EnergyAustralia settled a greenwashing case over its 'carbon neutral' Go Neutral product

EnergyAustralia's Go Neutral product, sold since 2016, let customers buy carbon offsets against the emissions of their electricity and gas — power and heat that remained 'sourced predominantly from fossil fuels'. In 2023 the parents' group Parents for Climate took the company to the Federal Court, alleging misleading or deceptive conduct: customers were led to believe their fossil consumption was being neutralised by renewable projects. The matter was set down for hearings in May 2025.

Instead of fighting, the company settled with a public statement that read like a retraction. EnergyAustralia 'acknowledges that carbon offsetting is not the most effective way to assist customers to reduce their emissions', conceded that 'offsets do not prevent or undo the harms caused by burning fossil fuels', and apologised 'to any customer who felt that the way it marketed its Go Neutral products was unclear'. Chief customer officer Kate Gibson said offsets 'should not be used to delay or diminish' decarbonisation, and the company said it had shifted to direct emissions reductions.

It was, according to the applicants, the first case in an Australian court over 'carbon neutral' marketing — and it ended a product, not just a claim. EnergyAustralia stopped offering Go Neutral in mid-2024 and is phasing it out for residential customers through 2025. Parents for Climate CEO Nic Seton called the outcome 'a historic acknowledgement' that would 'set a new standard for the way carbon offset products are used by corporations and sold to consumers'.

No fine: the price was a Federal Court settlement, a public apology and admission, and the wind-down of a product line sold since 2016.

The product put a 'carbon neutral' label on energy still generated predominantly from fossil fuels.

Customers understood the label to mean their consumption was neutralised — the exact belief the offsets could not deliver.

The company's own settlement wording concedes offsets do not undo fossil burning and 'this could have been made clearer to customers'.

The scheme ran from 2016 into the 2020s, years after offset efficacy became a live public controversy.

Offset labels on an unchanged fossil product invite the honest question the label cannot answer; the fix that survives scrutiny is cutting emissions, not rebranding them.

The settlement statement stands in place of the corrective notice Parents for Climate sought, and the court hearings set for May 2025 fell away. EnergyAustralia says it is now focused on helping customers directly reduce the emissions tied to their energy use, continued phasing Go Neutral out of residential offerings through the year, and says it is shifting investment to direct emissions reductions. The applicants say the case will shape how carbon-offset products are marketed in Australia from here.