The Climate Institute is criticising the Federal Government's decision to delay the introduction of an emissions trading scheme (ETS).
Prime Minister Kevin Rudd says the Government will now wait until the end of 2012 before deciding what to do.
He blames the decision on slow international progress and the Coalition's determination to block the bill in the Senate.
The founder of the Climate Institute, Hamilton farmer Mark Wootton, says it is an irresponsible move.
"We think the decision to shelve the CPRS [Carbon Pollution Reduction Scheme] is extremely concerning, it's economically reckless and environmentally reprehensible," he said.
"It'll leave Australia behind other people, it'll leave us isolated, it'll make us a lot less competitive, it'll also make us the laughing stock in terms of other developed countries."
The executive director of the Minerals Council's Victorian division, Chris Fraser, says he is pleased the Government has mothballed the scheme.
"We're pleased because the current CPRS is a flawed system. It was a flawed system. It was never, never ever, going to work and thank goodness commonsense has prevailed," he said.
Environment Victoria spokesman Mark Wakeham says the Federal Government has compromised its environmental credentials by delaying action to reduce carbon emissions.
"It continues pollution as usual for the next three years. The Rudd Government was elected on a mandate to take climate change seriously and to reduce emissions," Mr Wakeham said.
"They're not delivering on that mandate and they're going to have to look Australians in the eye at an election later this year and explain what they're going to do to reduce emissions."