Australia Safeguard Mechanism criticized as state-sponsored greenwashing over carbon offset reliance

A new report from the Australia Institute argues that Australia's Safeguard Mechanism, the country's flagship climate policy for industrial emitters, is failing to cut actual greenhouse gas emissions. The policy allows unlimited use of carbon offsets, and critics say major polluters are using cheap, flawed credits instead of reducing their own pollution. The report points to examples like Shell's Prelude gas facility earning over $90 million in carbon credits while increasing its total emissions. The scheme covers about 200 of Australia's largest industrial facilities, responsible for roughly 30% of national emissions. While the government highlights net emission reductions, the report says these rely heavily on offsets that do not represent real decarbonization. Crossbench MPs and the Australia Institute are calling for tighter rules on offset use and stronger requirements for actual emission cuts when the government reviews the policy.