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Rio Tinto has commended the Federal Government’s emissions-reduction policy for providing support to heavy industry.

Rio Tinto has commended the Federal Government’s emissions-reduction policy for providing support to heavy industry.

From July 1, Australia’s largest polluting sites will be expected to cut their emissions intensity by 4.9 per cent a year until 2030 under a draft Government climate policy.

The plan, which is designed to encourage cleaner practices rather than cut production, allows businesses to use carbon credits to meet the reduction targets.

“These proposed reforms have been carefully calibrated to deliver the policy certainty and support Australian industry needs through decarbonisation,” Federal Climate Change and Energy Minister Chris Bowen said when releasing the plan on Tuesday.

“We’ve been extremely encouraged by the level of engagement in the process to date and look forward to continued constructive engagement as we finalise the design of these critical reforms for Australia’s net-zero pathway.”

Rio Tinto Australian chief executive Kellie Parker praised the Government for supporting heavy industry.

“We will need to work through the details to see exactly what it means for all of our assets, but the Government’s climate ambitions align with our own commitment to net-zero emissions by 2050 and our plans to decarbonise our Gladstone assets to meet our group climate targets,” she said.

“We really appreciate the support of government as we pursue the decarbonisation of our assets.”

Minerals Council of Australia chief executive Tania Constable was more measured in her response. She echoed industry concerns that the cost of meeting the new emissions requirements could impact the export competitiveness of mining companies, which represent close to half of the facilities covered by the new plan.

“We want to see an approach that puts Australia on a pathway to that 2030 target, but we need to keep our trade-exposed export industries strong and competitive,” Constable said.

The Government, however, has said that some industries that are considered “trade-exposed” could apply to cut their emissions more slowly than the prescribed timeline.

Under the policy, new facilities – such as coal and gas operations – would still be allowed to open, though they would have to fit within the annually reducing emissions total.