The new $2 billion package is aimed at ensuring Australia can meet the 2030 emissions reduction target.
Prime Minister Scott Morrison announced a $2 billion extension of Tony Abbott's Direct Action fund, as the centrepiece of his climate change policy.
The renamed Climate Solutions Fund is aimed at ensuring Australia meets its 2030 emissions reduction target by partnering with remote Indigenous communities, small businesses and farmers.
The PM unveiled the funding package in a major speech on Monday, announcing $2 billion will be dedicated over 10 years to cut pollution.
"We acknowledge and accept the challenge of addressing climate change, let's be clear about that," Mr Morrison said on Monday.
"Our approach is to take care of our environment, but also take responsibility to ensure we acknowledge, understand and manage the consequences of the decisions that you make to address climate change," he added.
The prime minister said Australia will meet its Kyoto commitments "at a canter".
"Our government will take and is taking meaningful, practical, sensible, responsible action on climate change without damaging our economy or your family budget," Mr Morrison said.
"Our climate solutions package will ensure Australia meets our 2030 target at a canter."
Mr Morrison said it had set out a target to reduce emissions by 65 per cent of 2005 levels by 2030.
As part of a multi-pronged approach, he said the Government would work with households, businesses, Indigenous communities and farmers to achieve its aim.
Its planned intiatives included energy efficiency programs and an electric vehicle strategy.
"We're also committed to continue the work on cleaning and greening our communities through land care and other community grants to support local communities taking practical action to reduce emissions, improve air quality and water quality and protect the environment and make Australians healthier," he said.
In 2014, Mr Abbott established the Emissions Reduction Fund for a range of carbon abatement programs, from vegetation management to energy efficiency and transport.
"I want to focus on our ongoing plan to address climate change, with practical solutions that reduce carbon emissions, while preserving our economic strength and living standards," Mr Morrison said.
"Because as Liberals and Nationals we don’t believe we have to choose between our environment and our economy - this is not an approach that a sensible Government like ours embraces."
Labor's climate change spokesman Mark Butler dismissed the funding injection as a continuation of a failed policy, vowing to scrap the scheme.
"These sorts of activities should be paid for by the private sector," Mr Butler told ABC radio.
"If you're serious about climate change then what you would do as a Prime Minister is dump their plans to spend even more billions of taxpayer dollars on funding coal fired power stations."
Labor is promising a 45 per cent emissions target by 2030, based on 2005 levels, if elected. It's also promising $10 billion for the Clean Energy Finance Corporation to invest in renewable energy and energy efficiency across Australia.
The prime minister believes the higher targets would come at a "tremendous cost".
"A cost far worse than the carbon tax Labor said they wouldn't introduce, but they did and our government had to abolish," the prime minister will say.
The Morrison government's package would include a suite of projects assisting remote Indigenous communities reduce the number and level of severe bushfires in rural and remote communities. Provisions will also be put in place to assist small businesses replace lighting, air conditioning and refrigeration systems to help reduce energy costs.
Farmers will also be "supported to revegetate degraded land and drought proof farms", while extra support will be dedicated to helping communities reduce waste and boost recycling rates.
"Our approach is to take care of our environment but also take responsibility to ensure we acknowledge, understand and manage the consequences of our decisions," Mr Morrison will say.
"We acknowledge and accept the challenge of addressing climate change, but we do so with cool heads, not just impassioned hearts."
Australia has committed to reducing emissions to 26-28 per cent on 2005 levels by 2030, a milestone the federal government insists it's on target for.
However, several quarterly emissions reports state the country’s greenhouse gas emissions are actually tracking upwards and Australia continued its trend of annual increases for the past four years to June 2018, according to the Global Carbon Project's December report.
The federal government's 2018 emissions projections project, published in December, estimated total emissions in 2030 will be 563 million tonnes of carbon dioxide equivalent - about 7 per cent of 2005 levels, and well short of the 26-28 target set out under the Paris agreement.