The Safeguard Mechanism commenced in 2016. It was reformed in 2023 to reduce safeguard facility baselines in line with Australia's emission reduction targets.

Learn about how the Safeguard Mechanism worked before the reformed scheme commenced on 1 July 2023.

Overview of the Safeguard Mechanism from 2016 to 2023

The Safeguard Mechanism has iteratively changed since it was established in 2016.

Baselines from 2016 to 2023

There were 6 different types of baselines available to safeguard facilities from the 2016–17 to 2022–23 financial year:

  • default baseline (from 2016–17)
  • reported baselines (from 2016–17 to 2020–21)
  • calculated baselines (from 2016–17 to 2022–23)
  • production-adjusted baselines (from 2016–17 to 2022–23)
  • sectoral baseline (from 2016–17)
  • landfill baselines (from 2021–22).

The standard baseline replaced production-adjusted and calculated baselines. The default, landfill and sectoral baselines remain.

Find out more about baselines under the reformed scheme.

Default baseline

The default baseline of 100,000 tonnes of carbon dioxide equivalent (tCO2-e) applies to all safeguard facilities with no other baseline type. It is still available under the current scheme.

Reported baseline

Reported baselines were calculated from emissions reported under the National Greenhouse and Energy Reporting scheme between 2009–10 and 2013–14.

Reported baselines expired 1 July 2021. Facilities could instead:

  • apply for a production-adjusted or calculated baseline
  • receive the default baseline of 100,000 tCO2-e.

Calculated baseline

Calculated baselines were set using an independently audited production forecast. This was multiplied by the emissions-intensity per unit, using either the:

Production-adjusted baseline

Production-adjusted baselines were calculated by multiplying the amount of product's a facility’s produced by an emissions-intensity value.

Previous Schedule 2 of the Safeguard Rule defined a range of safeguard facility products as 'production variables'. This included their default emissions-intensity value.

Sectoral baseline

The sectoral baseline is a collective baseline for grid-connected electricity generators. It is still available under the current scheme.

Find out more about the sectoral baseline.

Landfill baseline

The landfill baseline applies to waste facilities. It is still available under the current scheme.

Find out more about landfill baselines.

Managing excess emissions before 1 July 2023

Safeguard facilities could manage their excess emissions under the previous scheme by:

  • surrendering Australian carbon credit units (ACCUs) to offset emissions
  • applying for a multi-year monitoring period (MYMP) for more time to reduce emissions (up to 3 years)
  • applying for an exemption due to criminal activity or a natural disaster.

Facilities can still surrender ACCUs and apply for an exemption under the reformed scheme. They can also:

  • surrender Safeguard Mechanism credit units (SMCs) to offset emissions
  • apply for an MYMP for more time to reduce emissions (up to 5 years) subject to new eligibility requirements
  • apply to borrow baseline from the following year
  • apply to become a trade-exposed baseline-adjusted (TEBA) facility and receive a discounted decline rate.

Learn more about how facilities can manage their emissions under the reformed scheme.

Safeguard facility data

We publish information about all safeguard facilities in April each year. View reports from 2016–2017 to 2022–2023 to see how facilities reported under previous Safeguard Mechanism requirements.

Go to reports and data