Fears that households will suffer under a future Carbon Trading Scheme, will be addressed by the federal government.
A new report shows Australia is on track to meet its Kyoto target of reducing carbon emissions by 60 per cent by 2050,
The government says more needs to be done, with a 1.6 per cent increase in green house gas emissions over the last year.
Big companies will be penalised under a new emissions trading scheme penalties if they over-pollute.
It could send electricity and petrol prices through the roof.
But Climate Change Minister Penny Wong says households will be compensated for any additional costs.
Video: John Barrington