Jubilee Australia, a human rights and environmental organisation, has filed legal proceedings this morning (18th July) in the Federal Court of Australia against federal government agencies that subsidise new fossil fuel projects but don’t disclose the full environmental impacts of those activities. Jubilee is represented by Equity Generation Lawyers.
The claim is against Export Finance Australia (EFA) which is Australia’s export credit agency, and the Northern Australia Infrastructure Facility (NAIF), a $7bn fund for infrastructure in northern Australia. Both provide taxpayer-subsidised finance for risky new fossil fuel and related projects that would otherwise not go ahead.
“Most people don’t realise that the Australian Government is using taxpayers’ money to fund new fossil fuel projects and infrastructure, through agencies like EFA and NAIF,” Dr Luke Fletcher, Executive Director of Jubilee Australia said.
“The real environmental impacts of EFA and NAIF’s activities are enormous and taxpayers deserve to know. Over the past decade they have given over a billion dollars to some of the most polluting fossil fuel projects in the world that will lock in fossil fuel dependency for decades to come and undermine Australia’s climate commitments under the Paris Agreement.
“With the stroke of a pen, the Australian Government could put an end to these destructive subsidies.
“We hoped that the Climate Change Act 2022 and the Consequential Amendments Act 2022 would help embed emissions reductions into the objectives and functions of key agencies and government departments. Despite this, EFA and NAIF still have the power to support major fossil fuel projects and infrastructure - and, perversely, they continue to fail to adequately report on how the fossil fuel projects they have made possible impact our climate.
“Examples of support include a $164.2m loan to the Ichthys LNG plant, a $254.7m guarantee for the Gladstone LNG terminal that opened up Australia’s fossil gas exports to the world, something which ultimately contributed to huge increases in the costs of fossil gas for Australians when Russia invaded Ukraine, and Australia’s domestic prices were pegged to international markets. Other environmentally damaging projects cited by the claim include Senex Energy’s fracking project in the Surat Basin, the Wiggins Island Coal Export Terminal and the Olive Downs Coal Project.
“There are very real fears that without clearer climate commitments, EFA and NAIF could fund infrastructure in Darwin designed to support a massive expansion of fossil gas – such as Middle Arm, or to subsidise some of the world’s largest fossil fuel companies such as TotalEnergies and ExxonMobil’s Papua LNG project in Papua New Guinea, similar to what EFA has previously done,” Mr Fletcher said.
David Barnden, Principal Lawyer at Equity Generation Lawyers said: “This landmark case is the first in Australia that asks government agencies to own up to the real climate impacts of their activities.
“This action could set a precedent for other government entities to report the true impacts of their activities. Taxpayers deserve transparency about how the Albanese government’s subsidies contribute to broad environmental harm” Mr Barnden said.
Additional background
The action alleges that two government agencies that have a history of subsidising large fossil projects must fully report on the climate and biodiversity effects of their activities on communities and the environment. The action is based on a section of the Environmental Protection and Biodiversity Conservation Act 1999 (Cth) that requires all government agencies and departments to report on, among other things:
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How their activities accord with the principles of ecologically sustainable development - including the precautionary principle and the principle of intergenerational equity;
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The effect of their activities on the environment; and
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What measures, if any, they are taking to minimise the impact of their activities on the environment.
Who is the case against?
Australia’s export credit agency, Export Finance Australia (EFA), known as Export Finance and Insurance Corporation (EFIC) before a rebranding. It funds large and small projects connected to Australian exports, both in Australia and overseas. It can provide loans, guarantees, insurance and equity.
The Northern Australia Infrastructure Facility (NAIF). It is a $7bn government fund to fund infrastructure in northern Australia. It can provide loans, guarantees and equity.
They both provide taxpayer subsidised finance to projects that wouldn’t otherwise go ahead. Because they make these projects possible, in a sense they are fully responsible for the environmental damage caused by the projects.
The action names the Chairpersons of each EFA and NAIF as representatives for the respective Boards, because it is ultimately the Board’s responsibility to report on the effects of the organisation’s activities.
What implications could it have?
The law applies to all government agencies and departments and their activities, including implementing legislation. Boards in other government agencies, and heads of Commonwealth departments, must better understand the impacts their activities have on communities and the environment and report them to the public.
The first step to changing behaviour is understanding and admitting there is a problem.
Where is it being brought?
Federal Court of Australia, filed in Sydney.
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