Climate and resources regulation 

Climate change and natural resource extraction sit at opposite ends of a familiar pattern in Australian environmental law: greenhouse gas emissions are addressed mainly through Commonwealth mechanisms, while mining and petroleum extraction are approved mainly through state and territory regimes. Both areas interact heavily with the ecologically sustainable development principles and approval structures described elsewhere in this module, and both are in a state of active development rather than settled doctrine.

Commonwealth regulation of greenhouse gas emissions

The Commonwealth does not regulate greenhouse gas emissions through a single, comprehensive statute analogous to a state's core environmental protection Act. Instead, emissions are addressed through a combination of mechanisms that have evolved significantly over time and continue to change:

• a national greenhouse gas and energy reporting framework requires large emitters and energy users to measure and report their emissions and energy consumption to the Commonwealth, giving government and the public a basis for assessing performance;
• a safeguard mechanism places obligations on Australia's largest industrial emitters to keep net emissions within baselines that are progressively reduced over time, creating a form of emissions constraint on major facilities without regulating every emitter in the economy;
• a national framework for generating and trading carbon credit units, under which eligible projects that reduce emissions or remove carbon from the atmosphere can generate tradeable credits, which are used both by government purchasing and by regulated entities to help meet obligations such as those under the safeguard mechanism; and
• Commonwealth legislation setting economy-wide emissions reduction targets, which operate as legislated policy commitments and inform the design and stringency of the mechanisms above, rather than being directly enforceable against individual emitters.

These mechanisms are not static. Baselines, targets, eligible methods for generating credits, and reporting thresholds are all subject to periodic legislative and regulatory revision, and new mechanisms are added or existing ones substantially redesigned relatively frequently compared with most other areas of Australian law.

State-based regulation of resource extraction

By contrast, approval to explore for or extract minerals or petroleum is governed overwhelmingly by state and territory resources legislation. Each state and territory administers its own system of exploration and production titles (sometimes called licences, leases or permits depending on the jurisdiction and the resource), granted by the relevant state or territory minister or department, and subject to conditions addressing matters such as environmental management, rehabilitation, and royalties payable to the state. A resources project typically also requires separate environmental and planning approvals under the same state's environmental and planning legislation, so a single mining or petroleum project can involve several distinct state approval processes running in parallel, in addition to any Commonwealth EPBC Act approval that may be triggered if a matter of national environmental significance is likely to be affected — a proponent who thinks an action may be a controlled action must refer it to the Minister, who decides whether it is one, unless the Minister has already informed the proponent that the proposal has been referred.¹

That duty is qualified. As at 3 October 2026, s 71A of the EPBC Act, in force since 24 August 2026, provides that a person must not refer a proposal for a controlled-action decision at a time when an "alternate pathway" applies to the action.² The pathways it identifies are a declaration, or a declaration included in a bilateral agreement, that a class of actions needs no approval under Part 9; an approval under s 146B in Part 10 (strategic assessments); and, for actions in a bioregional plan's conservation and development zones, the arrangements for restricted and priority actions. Each is conditional. An action specified in an exclusion determination is outside the declaration pathways, so is a larger action of which only a component is covered by a declaration, and a s 146B approval counts only where s 146D(2) applies. The bioregional-plan limbs depend on plan provisions that are not in the Act as compiled at 24 August 2026. Section 71A was inserted by item 160 of Schedule 1 to the Environment Protection Reform Act 2025 (Cth), which Proclamation (No. 2) 2026 commenced on 24 August 2026; the bioregional-plan provisions are in Part 12A, inserted by item 323, which that Proclamation did not commence.³⁴ A referral made while no pathway applies continues even if a pathway later starts to apply, unless it is withdrawn. Whether a proponent must refer, or may not, therefore depends on the Commonwealth Act, including whether a pathway applies to the action, and not on what the state approvals say.

Because resources approvals are state-based, the detailed content of title conditions, environmental obligations and royalty arrangements varies between jurisdictions, and a student should not assume that a resources approval process described in one state applies in another.

Why this area is unsettled

Climate and resources regulation is unusually dynamic for several connected reasons. Climate policy responds to international commitments that themselves evolve, to changes of government and shifts in policy priority, and to rapidly developing scientific understanding of both the urgency of emissions reduction and the feasibility of particular mitigation technologies. At the same time, resources projects increasingly generate disputes about the relationship between approving new extraction and Australia's climate commitments — including litigation testing whether decision-makers assessing resources or export approvals must consider the downstream (so-called "scope 3") emissions from burning exported fossil fuels, and litigation testing the adequacy of climate-related disclosure and risk consideration in regulatory decision-making more generally. These disputes are still working through the courts and through legislative reform, and the legal position on several significant questions in this space has changed, and may continue to change, materially within a short period. Treat any specific mechanism described here as a starting point for further research rather than a fixed statement of current law.

Applying this in a problem question

1. Separate the emissions question from the resources-approval question — they are regulated through different mechanisms and often by different levels of government.
2. For an emissions issue, identify which Commonwealth mechanism is engaged: reporting, the safeguard mechanism, carbon credits, or a legislated target.
3. For a resources-approval issue, identify the specific state or territory whose title and approval regime applies, and do not assume uniformity across jurisdictions.
4. Check whether the resources project also triggers a Commonwealth EPBC Act approval alongside its state approvals, and whether an alternate pathway under s 71A applies in place of referral.
5. Flag explicitly that this is a fast-moving area of law and policy, and that any mechanism identified should be checked against its current form before being relied on.