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2022-2025
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
SENATE
Liability for Climate Change Damage (Make the Polluters Pay) Bill 2025
EXPLANATORY MEMORANDUM
(Circulated by authority of Senators Faruqi and Waters)
LIABILITY FOR CLIMATE CHANGE DAMAGE (MAKE THE
POLLUTERS PAY) BILL 2025
OUTLINE
This Bill makes fossil fuel companies liable for climate change damage, giving victims of
climate change fuelled events, such as Tropical Cyclone Alfred, 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 total emissions
are greater than 1 million tonnes in any 12-month period that began on or after 1 September
1990. 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).
NOTES ON CLAUSES
Clause 1: Short Title
1. Clause 1 is a formal provision specifying the short title of the Bill.
Clause 2: Commencement
2. This clause states the Bill commence the day after it receives Royal Assent
Clause 3: Simplified outline of this Act
3. This clause provides a simplified outline of this Bill. 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
4. This clause defines terms used in the Bill, some of which have the same meaning as
other Acts 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, the following:
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 analysing 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 of section 7A of that Act), a perfluorocarbon (which are
specified in subsection (3), table 2 of section 7A of that Act) 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 clause 5 below.
Clause 5: Definition of major emitter
Subclause 5(1) states that a person is a major emitter if
a) they are the controlling corporation of a group; and
b) the group is either of both of the following:
(i) the producer of fossil fuels that produce carbon dioxide or other greenhouse
gases when used;
(ii) 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
c) 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:
(i) 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
(ii) 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; and
d) either or both of the following apply:
(i) the person is a company (within the meaning of the Corporations Act 2001);
(ii) the person is a body corporate incorporated in Australia.
Subclause 5(2) provides that the date on or after which the major emitter is responsible for
the greenhouse gas emissions is the earlier of the below:
a) 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);
b) 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 abilities of the
Federal Court.
Subclauses 6(1) and 6(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.
Subclause 6(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.
Subclause 6(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 subclause 5(2)) is at least the same as their share of total
global greenhouse gas emissions. Subclause 6(5) states that nothing in subclause 6(4) limits
the court's ability to determine that a major emitter is jointly and severally liable for the
entirety of the damage.
Subclause 6(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, including clarifying that the standard of proof is on the
balance of probabilities.
Subclause 7(1) clarifies that evidence confirming the major emitter's group has produced
greenhouse gas emissions to the extent specified in paragraph 5(1)(c) is sufficient to
demonstrate the major emitter has contributed to climate change damage.
Subclause 7(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.
Subclause 7(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 clause 6 which deals with who may bring an action for climate change damage
and the relief that may be granted by the Federal Court.
Clause 9: Jurisdiction of Federal Court
This clause confirms that the Federal Court will have jurisdiction with respect to clause 6
which deals with who may bring an action for climate change damage and the relief that may
be granted by the Federal Court.
Clause 10: Application of this Act
Subclause 10(1) confirms the Bill will apply in relation to climate change damage suffered on
or after 1 January 2025, whether or not the greenhouse gas emissions that cause the damage
occurred before, on or after 1 January 2025. This is to allow actions to be brought for damage
that occurs before the commencement of this Bill.
The note clarifies that while this clause refers to greenhouse gas emissions occurring before,
on or after 1 January 2025, the limitations of subclause 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.
Subclause 10(2) states the Bill 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 Bill.
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Liability for Climate Change Damage (Make the Polluters Pay) Bill 2025
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 fuelled events, such as Tropical Cyclone Alfred, 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 total emissions
are greater than 1 million tonnes in any 12-month period that began on or after 1 September
1990. 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 does not engage any of the applicable rights or freedoms.
Conclusion
This Bill is compatible with human rights as it does not raise any human rights issues.
Senators Faruqi and Waters