{"id":809005,"date":"2026-07-18T22:15:24","date_gmt":"2026-07-18T22:15:24","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/809005\/"},"modified":"2026-07-18T22:15:24","modified_gmt":"2026-07-18T22:15:24","slug":"australias-fuel-tax-break-slowing-bhps-decarbonisation-mining-giants-investors-warned-australia-news","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/809005\/","title":{"rendered":"Australia\u2019s fuel tax break slowing BHP\u2019s decarbonisation, mining giant\u2019s investors warned | Australia news"},"content":{"rendered":"

A briefing document circulated to BHP<\/a> investors has warned that the federal government\u2019s fuel tax break is acting as a handbrake on the decarbonisation of the miner\u2019s Australian operations.<\/p>\n

Earlier this year, a leaked cache of documents obtained by Guardian Australia and the ABC\u2019s Four Corners<\/a> revealed BHP had halted or delayed key emissions reductions projects, just years after describing climate change as an \u201cexistential\u201d threat that required the greatest mobilisation since the second world war.<\/p>\n

The leaked documents showed<\/a> how BHP, a major polluter and one of the world\u2019s worst historic contributors to the climate crisis, had shelved massive renewables projects in Western Australia, pushed back the electrification of its highly polluting Pilbara diesel truck fleet, and scrapped a processing plant<\/a> that would have significantly cut emissions for its steel making customers.<\/p>\n

A briefing document distributed this week to BHP investors cited the Guardian and ABC revelations and said they posed serious questions about the transparency and accountability of the company\u2019s decarbonisation program. The briefing document encouraged investors to ask BHP whether it would set a medium-term emissions reductions target, saying its absence meant \u201cthere is no clear imperative to decarbonise in the medium-term\u201d.<\/p>\n

The briefing, compiled by the Australian Centre for Corporate Responsibility, included analysis suggesting the federal government\u2019s fuel tax break was hampering the company\u2019s progress on decarbonisation.<\/p>\n

The company\u2019s vast fleet of diesel haul trucks is one of its biggest sources of emissions. But BHP\u2019s costs for using the diesel fleet is offset by a federal tax break, which was worth $622m to the company last financial year. BHP is the single biggest recipient of the tax break.<\/p>\n

The ACCR\u2019s analysis suggests that the fuel tax credit was having a \u201cmaterial impact on the financial attractiveness of diesel abatement projects\u201d. It found removing the tax break would cause four major decarbonisation projects \u2013 the electrification of its truck and rail fleets in inland WA, for example \u2013 to transform from neutral to positive returns on investment.<\/p>\n

ACCR head of engagement and sector strategy Naomi Hogan said the removal of the tax credit would make \u201cmost of BHP\u2019s fleet electrification projects become financially viable with just the removal of this policy\u201d.<\/p>\n

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\u201cPolicymakers should be under no illusion: decarbonisation in the mining sector is likely being delayed because of the fuel tax rebate,\u201d Hogan said. \u201cThe financial signals for decarbonisation would be much stronger with the removal of this policy.\u201d<\/p>\n

Labor faces internal pressure on the policy before the party\u2019s national conference in Adelaide next week.<\/p>\n

More than 270 local ALP branches across the country have passed motions supporting a Labor Environment Action Network (Lean) campaign to limit the credits to $50m per company.<\/p>\n

Labor MP Jerome Laxale broke ranks in May<\/a>, after the Guardian\u2019s investigation, to publicly back the changes, saying it was \u201creasonable to expect more\u201d from big miners.<\/p>\n

Independent senator David Pocock has also backed calls<\/a> for changes to the concession, saying BHP was \u201claughing\u201d at Australia\u2019s key climate policy, the safeguard mechanism, while pocketing hundreds of millions of dollars in tax breaks.<\/p>\n

\u201cBHP had [to pay] $8m for emissions [under the safeguard mechanism] last year while getting $379m in fuel tax credits \u2026 you have to admit that\u2019s pretty ridiculous,\u201d he said. \u201cThey are spending 2% [of what they receive in diesel tax credits]. That sounds like a joke to most Australians.\u201d<\/p>\n

