From July 1, 2016, a safeguard mechanism will be introduced for the Emissions Reduction Fund (ERF), the centrepiece of the federal government's suite of policies to tackle climate change.
The ERF has three elements: crediting, purchasing and safeguarding emissions reductions.
The safeguard mechanism will ensure that emission reductions purchased by the government are not offset by significant increases in emissions above business-as-usual levels elsewhere in the economy.
As set out in the Safeguard Mechanism Consultation Paper in March 2015, benchmarks will be established for new industrial projects that commence post 2020.
As part of the consultation process the government this week released draft guidelines on the process for setting these benchmarks.
This extensive consultation with industry and the community will be followed by expert review by an independent committee.
Work will begin on the first benchmarks once the guidelines are finalised. They will apply after 2020 to new facilities or significant expansions covered by the safeguard mechanism.
Interested businesses are invited to make written submissions on the draft guidelines by May 6, 2016.