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Kevin Rudd's Climate Troubles

The Rudd government's "softly-softly" 5% targets have been roundly condemned by NGO's, climate scientists - and also by Ross Garnaut...

Weeks before the Rudd government's White paper on Climate change - the government response to Prof Ross Garnaut's Climate Change Report - became public, rumblings started to emerge. Rudd, it was said, was in a political dilemma.

Cartoons: thanks to Peter Nicholson cartoons

Discerning citizens around Australia already knew as far back as during the April 2008 2020 Summit, that the Climate section was 'booked out' by the power and energy companies - strong representations of Xstrata and Shell were made, while there seemed an absence of those organisations in Australia who had been pushing and developing Australia's awareness of climate change: Friends of the Earth, the Australian Conservation Foundation, Greenpeace, Climate Action Network Australia or any of the State Conservation Councils.

"The modest cuts for 2020 are seen as marking a fork in the road in Australia's approach to climate change, with the Government proceeding down one route and the research that underpins the need for emissions cuts heading down another."

"There's now a disconnect between what politicians are doing and what the science requires"

Prof Barry Brook, Research Institute for Climate Change and Sustainability

So it should not be surprising that when the White paper eventually came out, condemnation was swift, came from all around, and reduced the minister, Senator Penny Wong, to spin and soothing but practiced lines in the media.

That was not the end of the story though. This page also includes news that the head of NASA's Goddard Institute for Space Studies, Professor James Hansen, wrote an open letter to Barack Obama about Kevin Rudd and Penny Wong's targets.

What's on this page

This page compiles "all the news" around the publication of the Rudd government's climate pollution reduction targets - including the "saturation media coverage" on December 16, 2008, the first day in the life of the white paper, and it includes the more in-depth commentary and analysis from the Australian media.

Rudd and Wong's political message was that only the "extreme left" would attack the plan for not doing enough. But the "extreme left" includes former United States vice-president Al Gore, the head of the UN's Nobel-winning scientific panel, Dr Rajendra Pachauri, and the former World Bank chief Nicholas Stern.

"Australia exports coal and sets atmospheric carbon dioxide goals so large as to guarantee destruction of much of the life on the planet"

Prof James Hansen, NASA's Goddard Institute for Space Studies

"...disappearance of the Great Barrier Reef "as we know it, with high impact to reef-based tourism", collapsing biodiversity in many districts, major changes to the tropics and Kakadu National Park and a cut of 20 per cent to food production along the Murray-Darling system."

Several respected scientists believe the Arctic sea will soon be ice-free in summer. Their guesses range from 2011 to 2015, 80 years ahead of IPCC predictions. This could spark a series of events that end with Greenland's ice melting and many metres of sea level rise.

...two leading climate thinkers -- NASA's James Hansen and Al Gore -- say carbon dioxide concentrations in the atmosphere should be stabilised at 350 parts per million. We are now at 385 ppm, so this means not just a zero-emissions economy, but sucking down existing carbon. Right now the world is struggling to agree on 450 ppm.

Related pages

5 July 2008: Will Ross Garnaut's verdict become Kevin's Slow Boat to China? - Professor Ross Garnaut has delivered his long awaited Climate Change Draft Report, and now it's up to the Rudd government to prepare the action and implement the policies. Will Professor Ross Garnaut force Kevin Rudd's climate change leadership, or will it be silently 'averaged out' in Canberra? This page summarizes the early impressions.

1 July 2008: Climate Change: Catastrophic Impacts and Human Rights - by HREOC President John von Doussa QC: "Australia's response to climate change must be human rights compliant. What is also clear is that the international standards and norms that these rights establish themselves provide guidance to decision makers on the substantive elements of legislative and policy responses to climate change."

20 June 2008: The Gristmill: How to Talk to a Climate Skeptic - Every now and then a remarkable online resource deals with an issue so well, that nothing more needs to be added to the topic. That was also the case with the comments provided by guest contributor to the Gristmill, Coby Beck, on the issue of How to Talk to a Climate Skeptic. Here's the table of links to all related issues.

8 May 2008: UN Human Rights Commission offers Human Rights to Climate Refugees - Three reports about the United Nations Human Rights Council resolution to recognise issues connected to climate change as having a human rights framework, as well as a picture by Reuters and the Reuters Alertnet about political manipulation of climate refugees and six FAQs about climate refugees.

