Carbon review seeks competition
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A government inquiry is looking at ways to keep heavy industries competitive in a net zero world.
The federal government has unveiled the second consultation paper in its Carbon Leakage Review, led by Professor Frank Jotzo from the Australian National University.
The government says it is “committed to strengthening the competitiveness of Australian industry” while maintaining environmental goals.
The review is looking at ways for Australia’s heavy industries - such as mining, steel, and cement - to remain competitive on the world stage without compromising on climate targets.
The review, launched following reforms to the Safeguard Mechanism in 2023, is exploring ways to secure a “level playing field” in a global economy increasingly shaped by carbon-conscious policies.
The Safeguard Mechanism, introduced last year, requires major industrial emitters to keep their emissions within set limits or pay penalties. It has become a core part of Australia’s climate policy.
But authorities say they want to address “carbon leakage” - when companies move operations to countries with looser environmental policies, undermining both local economies and global climate action.
The review’s goal is to prevent this from happening by keeping domestic industries competitive as the world shifts to net zero.
This may include measures like border carbon adjustments (BCAs), subsidies for low-carbon tech, carbon contracts, free emissions permits, carbon offsetting, and international cooperation to keep domestic industries competitive without sacrificing climate goals.
The review invites feedback from a broad range of voices: businesses, environmental groups, researchers, international partners, and even the average Australian with an opinion on the topic.
Its public feedback period runs until 3 December 2024.
More details are accessible here.
