Final Safeguard Mechanism reforms set to commence: outlining the impact on covered facilities

A key element of the Federal Government's strategy to achieve net zero carbon emissions by 2050 has been enacted, primarily via the passing of the Safeguard Mechanism (Crediting) Amendment Act 2023 (Cth) (Amending Act) on 30 March 2023, and by amendments to the National Greenhouse and Energy Reporting (Safeguard Mechanism) Rule 2015 (Cth) (Safeguard Rules) which were made on 5 May 2023. The amendments to the Safeguard Mechanism will commence on 1 July 2023.

The Safeguard Mechanism amendments principally reflect the Government's Position Paper and exposure draft amendments released on 10 January 2023. However, the final version contains a number of key changes.

In this article we discuss the principal differences between the final Safeguard Mechanism amendments and what was proposed in the earlier Position Paper and exposure draft reforms (discussed in our previous article).