New law on climate change for Victoria

20 December 2016

The Victorian Government recently introduced the Climate Change Bill 2016 (Bill) into Parliament following an independent review of the current Climate Change Act 2010 (Act).

The Bill seeks to repeal the Climate Change Act 2010 (Act) and replace it with an enhanced legislative framework in order to more effectively address climate change in Victoria. If enacted, the Bill will set a long-term carbon emissions target for Victoria of net zero emissions by 2050 and give the Victorian Environment Protection Authority (EPA) enhanced powers to regulate carbon emissions to achieve Victoria’s targets.

Review of the current Climate change act

In 2015, the Victorian Government commissioned an independent review (Review) of the Act, which resulted in a series of recommendations for legislative change to improve the operation of the Act and support Victoria in responding to climate change. The Government accepted the vast majority of the recommendations, which are now implemented through the Bill.

On 22 November 2016, the Bill was introduced into Parliament by the Victorian Minister for Energy, Environment and Climate Change. The Bill was passed by the Legislative Assembly on 8 December 2016 and is expected to be introduced into the Legislative Council in early 2017.

Net zero emissions target

An important provision of the Bill is the introduction of a long-term carbon emissions reduction target for Victoria of net zero greenhouse gas emissions by 2050. As a result of the previous Government’s repeal of Victoria’s emissions reduction target in 2012, Victoria does not currently have a legislated emissions reduction target.

The ‘net zero by 2050’ target is in line with Australia’s international commitments. In December 2015, Australia was one of 195 countries to adopt the Paris Agreement under the United Nations Framework Convention on Climate Change (UNFCCC). The Paris Agreement includes the agreement to hold the global average temperature to well below 2 degrees Celsius above pre-industrial levels, and to pursue efforts to limit the increase to 1.5 degrees. In order to achieve this, global emissions need to decline to net zero levels by the second half of the century. The Bill also provides for the setting of 5-yearly interim emissions reduction targets, again in line with the Paris Agreement commitments.

In effect, the adoption of the ‘net zero by 2050’ target will require Victoria to reduce its emissions as much as possible by 2050 and then maximise the removal of greenhouse gases from the atmosphere through sequestration activities in Victoria. If the amount of sequestration does not balance out the amount of emissions, then offsets can be secured from outside Victoria.

EPA powers

Another significant issue addressed by the Bill is the clarification of the EPA’s powers to regulate greenhouse gases. The Bill introduces a new section into the Environment Protection Act 1970 (EP Act) which enables the EPA to make recommendations to the Governor in Council regarding statutory policies and regulations to monitor the emission of greenhouse gas substances for the specific purpose of contributing to Victoria’s long term and interim emissions reduction targets.

Currently, the EPA has power to regulate greenhouse gases primarily under the State Environment Protection Policy (Air Quality Management) (SEPP). However, the Review found that the SEPP provisions limited the EPA’s capacity to bring about significant reductions in emissions. The Bill clarifies that the EPA can act to address climate change to achieve Victoria’s emission targets.

The Bill retains the obligation under the Act for the EPA to consider climate change as part of its routine decision making. For example, the EPA must have regard to the potential climate change impacts and contribution to greenhouse gas emissions which may result from the issuing of works approvals, licencing of scheduled premises, recommendations on state environment protection policies and waste management policies.

Other changes

The Bill sets out a number of other changes to the Act to achieve carbon emission reductions and reach Victoria’s short and long-term targets, including:

  • The introduction of a 5-yearly Climate Change Strategy which details how Victoria will meet its targets and adapt to the impacts of climate change;
  • The establishment of a periodic reporting system to ensure transparency and accountability;
  • The introduction of 5-yearly Adaptation Action Plans that focus on key areas, such as health and human services, transport, water cycle and the natural environment; and
  • The development of a whole-of-government and individual sector pledging system to reduce emissions from across the economy and government.

The Bill seeks to provide Victoria with a comprehensive framework to manage and address the risks of climate change and to facilitate the reduction of greenhouse gas emissions by Victorian communities, businesses and government.

Implications for business
  • The introduction of the Bill further demonstrates the desire of the Andrews’ Government to put climate change back on the agenda in Victoria;
  • The ‘net zero emissions by 2050’ target will impact on government operations through the whole-of-government and individual sector pledging system; and
  • We expect to see the EPA playing a greater role in greenhouse gas emission reductions, especially in its works approvals and licensing roles.

The article was written by Meredith Gibbs, Partner and Rani Donohue, Trainee Solicitor.

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