Australia scraps Climate Active carbon neutral certification: what it means for offset markets and industrial emissions policy

The Australian government has announced it will scrap the Climate Active program, a voluntary certification scheme that allowed companies to label products and operations as carbon neutral by purchasing offsets. The Climate Council, a community-funded climate advocacy group, welcomed the move, arguing the scheme let major polluters like coal and gas companies claim green credentials without cutting emissions at the source. More than 100 companies had already withdrawn from Climate Active in recent years amid growing concerns about offset integrity. The Climate Council is now calling on the Albanese government to strengthen the Safeguard Mechanism, Australia's main industrial emissions policy, to require actual pollution cuts from the country's largest emitters rather than allowing them to pay for offsets as a substitute. The end of Climate Active marks a significant shift in Australian climate policy, signaling that offset-based claims are no longer sufficient. For carbon market participants, this raises questions about the future of voluntary offset demand in Australia and the role of offsets in meeting national climate targets.