The ACCR analysis also warned BHP investors that delays on decarbonisation would expose it to greater carbon costs. The company\u2019s initial decarbonisation plan \u2013 outlined in a document to shareholders in 2024 \u2013 would cost it US$11.2bn to $19.3bn in forced and voluntary purchases of carbon credits by 2050, the analysis said. A 10-year delay to its plans would increase those costs to US$16.6bn to $28.5bn, an increase of 48%.<\/p>\n

Hogan said BHP\u2019s delays to decarbonisation posed \u201csignificant risks\u201d for investors.<\/p>\n

\u201cBHP has built a reputation with its investors as a safe set of hands to navigate the transition, but trust has been tested in recent times as more evidence of decarbonisation delays and deprioritisation comes to light,\u201d she said.<\/p>\n

\u201cThere is strong investor interest and a growing disquiet around the lack of transparent information from the company on the potential costs of pushing back decarbonisation and what it means for BHP\u2019s emissions reduction pathway.\u201d<\/p>\n

BHP set a target of 30% emissions reductions by 2030 and has a goal to reach net zero in 2050. It has achieved its 2030 target already, largely by buying renewable power at overseas operations and the 2024 suspension of its struggling Western Australian nickel operations.<\/p>\n

The company has engaged in a public relations campaign to boost its decarbonisation credentials since the revelations in the Guardian and the ABC, flying media to the Pilbara in a bid to promote an ongoing trial of electric haul trucks. The company has blamed slow technological advancement in large battery-electric haul trucks for delaying its decarbonisation projects.<\/p>\n

The ACCR briefing tells investors that only 4% of BHP\u2019s emissions reductions have been from Australian operations. The briefing says BHP\u2019s stalled progress cannot be explained simply by technology delays.<\/p>\n

\u201cBHP\u2019s actions no longer appear consistent with its ambition to \u2018lead the evolution of [the mining] industry\u2019,\u201d the briefing says.<\/p>\n

\u201cThis change in ambition reflects more than technology delays. It has delayed, curtailed or stopped several of its key decarbonisation projects, and deferred 87.5% of planned operational decarbonisation spend this decade.\u201d<\/p>\n

BHP said it had reduced its emissions by 36% from 2020 levels and continued to hold a goal of hitting net zero by 2050.<\/p>\n

A spokesperson said the company had been transparent about its plan to reach its goals with shareholders, and had indicated it was \u201creliant on third party technologies the industry needs to electrify equipment\u201d.<\/p>\n

The delays to its decarbonisation program had been explained publicly in its 2025 annual report and elsewhere, the spokesperson said.<\/p>\n

\u201cOur plans account for these challenges and we now expect to adopt diesel displacement technologies at scale in our operations post FY2030 and as indicated in our annual report 2025 that our continued decarbonisation efforts will result in spend of at least US$4bn in the 2030s,\u201d the spokesperson said.<\/p>\n

\u201cWe also continue to work with industry partners and equipment producers to accelerate solutions, including trials of two 240-tonne battery-electric haul trucks in the Pilbara, and four battery-electric locomotives in coming months.\u201d<\/p>\n

A spokesperson for the resources minister, Madeleine King, said the government was not considering any changes to the fuel tax credit arrangements.<\/p>\n

\u201cThe fuel tax credit is not a subsidy, grant or handout. It ensures businesses are not taxed for fuel used off public roads, and fuel used on road and rail which those businesses themselves have paid to build and maintain,\u201d the spokesperson said.<\/p>\n

\u201cThe Safeguard Mechanism supports resources sector decarbonisation by setting clear incentives for companies to invest and reduce their emissions.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"A briefing document circulated to BHP investors has warned that the federal government\u2019s fuel tax break is acting…\n","protected":false},"author":2,"featured_media":809006,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[64,63,44],"class_list":["post-809005","post","type-post","status-publish","format-standard","has-post-thumbnail","category-australia","tag-au","tag-australia","tag-news"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/809005","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=809005"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/809005\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/809006"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=809005"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=809005"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=809005"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}