The federal government has unveiled the changes it wants to make to its carbon pricing laws to allow for an emissions trading scheme (ETS) to start a year earlier than planned.
Prime Minister Kevin Rudd wants to terminate the carbon tax on July 1, 2014, but switching early from a fixed to a floating price requires a number of legal changes to pass both houses of parliament.
The government on Thursday released its proposed amendments to the Clean Energy Act, outlining what needs to happen before an emissions trading scheme (ETS) can commence.
It's looking for stakeholder responses to its draft plan by August 15.
Importantly, the amendments ensure there will be a pollution cap in place by July 1 next year.
Emissions trading requires the government to set absolute limits on Australia's annual CO2 output, and the Clean Energy Act required caps to be in place for the first five years of a floating carbon price.
Environment groups are hoping tough caps will be set under Australia's ETS so a 25 per cut in emissions can be achieved by the end of the decade.
The Climate Change Authority is currently considering what these pollution caps should look like from 2015, but now has more work on its hands.
Climate Change Minister Mark Butler has written to the authority's chair Bernie Fraser asking it for a "special review" to recommend a pollution cap for 2014/15.
The authority can only advise on these caps, and ultimately it's the climate change minister who makes the final call after he's handed the recommendations in February next year.
Opposition climate action spokesman Greg Hunt accused the prime minister of being "disingenuous" by presenting draft legislation without either recalling parliament or announcing an election.
"Mr Rudd should stop playing games with Australian families and businesses," he said in a statement.
Also under the proposed changes, government assistance to the biggest coal-fired generators will be scrapped after the first year of an ETS.
The amendments, if passed, will also allow Australia's biggest polluters - about 370 companies - to look overseas to offset up to 50 per cent of their pollution liability from July next year.
The government says the Clean Energy Regulator is "well-advanced" in preparing for the shift, and is confident businesses back the move.
Treasury forecasts Australia's carbon price to plunge from $24.15 per tonne to around $6 per tonne when the ETS links with Europe next year, and rise throughout the decade.
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