22 April 2008: The 2020 Summit: Coal Industry Chiefs overheat Kevin's Climate - "I found myself in the climate stream with representatives of coal mining companies including Xstrata and Shell, yet not a single person from an environment Non-Government Organisation. No-one from Friends of the Earth, the Australian Conservation Foundation, Greenpeace, Climate Action Network Australia or any of the State Conservation Councils."

21 March 2008: The Garnaut Climate Change Review Interim Report - Hasn't Australia changed radically in just a few months: under the former government Ross Garnaut, who has just released his Interim Climate Change Review Report, would have been stonewalled, ignored, vilified and sidelined, and Canberra would have followed a lead from industry on its opinion about him. Now he receives appause from the environmental lobby while big energy producers cringe...

Australia 'destroying life on Earth'

By Sean Plambeck
January 06, 2009 05:15pm

Australia's use of coal and carbon emissions policies are guaranteeing the "destruction of much of the life on the planet", a leading NASA scientist has written in a letter to Barack Obama.

The head of NASA's Goddard Institute for Space Studies, Professor James Hansen, has written an open letter to Barack Obama calling for a moratorium on coal-fired power stations and the use of next-generation nuclear power.

In the letter he says: "Australia exports coal and sets atmospheric carbon dioxide goals so large as to guarantee destruction of much of the life on the planet."

Prof Hansen said goals and caps on carbon emissions were practically worthless because of the long lifetime of carbon dioxide in the air.

"Instead a large part of the total fossil fuels must be left in the ground. In practice, that means coal," he wrote.

"Nobody realistically expects that the large readily available pools of oil and gas will be left in the ground."

Prof Hansen said that emissions reduction targets, like Kevin Rudd's goal to cut emissions by a minimum of 5 per cent and up to 15 per cent by 2020, do not work.

"This approach is ineffectual and not commensurate with the climate threat," he wrote of reduction plans.

"It could waste another decade, locking in disastrous consequences for our planet and humanity."

Professor Hansen also works in the Department of Earth and Environmental Sciences at Columbia University and has given testimony on climate change to the US Congress.

He said he wrote to Mr Obama as the incoming US president is in a position to instigate global change and "his presidency may be judged in good part on whether he was able to turn the tide (on climate change) - more important, the futures of young people and other life will depend on that".

He called for the end of coal plants that do not capture and store carbon dioxide and for funding for "fourth generation" nuclear power plants that could run on material now regarded as waste.

Comment is being sought from climate change minister Penny Wong.

Read the full version of Prof Hansen's letter here.,27574,24880012-29277,00.html

Ross Garnaut: Australia counts itself out

The Age
Ross Garnaut
December 20, 2008

Kevin Rudd's Climate Forecast

In the course of the work on climate change, members of the Garnaut Climate Change Review team would sometimes ask how, when the work and the responses to it were all over, we would judge whether our efforts had been successful. Would the main indicator be the extent to which the Australian Government accepted the final report's main recommendations?

"No," I would respond. "Policy decisions will reflect a range of pressures and constraints about which we are not now in a position to assess, and about which the Government is elected to form judgements. We will have done our job if the Australian community and Australian governments understand the implications of decisions that are taken."

Whatever the pressures and constraints that have shaped the white paper, the policy decisions embodied in it have implications for the environment and the economy.

The policy proposals in this week's white paper, should they become law, will be historic. The embodiment of the white paper proposals in law would mark the beginning of comprehensive action in Australia to mitigate the growth in Australian greenhouse gas emissions. Australia would have taken a step at which several other countries have stumbled. It would have taken this step in difficult times for the domestic and international economy. It would have taken this step in the context of the most pervasive pressure on the policy process from vested interests since the Scullin government, and of the most expensive, elaborate and sophisticated lobbying pressure on the policy process ever in this country. It will have taken this step in the face of resistance from Her Majesty's Opposition.

The white paper has been greatly criticised by environmental groups for its "soft targets".

The review recommended, and I support, the most widely and strongly condemned of the "soft targets"--the commitment unconditionally to reduce greenhouse gas emissions by 5 per cent from 2000 levels by 2020.

