Penny Wong (SA, Australian Labor Party, Minister for Climate Change and Water) Share this | Hansard source

As I understand the advice to me, under the risk assignment agreements, with anything in excess of three per cent of a component of reduction that is considered to be new knowledge, the Commonwealth bears the risk. In relation to climate change, all users bear the risk. Our concern about Senator Nash’s amendment is that, potentially, it risks leading to a situation where climate change could be regarded as new knowledge. We do not believe that is appropriate. There will be a discussion about what aspects of any reduction are due to new knowledge or climate change. We need to have that discussion under a clear legislative framework, and in the context of the authority being able to give a very clear indication of where it believes various reductions should appropriately be assigned.

Our concern with Senator Nash’s amendment is that it has the potential to muddy the distinction between new knowledge and climate change. The Commonwealth’s view is that this amendment bill in fact clarifies that they are distinct issues, recognising and not prejudicing the fact that there is still going to have to be consideration by the authority and therefore by governments and users about what components are carried by which entities, users or the Commonwealth, in the context of any reduction.

And I would make the point that, in fact, the Commonwealth has gone further than the previous Commonwealth government in that, as part of the IGA negotiations, my recollection is that we took on the 100 per cent above a first three per cent of new knowledge risk.