DCCEEW Safeguard Mechanism Review Has Commenced
DCCEEW has commenced stakeholder consultation for the 2026–27 review of the Safeguard Mechanism. The review will consider whether the current scheme settings remain appropriately calibrated and continue to support Australia’s emissions reduction targets. Written submissions are due by 11:59pm AEST, Friday 18 September 2026.
Key areas being considered:
1. Baseline decline rates after 2030
The review will consider the appropriate baseline decline rate for 2030–31 to 2034–35.
Currently, Safeguard Mechanism baselines generally decline by 4.9% each year to 2030. The post-2030 settings will therefore be an important consideration for facilities planning their longer-term emissions reduction strategies.
2. On-site emissions reduction
The review will consider whether the Safeguard Mechanism is providing sufficient incentives for facilities to undertake on-site abatement, and whether additional incentives may be required.
The Climate Change Authority will provide advice to Government on the extent to which the reforms are driving on-site abatement and whether further incentives are appropriate.
3. Offsets and Safeguard Mechanism Credits
DCCEEW will consider the future role of Safeguard Mechanism Credits (SMCs), ACCUs and international units, including their role in meeting compliance obligations beyond 2030.
4. Trade-exposed facilities and carbon leakage
The review will also consider whether the current arrangements for trade-exposed facilities remain appropriate.
It will take into account the recommendations of the Government's Carbon Leakage Review, which considered the risk that emissions-intensive activities could move offshore as Australia reduces emissions.
What this means for your business
For Safeguard-covered facilities, this review provides an opportunity to consider how potential changes to post-2030 baselines, abatement incentives and compliance mechanisms could affect your long-term emissions strategy and investment decisions.
Businesses may also wish to review their current emissions trajectory and identify opportunities for on-site abatement ahead of the post-2030 settings being finalised.
DCCEEW is currently accepting stakeholder submissions, with consultation closing 18 September 2026. Policy positions and any draft rule amendments are expected to be released in early 2027.
Need assistance with your Safeguard Mechanism requirements?
Greenbase works with companies to support NGER and Safeguard Mechanism reporting, emissions calculations, baseline assessments and emissions reduction strategies.
If you'd like to discuss how the Safeguard Mechanism review could affect your facility, get in touch with our team.
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