It costs much more to reduce emissions in isolation than in the context of global action. Action in isolation does almost nothing in itself to solve the environmental problem. The purpose of acting at all in the absence of comprehensive global agreement is to keep alive the hopes of eventual effective global agreement. Australian emissions are currently significantly above 1990 levels. 2020 is not far away. Our population grows strongly, because we, for good reasons, have chosen to keep our doors open to people from many lands. Our new citizens need transport, a home with the Australian accompaniments, and access to income from employment, all of which generate greenhouse gas emissions. The white paper's unconditional target is a challenging one in the absence of an international agreement. To go further would run the risk that Australia's example of early action would be negative rather than positive in its influence on others.

The white paper's proposed conditional targets are more problematic.

The review proposes a formula for assessing comparability of effort of various countries towards effective global efforts embodying various degrees of ambition. Within a global effort to hold concentrations at 450 parts per million (ppm), Australia's proportionate share of the effort would reduce emissions entitlements to 25 per cent of 2000 emissions by 2020, and 90 per cent by 2050. Within a global effort to hold concentrations at 550 ppm, Australia's proportionate share would be to reduce entitlements for 2020 by 10 per cent from 2000 levels, and entitlements for 2050 by 80 per cent.

The review analyses the economic and environmental costs of global action to mitigate climate change, with Australia playing its full, proportionate part. It concludes that it is in Australia's interests to seek the strongest possible global mitigation outcome.

Australia should indicate its willingness to play its proportionate part in a global agreement to bring greenhouse gas concentrations back to 450 ppm, or eventually to lower levels. Should this not be possible, Australia should play its proportionate part in the best possible outcome. This may turn out to be an effective agreement on 550 ppm in the first instance. International success at this level of ambition would strengthen confidence in and support for stronger outcomes in subsequent negotiations.

The white paper proposes a variation on this theme. It proposes emissions reductions for Australia up to 15 per cent from 2000 levels, "in the context of global agreement under which all major economies commit to substantially restrain emissions and advanced economies take on reductions comparable to Australia". It proposes that, "in the event that a comprehensive global agreement were to emerge over time, involving emissions commitments by both developed and developing countries that are consistent with long-term stabilisation of atmospheric concentrations of greenhouse gases at 450 ppm or lower, Australia is prepared to establish its post-2020 targets so as to ensure it plays its full role in achieving the agreed goal".

The Prime Minister's speech to the National Press Club notes that Australia would have to reduce its emissions by more than 60 per cent by 2050 within a 450 ppm global agreement, and that he would seek a mandate at a general election to amend current policy as required.

The white paper refers extensively to the review on these matters. Policy Position 1.1 says: "The Government accepts the key findings of the Garnaut Climate Change Review, that effective global agreement delivering concentrations of greenhouse gases at around 450 parts per million or lower would be in Australia's interests"; that "achieving global commitment to emissions reductions of this order appears unlikely in the next commitment period"; and that "the most prospective pathway to this goal is to embark on global action ..." that "builds confidence". These sentences are repeated exactly as Policy Proposition 4.1, and twice elsewhere.

I did not actually use all of these words. However, pursuit of the approach proposed in the review may lead to the same end point as the white paper: Australia playing its full part in a global agreement to hold concentrations at 550 ppm or, say, 520 ppm, following Copenhagen, and its full part in a more ambitious agreement as that becomes possible after 2020.

And yet the white paper's variations on the review's themes matter.

The white paper rules out Australia contributing to a global effort to achieve ambitious mitigation targets prior to 2020. That is a pity. There is a chance, just a chance, that with Barack Obama as president of the United States, high ambition at Copenhagen will turn out to be feasible. In the meantime, Australia cannot play a strongly positive role in encouraging the global community towards the best possible outcomes if it has ruled out in advance its own participation in strong outcomes.

This weakness of the white paper could be corrected without substantial unpicking of the policy package.

The review argued that an effective global agreement including developing countries would need to allocate emissions entitlements on a per capita basis, converging to equal per capita entitlements at some time around the middle of next (sic: should be "this") century. This in itself would be favourable to Australia in comparison with the developed and transitional countries with low immigration and slow or negative population growth.

But we cannot expect our advocacy of a new and superior approach to allocating emissions entitlements across countries to be effective in the international community, if we accept only implications that favour us (taking population growth into account), but not other implications (converging towards equal per capita entitlements).

Three elements of the white paper proposals lead towards large transfers from the general community to particular interests, and to fiscal and environmental risks.

There is no public policy justification for $3.9 billion in unconditional payments to generators in relation to hypothetical future "loss of asset value".

