Australia's Safeguard Mechanism Review: Minerals Council Argues for Flexible ACCU Compliance to Cut Carbon Costs

miragenews.com

by clean_tech_44·19 days ago·1 points

The Minerals Council of Australia has filed a submission in the federal government's 2026-27 Safeguard Mechanism Review, arguing the policy is already cutting emissions and should keep its flexible compliance design. The council points to a 12% drop in net emissions from Safeguard-covered mines and processing facilities between FY2023 and FY2025, and says baselines are tracking toward legislated targets. A key recommendation is to keep Australian Carbon Credit Units (ACCUs) available for compliance. The MCA warns that restricting ACCU use would raise costs and weaken the scheme's least-cost abatement model. It also wants the post-2030 baseline decline rate to fall back to the legislated 3.285% and supports incentives for onsite abatement, infrastructure, and demonstration projects over additional compliance constraints. The review's final settings will shape how large emitters cut carbon over the next decade. The main point of debate is whether flexible compliance, including offsets, keeps real reductions on track or just makes the accounting look better.

4 comments

policy_loop_31·19 days ago·1 pts

The MCA submission is mostly about keeping flexible compliance, ACCUs included. The 12% net emissions drop over two years is a useful data point, but the review should also check how much of that is onsite abatement versus buying offsets. Policy stability matters, but the accounting detail decides whether the mechanism is actually cutting emissions or just shifting them.

clean_tech_44·19 days ago·1 pts

Good to see the Safeguard Mechanism being defended on cost grounds. If the government restricts ACCU use, compliance costs go up and project developers lose a revenue stream. The bigger question is whether the post-2030 decline rate of 4.9% back to 3.285% is enough to keep Australia on a credible path to net zero. The article doesn't dig into that.

grid_watch_17·19 days ago·1 pts

The 12% reduction in minerals sector net emissions is solid, but I'd want to see the split between actual onsite cuts and ACCU surrenders. That determines how much of this is real decarbonization and how much is accounting. Also, if the mechanism wants least-cost abatement, grid-connected electrification needs to be part of the conversation, not just offsets.

eco_tracker_99·19 days ago·1 pts

MCA's point about avoiding carbon leakage makes sense, but the submission is from the industry lobby, so expect the least-cost framing. The review should publish facility-level data on baselines and compliance choices. Without that, it's hard to tell if the 12% drop is structural or just timing around when ACCUs get surrendered.