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2019 - 2020 - 2021
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
Liability for Climate Change Damage (Make the Polluters Pay) Bill 2021
EXPLANATORY MEMORANDUM
and
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
Circulated by authority of
Adam Bandt MP
Liability for Climate Change Damage (Make the Polluters Pay) Bill 2021
OUTLINE
This Bill makes fossil fuel companies liable for climate change damage, giving victims of
climate change, such as the 2019 - 2020 bushfire survivors, the right to bring an action
against thermal coal, oil and gas companies for climate change damage.
Major emitters of greenhouse gases, including fossil fuel producers and owners or
operators of coal-fired power stations, will be liable for climate change damage if their
emissions are greater than 1 million tonnes in any 12 month period that began on or after
1 September 2020. The first Intergovernmental Panel on Climate Change report was
released in that year, unambiguously linking fossil fuels to global warming. From at least
this time onwards, every fossil fuel corporation has known, or should have known, about
the consequences of their actions. For corporations that actively knew about the
consequences of their actions earlier, liability will attach from that earlier date.
A person who suffered climate change damage, the Attorney-General of the
Commonwealth, or of a State or Territory, can bring an action against a major emitter. The
Federal Court of Australia will have the ability to:
Grant an injunction requiring the major emitter to reduce or cease activities that may
cause climate change damage in the future; and
Determine the amount of damages the major emitter is liable for. When deciding,
the court may assume the major emitter's share of the climate change damage is at
least the same as their share of total global greenhouse gas emissions.
FINANCIAL IMPACT
The bill will have no financial impact.
NOTES ON CLAUSES
Clause 1: Short Title
This clause provides for the Ace to be cited as the Liability for Climate Change Damage
(Make the Polluters Pay) Act 2021.
Clause 2: Commencement
This clause states the whole of the Act will commence the day after it receives the Royal
Assent.
Clause 3: Simplified outline of this Act
This clause provides a simplified outline of this Act. The bill will provide people who have
suffered climate change damage the right to recover damages from major emitters of
climate greenhouse gases, including fossil fuel producers and the owners or operators of
coal-fired power stations. The share of climate change damage for which a major emitter is
liable, is at least the same proportion of their greenhouse gas emissions to total global
greenhouse gas emissions.
Clause 4: Definitions
This clause defines terms used in the Act, some of which have the same meaning as other
Act while others are newly defined.
Climate change means a change of climate which is attributed directly or indirectly to
human activity that alters the composition of the global atmosphere and which is in
addition to natural climate variability observed over comparable time periods.
Climate change damage means any damage arising in Australia from climate change,
including, but not limited to:
a) Economic loss or physical loss of property, infrastructure, structures, resources or
other assets;
b) The costs associated with obtaining and maintaining insurance reasonably required
due to the risk of the losses referred to in paragraph a);
c) Death, inquiry, illness or other physical or psychological harms and the costs
associated with treating or caring for persons suffering from them;
d) Damage related to ocean acidification;
e) Loss of land or damage to infrastructure due to rising sea levels, including slow-
onset loss;
f) The costs of monitoring, researching and analysis the climate and the weather if the
costs are reasonably incurred to provide information about the effects of climate
change and appropriate adaption measures;
g) The costs of responding to emergencies arising from natural disasters associated
with climate change;
h) The costs of constructing, renovating, repairing or improving infrastructure in order
to minimise further such damage and costs;
i) The costs of carrying out public education campaigns to inform the public about
reducing and avoiding such damage and costs.
Climate Change Department means the Department administered by the Minister
administering the National Greenhouse and Energy Reporting Act 2007.
Controlling corporation has the same meaning as in the National Greenhouse and
Energy Reporting Act 2007, a constitutional corporation that does not have a holding
company incorporated in Australia.
Emission, of a greenhouse gas, means the following:
a) A scope 1 emission of greenhouse gas within the meaning of section 10 of the
National Greenhouse and Energy Reporting Act 2007 which allows the Minister to
define scope 1 emissions by legislative instrument.
b) A scope 2 emission of greenhouse gas within the meaning of section 10 of the
National Greenhouse and Energy Reporting Act 2007 which allows the Minister to
define scope 2 emissions by legislative instrument.
c) A scope 3 emission of greenhouse gas for which there is an emission factor listed in
the National Greenhouse Accounts Factors, published by the Climate Change
Department, as in force from time to time.
Fossil fuel means thermal coal, oil and gas.
Greenhouse gas has the same meaning as in the National Greenhouse and Energy
Reporting Act 2007 which defines each of the following as a greenhouse gas in section
7A: carbon dioxide, methane, nitrous oxide, sulfur hexafluoride, a hydrofluorocarbon
(which are specified in subsection (2), table 1), a perfluorocarbon (which are specified in
subsection (3), table 2) and a prescribed gas.
Group has the same meaning as in section 8 of the National Greenhouse and Energy
Reporting Act 2007.
Major emitter see section 5 below.
Clause 5: Definition of major emitter
Subsection (1) (a) and (b) states that a person is a major emitter if they are the controlling
corporation of a group and the group is either of both of the following: the producer of fossil
fuels that produced carbon dioxide or other greenhouse gases when used; the owner or
operator of one or more coal-fired power stations that cause carbon dioxide or other
greenhouse gases to be released into the atmosphere; and
Subsection (1) (c) states the total greenhouse gas emissions from either of the below are
greater than 1 million tonnes in any 12 month period that begins on or after 1 September
1990:
The use of the fossil fuel produced by the group, whether or not the group used the
fuel itself, as well as emissions from any of the fuel used in the production process;
or
The use of coal burnt for the electricity produced by any power stations owned or
operated by the group, as well as emissions from any of the coal burnt to power
those stations.
