MELBOURNE (Reuters) - Australia’s conservative government on Tuesday agreed to push forward legislation that would allow carbon capture and storage projects to be backed by its Climate Solutions Fund and provide credits to big polluters that cut their emissions intensity.
The move came in response to a report on new ways the government’s A$2 billion ($1.3 billion) Climate Solutions Fund could be used to curb emissions because the country remains well short of its 2030 Paris Climate Accord target.
Australia needs to cut its annual emissions to 462 million tonnes of carbon dioxide equivalent (Mt CO2-e) to meet its Paris Climate Accord target of reducing its emissions by at least 26% from 2005 levels by 2030.
Australia’s emissions are expected, however, to fall to 511 Mt CO2-3 in 2030 from 534 Mt CO2-e in 2020, according to government forecasts in December.
The government’s first carbon abatement fund, the Emissions Reduction Fund set up in 2014, committed A$2.2 billion for 190 million tonnes of emissions reductions, mostly through forest plantation and landfill gas capture projects.
The A$2 billion Climate Solutions Fund was announced last year.
“The Government will target dollar-for-dollar co-investment from the private sector and other levels of government to drive at least A$4 billion of investment that will reduce emissions across Australia,” Energy and Emissions Reduction Minister Angus Taylor said in a statement.
The panel producing the report recommended carbon capture and storage projects be eligible for funding and that carbon credits be given to big polluters who sharply cut their emissions intensity.
The government said on Tuesday it agreed with the recommendations.
Green groups, including Greenpeace and the Australian Centre for Corporate Responsibility, criticized the plans, saying the government would be paving the way to subsidise oil and gas producers and coal- and gas-fired power plants.
($1 = 1.5260 Australian dollars)
Reporting by Sonali Paul; Editing by Tom Hogue