NT Government sets ambitious climate response and offset reform agenda

By Jillian Button
Climate Change Environment, Social, Governance Oil & Gas Resources

In brief 3 min read

The Northern Territory Government's recently released Climate Response, associated Three-Year Action Plan and environmental offset reform agenda is ambitious, and all stakeholders in the Territory should be aware of the coming changes and related opportunities.

Climate Change Response and Three Year Action Plan

There will be significant climate policy development in the coming three years following the release of the Climate Change Response and Three Year Action Plan. In particular:

  • Net zero by 2050 – the Territory Government has confirmed a goal of achieving net zero emissions by 2050.
  • Large emitters policy – a policy outlining the Territory Government’s expectations for the mitigation and management of emissions from new and expanding large greenhouse gas emitters is targeted for the end of 2020.
  • Emissions Reduction Strategy – the development of an Emissions Reduction Strategy (ERS) by mid-2022. The ERS will identify stages, interim targets, timeframes, and potential approaches and mechanisms to achieve the net zero emissions target by 2050.
  • Greenhouse Gas Emissions Offsets Policy - develop a Greenhouse Gas Emissions Offsets Policy to guide the application and administration of carbon offsets by mid-2022.
  • No net increase in the lifecycle emissions emitted in Australia from any onshore shale gas – confirmation of a commitment to Recommendation 9.8 of the ‘Independent Scientific Inquiry into Hydraulic Fracturing in the Northern Territory’ to ensure there is no net increase in the lifecycle emissions emitted in Australia from any onshore shale gas produced in the NT.
  • Electricity market reforms - implement reforms to the Territory Electricity Market to improve financial transparency, provide cost reflective ancillary services, quality and efficient service delivery and reduce costs by the end of 2021.
  • Hydrogen Strategy – the Territory's Hydrogen Strategy to play a central role in achieving its 2050 target. The strategy is available here.

Environmental Offset Reform

As we reported, the recently commenced NT EP Act established a legal mechanism for an environmental offset framework in the Territory. The Northern Territory Offsets Principles have been released:

  • Biodiversity and Greenhouse Gas Offsets – the new offsets framework will be underpinned by two key policies: a Biodiversity Offsets Policy and a Greenhouse Gas Offsets Policy, both of which are still being developed.
  • Target-based implementation model – the Territory Government proposes to create and implement outcome-based targets to underpin its environmental offset strategy, rather than the conventional 'no net loss' environmental offset model. The ability to make payments into an offset fund is unlikely to be a feature of the new model.
  • Preconditions to offsets – the Offset Principles make clear that there is an expectation the mitigation hierarchy must be rigorously applied; and that offsets will not always be available or appropriate.

Steps you should take now

  • Operators and new entrants in the Northern Territory should begin factoring into their project planning and decision-making the coming policy responses to the net zero climate change target and offset requirements.
  • Further, the policy responses also open up new growth opportunities for which planning can begin now.
  • Large emitters should also turn their mind to successful mitigation and management methods that could be incorporated into the coming Government policy and Emissions Reduction Strategy. Industry-led options are often the most successful in achieving policy outcomes which facilitate growth for industry.