Electricity retailer EnergyAustralia has settled a landmark greenwashing legal case brought by Parents for Climate, publicly acknowledging that offsets do not undo the harms of burning fossil fuels.
In July 2023, Parents for Climate launched legal action against EnergyAustralia in the Federal Court alleging that EnergyAustralia’s marketing of its Go Neutral carbon offset product amounted to misleading or deceptive conduct contrary to the Australian Consumer Law.
Related article: EnergyAustralia faces court over greenwashing claims
“EnergyAustralia acknowledges that carbon offsetting is not the most effective way to assist customers to reduce their emissions and apologises to any customer who felt that the way it marketed its Go Neutral products was unclear. EnergyAustralia has now shifted its focus to direct emissions reductions,” the retailer said in a statement.
Parents for Climate said it welcomed this acknowledgement and apology from EnergyAustralia, marking a major win. It is the first legal case of its kind in the country to protect the public from “carbon neutral” greenwashing.
EnergyAustralia has withdrawn its Go Neutral product, saying it acknowledged the importance of consumers understanding the climate impact of products and services offered to them.
“Offsets are not the most effective means of reducing greenhouse gas emissions. There are legitimate concerns about organisations using offsets instead of reducing their own emissions, using offset projects that do not permanently remove carbon from the atmosphere, supporting offset projects where climate benefits are uncertain or would happen anyway, and using carbon neutrality marketing claims based on the use of carbon offsets, which may cause some consumers to think there is no environmental impact from a product or service offered by a business,” EnergyAustralia said in its statement.
“EnergyAustralia today accepts the scientific consensus that these ‘offsets’ do not indefinitely remove greenhouse gas emissions from burning fossil fuels, because carbon is stored in plants for a substantially shorter time than those emissions remain in the atmosphere. Storing carbon in plants is not equivalent to keeping it stored in fossil fuels (by not burning those fossil fuels in the first place).”
Related article: Calls for crackdown on fossil fuel company greenwashing
Parents for Climate CEO Nic Seton said, “This historic acknowledgement by EnergyAustralia, of the problems with carbon offsetting, is a huge step forward for their 1.6 million customers. It will set a new standard for the way carbon offset products are used by corporations and sold to consumers.
“We welcome the acknowledgement from EnergyAustralia. Not only does this acknowledgement send a powerful message that the era of unchecked greenwashing is over, but it’s incredibly reassuring to see the commitment from one of the largest energy retailers in the country to want to do better for their customers and the climate.”
