<P> The energy policy of Australia is subject to the regulatory and fiscal influence of all three levels of government in Australia, although only the State and Federal levels determine policy for primary industries such as coal . </P> <P> As of 2016, Federal energy policies continue to support the coal mining and natural gas industries through subsidies for fossil fuel use and production as the exports by those industries contribute significantly to the earnings of foreign exchange and government revenues . Australia is one of the most coal - dependent countries in the world . Coal and natural gas, along with oil - based products, are currently the primary sources of Australian energy usage and the coal industry produces approximately 38% of Australia's total greenhouse gas emissions . In 2015 Federal policy reverted to a pro-coal economy with cuts to alternate and renewable energy government offices, targets and subsidies </P> <P> Federal climate change policy changed following the election of the Labor Rudd Government in December 2007, which committed to introduce an Emissions Trading Scheme in 2010, and to expand the mandatory renewable energy target to ensure 20% of electricity supply in Australia was from renewable sources by 2020 . After a contentious political debate, a carbon pricing mechanism entered force on 1 July 2012 under Prime Minister Julia Gillard, but was repealed by the Abbott Government in 2014 . In June 2015 the Abbott Government downgraded the renewable energy target from 41,000 GWh per year to 33,000 GWh . </P>

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