Lawyers are awaiting a flurry of activity as the introduction of a carbon price draws nearer. The Clean Energy Bill 2011 passed through the lower house of parliament narrowly, 74 votes to 72, and will now go to the Senate to become law.

Legal commentators have reacted to the news with optimism that corporates who had been holding back on taking action will now step up a gear as the start date of July 1 2012 becomes a reality.
Norton Rose global head of climate change Anthony Hobley said many Australian businesses had been reluctant to take action because of the collapse of the Carbon Pollution Reduction Scheme.
“They have decided to wait, and have taken an ‘I will believe it when I see it’ approach,” said Hobley. “But from now they will need to move quickly, because the time frame is incredibly short, and there are a number of key differences between this scheme and the CPRS.”

A number of changes were made from the draft legislation released in August to the final bill passed yesterday, including the provision for large consumers of fuel to opt into the scheme, including airlines. Under the original plan, the aviation, shipping and rail industries were to be excluded and instead pay higher fuel excise. “There is significant interest in the decision to allow those companies to opt into the carbon price scheme,” said Hobley. “The changes to rules for companies which use large amounts of liquid fuels will create a lot of work for us.”

But it’s not just the climate change lawyers who are set to benefit from the scheme. Hobley predicts many legal practice areas will be inundated with work relating to the introduction of not only the carbon price, but also the green energy fund. “I'm expecting to see a boom in the renewable energy, green energy and clean energy space,” he added.

DLA Piper tax partner James Newnham is also expecting a period of high activity as a result of the carbon price introduction. “As we saw in the UK and Europe, there was a lot of work arising as a result of their Emissions Trading Scheme,” he told ALB. “There is going to be a lot of work generated for areas that are not directly associated with the green energy economy.”

Legal practice areas such as M&A, tax, financing, projects and many more will all be in demand as the start date draws near, said Newnham. “I think every lawyer in every affected area will need to understand the core rules and then the consequential effect on their particular areas,” he added.  “In M&A deals, particularly where there is an overseas purchaser, they are asking what the impact of the carbon price will be on the target. And what the target’s ability will be in dealing with the new scheme and what potential impact it could have on the profitability etc of the target.”

Newnham said big emitters who would be paying the carbon price directly had more certainty than those companies which rely on products or services from those emitters. “There is still a lot of uncertainty about whether the cost will be passed on and if it is, how will they know,” he said.

Related stories: 

New carbon legislation a bevy of work for lawyers 1 August 2011

Carbon proposal gets thumbs up from legal industry 11 July 2011