Telstra will depart from the federal government’s Climate Active carbon neutral labelling program, opting instead for direct action to reduce emissions. This decision marks a significant shift as Telstra, previously a major participant in the program, will no longer claim carbon neutrality through carbon offsets.
The Climate Active program, criticised in a Senate inquiry for enabling "greenwashing," has about 700 participants who pay an annual licence fee to label their products and services as carbon-neutral. Despite this, the Australian Competition and Consumer Commission (ACCC) has suspended the program's trademark certification process due to unresolved rule clarifications.
Telstra, which has claimed carbon neutrality since 2020 by purchasing carbon credits, clarified that its decision is not due to concerns about the program or the credibility of carbon credits. Telstra head of environment Tom Penny said consultation with stakeholders revealed they prefer a direct approach to emission reduction.
Consequently, Telstra will remove carbon neutrality claims from its mobile phone plans and cease offsetting emissions from July 1. Telstra will also raise its scope one and two carbon emission reduction targets from 50% to 70% by 2030, while maintaining a 50% target for scope three emissions. The company has achieved a 30% reduction in scope one and two emissions since the 2019 financial year.
Telstra emphasised that as one of Australia’s largest electricity users, it is prioritising direct emissions reduction from its network. The company aims to enhance consumer understanding of its climate impact by redirecting investments from carbon credits to direct climate action in Australia. This includes investing in efficient technology, decommissioning inefficient infrastructure, and exploring green hydrogen cells and artificial intelligence for improved efficiency.
Penny reiterated that the move was about transparency rather than doubts about the credibility of carbon offsets. He noted that while Telstra supports the Climate Active program, its new climate strategy does not align with the program's requirements.
Climate Active under review
Last year, the Albanese government announced a review of the Climate Active certification, proposing updates such as removing the term “carbon neutral” and implementing stricter reporting requirements.
Greens Senator Sarah Hanson-Young criticised companies for misleading consumers with unverified green claims under the program, saying “Australian customers are fed up with greenwashing lies”.
The Department of Climate Change, Energy, the Environment and Water (DCCEEW), however, defended its use, noting that Climate Active members had achieved better emissions reductions.