The federal government has secured the support it needs to implement its central climate change commitment, after reaching a deal with the Greens following months of safeguard mechanism negotiations.
This policy is the centrepiece of Labor's pledge to reduce carbon emissions by 43 per cent by 2030.
The Greens have long demanded Labor commit to no new coal and gas projects, but the government has repeatedly ruled this out.
Greens leader Adam Bandt said the deal included a hard cap on emissions, which would impact new or expanded high-polluting projects.
He predicted the hard emissions cap would make it unviable for 116 new coal and gas projects in the pipeline because they would be unable to get their emissions below the limit.
"The Greens have stopped about half of them [in the pipeline] but Labor still wants to open the rest," Mr Bandt said.
"And, so, now there is going to be a fight for every new project that the government wants to open."
The safeguard mechanism bill before the parliament seeks to impose emissions limits on the 215 largest-polluting facilities in the country.
It requires those companies to cut, or pay offsets, to reduce their emissions by 4.9 per cent each year to 2030.
Climate Change Minister Chris Bowen has led the safeguard negotiations with the Greens since Labor won power last year.
He said Labor only accepted amendments that were in keeping with Labor's election commitments and policy agenda.
"They do two things, strengthen accountability, transparency and integrity of the scheme and, secondly, provide extra support for those strategic manufacturing industries that are so important for our economy and transition as well," Mr Bowen said.
Extra support for some sectors
The deal will see the government offer extra money to support "Australia's sovereign capability" in the steel, aluminium and cement sectors.
There had been fears that those sectors would be forced offshore without additional support to cut emissions.
Mr Bandt said that, while the negotiations had been in good faith, he was critical of Labor's approach to coal and gas.
"Negotiating with Labor is like negotiating with the political wing of the coal and gas corporations," he said.
"Labor seems more afraid of the coal and gas corporations than the climate collapse."
Prime Minister Anthony Albanese thanked the Greens and the crossbench for engaging constructively in negotiations but took aim at the opposition.
"It says a lot about the state of the Liberal and National parties in 2023 that, in spite of the election result, they have excluded themselves from any participation," he said.
Crossbench senator Jacqui Lambie has been critical of the Greens holding out on agreeing to a safeguard mechanism compromise, urging the party it was better to take something than walking away from a deal.
The Greens' support means Labor now has the numbers to pass the bill through the Senate, allowing it to take force from July 1.
Shadow Climate Change Minister Ted O'Brien said the cap agreed to as part of the deal would hurt Australian industry.
"In order for Australia to decarbonise our economy, we have to get the balance right between cutting emissions and allowing the economy to grow," he said.
"What we see today is a deal between Labor and the Greens that throws that balance out of whack."
But the Business Council of Australia said it was still supportive of the government's policy.
"Additional support for trade-exposed businesses and workers, as well as critical sovereign capabilities, is a crucial step that will help save jobs and ensure Australian businesses are competing on the global stage," BCA chief executive Jennifer Westacott said.
"As designed, the safeguard mechanism and its baseline targets are tough but achievable, so we'll be working with members to assess the full impact of proposed changes."
Mega projects into doubt
The agreement has thrown two major gas projects in the Northern Territory into doubt, according to the Greens and environmentalists.
Gas companies have been wanting to open up hydraulic fracturing in the Beetaloo Basin while gas giant Santos has been seeking to open up the Barossa Gas Field, located off the coast of the NT.
The Nurrdalinji Native Title Aboriginal Corporation, which represents traditional owners of the Beetaloo Basin region, released a statement today expressing optimism the amendments to the Safeguards Mechanism Bill would make it harder for gas companies to get their projects approved.
"Our country is in the hands of these big gas companies and I feel very grateful that we may one day not have to fight to protect our land, sacred sites, culture and water," said the corporation's chair, Johnny Wilson.
"No one has seen the jobs and economic benefits which have long been promised by the fracking companies, and we do not believe they will ever come."
Mr Bowen said the agreement would require "scope one" emissions from the Beetaloo to be offset.
Scope one and two emissions are emissions that are directly controlled or owned by companies, while scope three emissions are emissions not directly controlled by a company.
Mr Bowen said new gas fields would be required to have "zero reservoir carbon" during development.
"That's a condition which is international best practice and has been Australian best practice for many years," Mr Bowen said.
Mr Bandt said the agreement had effectively "derailed" both projects by imposing a limit on carbon emissions that prevented new coal and gas projects from being approved.
The gas industry has long defended its desire to begin commercial gas extraction in the Beetaloo, saying it would create 6,000 jobs and unlock billions of dollars in economic activity.
