EnergyAustralia has reached an out-of-court settlement following claims it “greenwashed” more than 400,000 customers.
Parents for Climate launched legal action against the electricity provider in the Federal Court in 2023.
The advocacy group alleged the marketing of EnergyAustralia “Go Neutral” product was misleading or deceptive.
EnergyAustralia has acknowledged that “carbon offsetting is not the most effective way to assist customers to reduce their emissions” and apologised to its customers in a statement.
Chief customer officer Kate Gibson said the utility provider participated in the Climate Active certified carbon offset program in good faith.
“In recent years, questions have begun to emerge about the benefits of carbon offsets, including those offered as part of certified Government programs such as Climate Active and whether they are having the impact intended,” she said.
“EnergyAustralia accepts that there is legitimate public concern about the efficacy of these programs.”
The product was withdrawn from the market in 2024.
Parents for Climate welcomed this acknowledgement and apology from EnergyAustralia, marking a major win. Parents for Climate the case is the first of its kind in Australia.
“This historic acknowledgement by EnergyAustralia, of the problems with carbon offsetting, is a huge step forward for their 1.6 million customers," said Nic Seton, CEO of Parents for Climate.
"It will set a new standard for the way carbon offset products are used by corporations and sold to consumers."
Competition watchdog the Australian Competition and Consumer Commission (ACCC) has been cracking down on greenwashing - unsubstantiated claims of environmental sustainability.
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