Australia’s federal Greens have backed a contested carbon-credit scheme linked to the proposed Great Koala National Park in New South Wales, ending a bitter internal dispute but exposing one of the party’s deepest divisions over climate policy.
The decision means the Senate will not overturn the improved native forest management method, which allows state governments to earn Australian carbon credit units for protecting forests that might otherwise be logged.
The Nationals had sought to disallow the method, arguing it could undermine the timber industry. The Greens hold the balance of power, placing the party at the centre of a dispute that has divided environmental organisations, scientists and former campaigners.
Three Greens senators — Nick McKim, Vanessa Bleyer and Jordon Steele-John — crossed the floor to oppose the deal. They said they would vote according to their consciences, arguing that forests should not have to be turned into financial assets before they could be protected. ([greens.org.au](https://greens.org.au/news/media-release/statement-improved-native-forest-management-instrument-senators-mckim-bleyer?utm_source=openai))
Greens leader Larissa Waters said negotiations with the federal government had secured changes to the scheme. The party said the amendments would increase the required reduction in logging from 20 per cent to 30 per cent from 2030, prevent native forests from being reclassified as plantations and create a legal pathway to stop credits being sold to coal and gas companies where the relevant state government had made that commitment. ([greens.org.au](https://greens.org.au/news/media-release/real-pollution-cuts-not-accounting-tricks-greens-announce-support-improved-infm?utm_source=openai))
Why the Great Koala National Park became the test case
The dispute centres on a proposed reserve in northern New South Wales, near Coffs Harbour. The NSW government says the park’s current design depends on revenue from carbon credits generated by ending or reducing logging across the area.
The proposed park would cover about 476,000 hectares, including 176,000 hectares of newly protected forest, according to reports on the plan. The NSW Greens and several major conservation groups supported allowing the method to remain, saying it could provide a route to end native forest logging and help fund the reserve. ([theguardian.com](https://www.theguardian.com/australia-news/2026/sep/10/greens-senators-to-cross-floor-over-contentious-koala-park-deal?utm_source=openai))
Opponents, including the Wilderness Society, the Australia Institute and the Bob Brown Foundation, argued that the park had been promised before carbon credits were attached to it. They questioned whether the proposal met the requirement of “additionality” — the principle that credits should only be issued for emissions reductions that would not otherwise have happened.
They also warned that credits generated by forest protection could allow major polluters to offset emissions rather than reduce them directly. The three dissenting senators said the arrangement would make it easier and cheaper for heavy emitters to continue polluting, while giving the impression of climate action.
The Greens’ federal partyroom said the changes negotiated with Labor would deliver stronger protections and help bring forward new national parks. The party also signalled that its support for the forest method did not amount to an endorsement of the wider carbon-credit system, declaring its opposition to separate legislation and another proposed land-management method that it said would generate far larger volumes of offsets. ([greens.org.au](https://greens.org.au/news/media-release/real-pollution-cuts-not-accounting-tricks-greens-announce-support-improved-infm?utm_source=openai))
Supporters of the forest scheme include Greenpeace, WWF-Australia, the NSW Nature Conservation Council, the NSW National Parks Association and a number of prominent ecologists. They argue that carefully designed credits can create a financial incentive to leave native forests standing, particularly in states where logging remains commercially important.
Former NSW National Parks and Wildlife Service head Atticus Fleming has estimated that ending native forest logging across the state could generate more than $1 billion in credits over 15 years. The carbon-credit method’s architect, Australian National University professor Andrew Macintosh, has said projects using it would issue roughly 100,000 to 150,000 credits a year during the first five years — a relatively small share of the wider market.
That argument has done little to settle the broader disagreement. Critics maintain that the integrity of offsets is too uncertain and that forests should be protected because of their ecological value, rather than because they can be used to compensate for industrial emissions elsewhere.
The vote has therefore become more than a decision about one national park. It is a test of whether environmental protection can be financed through Australia’s existing carbon market, and whether the Greens are prepared to support an imperfect mechanism when they believe it could deliver immediate gains for threatened forests and wildlife.