Never in the history of Australian public finance has so much been given without public policy purpose, by so many, to so few. The best that can be said is that these are once-and-for-all payments -- unless the spectacular success of investment in lobbying inspires repetition and emulation.

There is large risk to the public finances in the five-year price cap for emissions permits. The cap is to be set at an Australian dollar price that is likely to be exceeded by international prices at some point in the first five years of the scheme. When that point is reached, the Australian taxpayer will have to fund the purchase of permits from other countries at international prices, and to underwrite the difference between the cap and international prices. At that point, there will be powerful commercial incentives for market participants to buy at capped prices and to hoard standard permits for future use or sale. This increases the fiscal risk.

The proposed issue of free permits to trade-exposed emissions-intensive industries raises different issues. Like free permits to generators and the price cap, it carries risks to the public finances -- in this case, of much greater dimension. Unlike the other instruments of transfer from the general community to particular instruments, it is based on a sound public policy objective.

The problems arise from the absence from the white paper of a sound conceptual basis for payments. Section 14.5 of the final report sets out the principle upon which payments should be made to trade-exposed industries: compensating firms for the effect that the absence of comparable carbon constraints in other countries has on sales prices. The white paper acknowledges that this is the correct principle, but does not seek to apply it.

The consequences of not having a principled basis for the issue of payments are profound.

Wherever the partial application of a carbon constraint in other countries is having an effect on international prices, there can be overcompensation of Australian producers. Carbon constraints are now being applied in many developed countries, including most states in the US, and in major developing countries including South Africa and China. They will increase in importance.

Sound principles would result in the automatic withdrawal of payments as carbon constraints emerge in other countries. With political bargaining determining payments, as in the white paper, there is no obvious point at which payments would be partially or completely withdrawn. Further, even if there were a comprehensive international agreement that removed the case for payments, five years' notice would need to be given for withdrawal.

The July green paper proposed placing a cap of 20 per cent on value of permits issued to trade-exposed enterprises outside agriculture, or 35 per cent including agriculture. As indicated in the final report, these are reasonable upper limits to principled initial claims.

A principled approach to payments to trade-exposed industries would generate an early and continuing decline in the proportion of payments to trade-exposed industries as carbon constraints were extended elsewhere. By contrast, the white paper's approach would result in the proportion of permit value given free to trade-exposed industries rising to 45 per cent in 2020 on restrictive assumptions.

The ratio would rise well beyond 45 per cent if trade-exposed sectors grew more rapidly than the rest of the economy, or if reductions in emissions were greater than 5 per cent.

The ratio could rise to 65 per cent with an emissions reduction target of 15 per cent and with trade-exposed industries growing twice as rapidly as the rest of the world. With similar relative growth rates and an emissions reductions target of 25 per cent, three-quarters of permit value would be transferred to trade-exposed industries.

And yet the revenue pool from sale of permits is exhausted at 45 per cent by the household compensation arrangements proposed in the white paper. Already there is nothing left for increases in payments to households as the carbon price rises over time. Little is left for incentives for research, development and commercialisation of low-emissions technologies, which are essential components of the domestic and international mitigation efforts. Nothing is left for systematic support for overcoming information and contractual market failures inhibiting energy-saving in low-income households.

What happens as the claims of the trade-exposed industries rise above 45 per cent? To the extent payments to trade-exposed industries deviate from those that are necessary to compensate for the absence of carbon constraints in other countries, they introduce distortions into international trade.

One justification for unexpectedly high payments to trade-exposed industries in both Europe and Australia -- and presumably other countries one by one -- is the global recession.

The Smoot-Hawley tariff in the US in the 1930s, and the competitive increases in protection in other countries that it inspired, made the Great Depression much deeper than it would otherwise have been. Will the treatment of trade-exposed industries become the Smoot-Hawley tariff following the Great Crash of 2008?

The introduction of a sound basis in principle for trade-exposed industries is an urgent matter for the restoration of global prosperity, as well as for Australian fiscal integrity, and for the avoidance of high risks of dangerous climate change.

Professor Ross Garnaut is the Federal Government's climate adviser.

Garnaut slams climate plan

The Age
Michelle Grattan
December 20, 2008

Ross Garnaut has launched a scathing attack on the Government's emissions trading policy, condemning its failure to embrace a more ambitious goal and the multibillion-dollar compensation for electricity generators.

