The oil and gas industry is pushing to be allowed to buy international offsets to meet its emission reduction requirements under the federal government's new climate change policy.
More than 200 of the nation's largest industrial emitters have pollution limits set by what is known as the safeguard mechanism, a scheme established by the former Coalition government.
The Labor government intends to annually reduce the levels of emissions allowed under the mechanism to ensure Australia hits its national target of a 43-per-cent cut by 2030.
In a submission to government, the Australian Petroleum Production and Exploration Association (APPEA) called for a range of measures to help facilities covered by the mechanism, which includes aluminium smelters, steel manufacturers, LNG production and airlines.
Being able to use both domestic and international offsets, along with being able to trade carbon credits, is a key request from the sector.
"Access to international markets provides an additional option to support emissions reduction projects and compliance options for safeguard facilities," APPEA's submission states.
The updated safeguard mechanism should "provide for appropriate international permits to be included in the range of compliance options, as soon as they are available."
Climate Change and Energy Minister Chris Bowen has previously indicated the use of international carbon credits would only be permitted under strict conditions.
"[It would only be allowed] if the government was 100 per cent guaranteed and satisfied in the integrity of those emissions reductions," he said last month.
APPEA also wants any new facilities that may come under the safeguard mechanism, such as future gas field developments, to be able to use offsets and carbon credit trading.
"[This will] ensure certainty for investment in new gas supply to support Australian and regional energy security," APPEA chief executive Samantha McCulloch said in a statement.
The sector also wants the planned start date of July 1, 2023 to be reconsidered, a reassessment of how much major emitters should be required to cut their greenhouse gas emissions, and pushes for reductions to be based on emissions intensity, not absolute values.
APPEA's submission includes a commitment to the federal government's emissions reduction targets of 43 per cent by 2030 and reaching net zero by 2050.
The major emitters covered by the safeguard mechanism accounted for 28 per cent of Australia's total emissions in 2020-21.
Strengthening the mechanism was a key election commitment from the Albanese government, given the current limits have not compelled emitters to reduce their emissions.
The federal government's consultation paper for the sector sets out options for setting and reducing limits on emissions, as well as ways to support emissions intensive, trade-exposed industries so that they are not put at an international disadvantage by any change.