Subsection (1) (d) further adds that either of both of the following apply: the person is a
company (within the meaning of the Corporations Act 2001); the person is a body
corporate incorporated in Australia.
Subsection (2) provides the dates from which the greenhouse gas emissions the major
emitter is responsible for as those made on or after the earlier of the below:
1 September 1990, the date of the first Intergovernmental Panel on Climate Change
report which unambiguously linked fossil fuels to global warming. Therefore, from at
least this date onwards, every major emitter has known, or should have known
about the impact of their greenhouse house gas emissions on climate change;
The day the major emitter knew, or ought to have known, that the group's
production of fossil fuels, or owning or operating coal-fired power stations would
contribute to climate change.
Clause 6: Actions for climate change damage
Clause 6 sets out who can bring an action for climate change damage and the ability of the
Federal Court.
Subsections (1) and (2) provide for a person who has suffered climate change damage,
the Attorney-General of the Commonwealth, or of a State or Territory on behalf of a person
or persons, to bring an action against a major emitter for climate change damage.
Subsection (3) provides for the type of relief the court can grant, including damages and
an injunction, which can include any terms the court thinks fit including requiring a major
emitter to reduce or cease activities that may cause climate change damage in the future.
Subsection (4) sets out how the court may determine the amount of damages the major
emitter is liable for. When deciding, the court may assume the major emitter's share of the
climate change damage (as per subsection 5(2)) is at least the same as their share of total
global greenhouse gas emissions. Subsection (5) states that nothing in subsection (4)
limits the court's ability to determine that a major emitter is jointly and severally liable for
the entirety of the damage.
Subsection (6) clarifies that a person may bring an action against a major emitter for
climate change damage (suffered by that person) regardless of whether the production of
fossil fuels, or owning or operating a coal-fired power station, was required or authorised
by law.
Clause 7: Evidentiary matters
Clause 7 sets out the evidentiary considerations when determining whether a major
emitter is liable for climate change damage.
Subsection (1) clarifies that evidence confirming the major emitter's group has produced
greenhouse gas emissions to the extent specified in subsection 5(1)(c) is sufficient to
demonstrate the major emitter has contributed to climate change damage.
Subsection (2) sets out what the court may take into account when determining whether
damage constitutes climate change damage as any of the following: scientific or statistical
information or modelling; historical experience; information derived from relevant studies,
including information derived from sampling.
Subsection (3) sets out what evidence is sufficient to demonstrate that a weather event
was caused by climate change. Evidence that climate change has increased the likelihood
of that type of event occurring; or that climate change has increased the likelihood of that
type of weather event will be more severe when it occurs and the relevant weather event is
of that severity are considered sufficient.
Clause 8: No limitations period
This clause removes any statute of limitations that may otherwise apply in relation to an
action under section 6 which deals with who may bring an action for climate change
damage and the ability of the Federal Court.
Clause 9: Jurisdiction of Federal Court
This clause confirms that the Federal Court will have jurisdiction with respect to section 6
which deals with who may bring and action for climate change damage and the ability of
the court.
Clause 10: Application of this Act
Subsection (1) confirms the Act applies in relation to climate change damage suffered on
or after 1 July 2019, whether or not the greenhouse gas emissions that cause the damage
occurred before, on or after 1 July 2019. This is to allow actions to be brought for damages
that occurred before the commencement of this Act. For example, victims of the 2019-20
bushfires are able to utilise the Act.
The note clarifies that while this clause refers to greenhouse gas emissions occurring
before, on or after 1 July 2019, the limitations of subsection 5(2) with respect to the dates
from which emissions occurred still apply, for example, a major emitter is generally only
responsible for greenhouse gas emissions occurring on or after 1 September 1990.
Subsection (2) states the Act is not intended to exclude or limit the operation of the general
law or a law of a State or Territory that is capable of operating concurrently with this Act.
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
Liability for Climate Change Damage (Make the Polluters Pay) Bill 2021
This bill is compatible with the human rights and freedoms recognised or declared in the
international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny)
Act 2011.
Overview of the bill
This Bill makes fossil fuel companies liable for climate change damage, giving victims of
climate change, such as the 2019 - 2020 bushfire survivors, the right to bring an action
against thermal coal, oil and gas companies for climate change damage.
Major emitters of greenhouse gases, including fossil fuel producers and owners or
operators of coal-fired power stations, will be liable for climate change damage if their
emissions are greater than 1 million tonnes in any 12 month period that began on or after
1 September 2020. The first Intergovernmental Panel on Climate Change report was
released in that year, unambiguously linking fossil fuels to global warming. From at least
this time onwards, every fossil fuel corporation has known, or should have known, about
the consequences of their actions. For corporations that actively knew about the
consequences of their actions earlier, liability will attach from that earlier date.
A person who suffered climate change damage, the Attorney-General of the
Commonwealth, or of a State or Territory, can bring an action against a major emitter. The
Federal Court of Australia will have the ability to:
Grant an injunction requiring the major emitter to reduce or cease activities that may
cause climate change damage in the future; and
Determine the amount of damages the major emitter is liable for. When deciding,
the court may assume the major emitter's share of the climate change damage is at
least the same as their share of total global greenhouse gas emissions.
Human rights implications
This bill is compatible with human rights because it does not raise any human rights issues
and increases the likelihood humans will stay alive, healthy and safe.
Adam Bandt MP