In his first intervention after Monday's unveiling of the Government's blueprint, Professor Garnaut -- the Government's climate guru -- said last night that the plan would get "5˝ out of 10 at a good university".

Writing in today's Age, he says it makes large transfers of money "from the general community to particular interests", and warns of its fiscal and environmental risks.

There is "no public policy justification for $3.9 billion in unconditional payments to generators" for hypothetical future loss of asset value.

"Never in the history of Australian public finance has so much been given without public policy purpose, by so many, to so few," he writes. "The best that can be said is that these are once-and-for-all payments -- unless the spectacular success of investment in lobbying inspires repetition and emulation."

But he does endorse the Government's unilateral target of a 5 per cent reduction on 2000 levels by 2020, which is in line with his review.

But that review said a 25 per cent target should be kept on the table in the slight hope of a comprehensive international agreement. The Government says it won't consider such a target until after 2020. The review was also much tougher than the white paper in proposals to compensate industry.

Professor Garnaut urges the Government to rethink its position on the 25 per cent target before next year's Copenhagen climate conference, especially if the Obama presidency and China's response bring hope of an unexpected breakthrough.

"Australia cannot play a strongly positive role in encouraging the global community towards the best possible outcomes if it has ruled out in advance its own participation in strong outcomes," he writes.

He warns that high payments for trade-exposed industries in both Europe and Australia, and presumably other countries, justified on the grounds of the international financial crisis, could serve to worsen the downturn -- as happened when the US and other countries raised protection in the 1930s, deepening the Great Depression.

Professor Garnaut points to large risks to public finances in the five-year price cap for emissions permits and in the issuing of free permits to trade-exposed emissions-intensive industries, although he says the permits are based on sound policy.

"The problems arise from the absence from the white paper of a sound conceptual basis for payments," which has profound consequences, he writes. "Sound principles would see the automatic withdrawal of payments as carbon constraints emerge in other countries.

"With political bargaining determining payments, as in the white paper, there is no obvious point at which payments would be partially or completely withdrawn." Even if there was an international agreement that completely removed the case for payments, five years' notice would need to be given for withdrawing them.

Professor Garnaut said last night the "next reforming Australian government will have as its central objective the removal of the distortions in the ETS' trade-exposed industries".

He said the scheme would have been better if it had taken on more of his proposals.

Supporting the 5 per cent unilateral target, he writes that this is a challenging target in the absence of an international agreement. "To go further would run the risk that Australia's example of early action would be negative rather than positive in its influence on others."

The heat is on over policy

The Age
Adam Morton
December 20, 2008

Ross Garnaut is a former Labor adviser and diplomat, but old allegiances and professional habits mean little when 18 months work is being undermined for short-term political ends. And when you believe so much is at stake.

The veteran economist has taken a baseball bat to the Labor Government's climate change package, effectively accusing the Government of abandoning efforts to secure a substantial global climate change deal before 2020.

Roughly translated, his message can be broken into three key points. First, a global deal to limit climate change is in Australia's interests. Why would it not put up a target that might achieve that -- a 25 per cent cut as part of a deal to stabilise carbon dioxide at 450 parts per million, as recommended by climate scientists -- even if it thought an agreement at this level was unlikely?

With Barack Obama in the White House, there is a small chance that a substantial deal is possible. Unless it shifts, Australia has ruled out being part of it.

Second, the Rudd Government arrogantly wants a global deal designed to its own specifications. It wants per capita emissions taken into account because Australia's projected population growth justifies a smaller target than stagnant Europe. But the per capita argument is a two-sided coin: Australia has the largest per person emissions in the developed world, and must ultimately make much deeper cuts if all countries are to converge to the same level.

Third, there is no justification for giving billions of dollars to coal-fired power plants. The failed first European emissions scheme did this, and the big polluters just pocketed the cash and passed the extra carbon cost on anyway. Similarly, its formula for compensating trade-exposed industries is unprincipled and determined by politics.

Much of Garnaut's criticism can be boiled down to the disconnection between Government rhetoric about taking a lead in finding a global solution to climate change and the defensiveness of its white paper.

Foreign governments share this concern. A senior European official this week told The Age that Australia was acting as if this was just another trade negotiation, where everyone puts up its defensive position while preparing to carry on if no agreement is reached. Unfortunately, as anyone who has paid even passing attention to Garnaut this year could tell you, climate science doesn't work this way.

