, to prevent ‘backsliding’.
  • The Minister for Climate Change and Energy (Minister) must prepare an annual climate change report and table the report in each House of the Parliament. The annual statement is to cover Australia’s progress towards achieving its targets, relevant international developments, climate change policy, and the effectiveness of the government’s climate change policies in contributing to the reduction of greenhouse gas emission targets.
  • The Climate Change Authority furnish the Minister with independent advice that relates to the preparation of annual climate change statements and greenhouse gas emission reduction targets to be included in new or adjusted NDC’s at least once every five years.
  • Mandatory periodic independent reviews of how the Climate Change Bill is operating.

Transparency and accountability are fundamental aspects of the Climate Change Bill, so that:

  • while public consultation is not mandatory when preparing the annual climate change statement, if advice is requested in relation to the NDCs, public consultation is mandatory
  • public consultation is required when the Climate Change Bill is assented to and the Climate Change Act 2022 is reviewed
  • the Minister must provide clear reasons and table them in Parliament if they fail to follow the independent advice of the Climate Change Authority
  • when advising the Minister on both the annual statement and the NDC targets, the Climate Change Authority must publish a copy of the advice provided to its website.

The Climate Change Amendments Bill seeks to embed considerations relating to the emissions reduction targets and Paris Agreement into the objectives and/or functions of key agencies and government departments delivering programs and policies contributing to emissions reduction.

What does this mean for “tomorrow”?

If the Climate Change Bill and the Climate Change Amendments Bill secure Senate support and are ultimately passed, the effect of the legislation will be far reaching.

As we have seen from the overseas (and domestic) experience, a legislated target:

  • was found to create a duty of care to citizens in respect of climate mitigation to reduce greenhouse gas emissions on human rights grounds[6]
  • can be used as a tool by third parties who may seek to make governments and decision makers accountable in the implementation of policies and the undertaking of their functions in a way so as to achieve the emission reduction targets[7]
  • may found an argument that the failure of the government to achieve the target is a violation of fundamental human rights[8]
  • is open to challenge in circumstances where it fails to quantitatively identify the contributions expected to be made by policies to reduce greenhouse gas emissions[9]
  • was found to be insufficient due to incompatibility with fundamental human rights enshrined in the national Constitution[10]
  • is likely to drive a shift in litigation brought by parties effected by the energy transition.

What’s next?

From here, the Climate Change Bill and the Climate Change Amendments Bill have been referred for a second reading speech. No proposed amendments have been circulated.

What else is happening?

The Climate Change Bill and the Climate Change Amendments Bill come at a time and in the context of the government:

  • having made a commitment during the election process to establish an independent environmental protection agency to enforce national environmental laws
  • recently releasing the Australia State of the Environment 2021 report[11], which presents a deteriorating general outlook for the Australian environment
  • committing,[12] by the end of this year, to providing a formal response to the 2020 independent review of the Environment Protection and Biodiversity Conservation Act 1999 (Cth) – which recommended fundamental, substantial and necessary reform of the national environmental legislation.

It is certain that change in the climate change and environmental regulatory areas is in our future.

More changes are certain to come.