Australia passes emissions reduction plan after deal with Greens Party

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Australia passes emissions reduction plan after deal with Greens Party

Steam billows from the cooling towers of Great Energy Alliance Corp.'s Loy Yang coal-fired power station in Latrobe Valley, Australia, on September 7, 2011. A PHOTO BLOOMBERG SYDNEY - Australia's lower house has passed a emissions reduction plan with curbs on new gas and coal investments and a cap on greenhouse gas emissions from the country's biggest polluters after a deal with the Greens Party.

The Safeguard Mechanism reform legislation is one of the key elements of the Labor government's pledge to reduce emissions by 43 percent by 2030 in a country that ranks as one of the world's biggest carbon emitters per capita.

Weeks of talks with the Greens Party, which is needed in the upper house Senate, resulted in changes including a hard total emissions cap, ministerial review for projects that raise total emissions and mandatory disclosures for polluters that rely heavily on carbon offsets to meet their targets.

The law requires all new gas projects in the Beetaloo Basin to have net zero carbon emissions and new gas fields to supply existing natural gas LNG plants to have net zero reservoir emissions, imposing new costs.

ALSO READ: Govt report: Australia not on track to meet emissions target.

Chris Bowen, Energy Minister, said we are a step closer to reaching net zero by the year 2050.

Support from the Greens, who originally wanted to ban all new fossil fuel projects, leaves the government short two votes in the Senate, where it is wooing independents.

The plan is due to take effect on July 1, and aims to make about 215 oil, gas, mining and manufacturing facilities emit more than 100,000 tonnes of CO 2 - equivalent over the next seven years.

In Woodside's shares fell 2.3 percent, while Tamboran Resources, which is looking to develop a project in the Beetaloo, fell 6.7 percent in a broader market that was up 0.2 percent.

The government said it would tip in A $400 million $266 million to help the cement, steel and aluminium industries decarbonize.