Great Barrier Reef: Coral reef growth is slowest ever

BBC News | Asia-Pacific
Friday, 2 January 2009
By James Morgan
Science reporter, BBC News

Coral growth in Australia's Great Barrier Reef has slowed to its most sluggish rate in the past 400 years.

The decline endangers the species the reef supports, say researchers from the Australian Institute of Marine Science.

They studied massive porites corals, which are several hundred years old, and found that calcification has declined by 13.3% since 1990.

Global warming and the increasing acidity of seawater are to blame, they write in Science journal.

Coral reefs are central to the formation and function of ecosystems and food webs for tens of thousands of other marine organisms.

The Great Barrier Reef is the largest in the world, composed of over 2,900 individual reefs and 900 islands.

Dr Glenn De'ath and colleagues investigated 328 colonies of massive Porites corals, from 69 locations.

The largest corals are centuries old - growing at a rate of just 1.5cm per year.

By looking at the coral skeletons, they determined that calcification - or the deposit of calcium carbonate - has declined by 13.3% throughout the Great Barrier Reef since 1990.

Such a decline is unprecedented in at least the past 400 years, they write.

The researchers warn that changes in biodiversity are imminent, both at the Great Barrier Reef and at other reef systems throughout the world's oceans.

Our planet is in peril: the time for patience is past

The Age
Melissa Fyfe
December 28, 2008

Patience is a virtue, they say. And when it comes to climate change, voters are inordinately virtuous. Mums and dads, community groups and environmentalists have waited patiently for our modern political processes and leadership to produce some action.

They waited through Kyoto, Bali, Poznan. They waited at polling booths to elect a prime minister who said he would do something. They waited for Ross Garnaut and his several reports. They wrote submissions, went to public meetings. They waited for Treasury modelling and the federal green paper.

Then, two weeks ago, Kevin Rudd blinked. You could hear the anger at his carbon plan crackling over the airwaves. With its low targets, Australia had decided not to lead the way in the hope China and India may follow. The scheme gave cash instead of energy efficiency help for households, huge compensation to polluters and a get-out clause for Australia to buy overseas permits instead of making its own hard cuts. Then, to top it all off, Climate Change Minister Penny Wong said she doubted a strong global agreement would be struck in Copenhagen next year.

In the past fortnight, something has dawned on people who care about climate change: perhaps it is time to acknowledge that too much faith has been put in the political process. If those who fought for the Franklin River acted like such compliant "stakeholders", the river would now be dammed.

Perhaps it is time to realise our democratic system has an entrenched inertia that makes it almost impossible to deal with a long-term crisis like climate change. It is partly a vacuum of leadership: the three-year electoral cycle means leaders have short-term vision. This is not new. But what the white paper process showed was how our system can be so thoroughly corrupted by lobbying -- Garnaut described the polluters' efforts as "the most expensive, elaborate and sophisticated lobbying ... ever in this country".

In the wake of Rudd's decision, some in the environment movement are talking about a return to people power. They are talking not just about individual action but national campaigns of "direct action": protests, civil disobedience, making life hard for coal-fired power stations. They are talking about moving out of the boardroom and back to front-line action. They know that they will be risking jail. But their patience has run out. "Until now the sentiment was to give Rudd a fair go to deliver. He's now had that time and hasn't delivered," one senior activist said. "I think there will now be a place for radical action, particularly among young people who feel their future is being taken away."

A similar shift is happening globally. As the Crikey website mentioned recently, a man managed to walk into a British coal and oil-fired power station and shut down a whole turbine. "No new coal" was on the note he left.

Much has been written about the groundswell of small, local climate groups. This movement, often led by concerned mothers, shows climate change is moving away from a traditional environmental issue to one that is fundamentally about morality, about not handing a crisis to our children. Rudd ignores this movement at his political peril, although Labor knows the Opposition is unlikely to outgun them on climate. But what should not be underestimated is the anger that will simmer among these groups when they are busting a gut to fight carbon pollution within their communities, only to see this undermined by the Government on the world stage and in cosy deals with industry.

This anger will boil over when the latest science starts to filter down. Garnaut's review, Rudd's decision and the Copenhagen meeting are all based on findings from the Intergovernmental Panel on Climate Change. This science is now two years' old. For scientists, the biggest game in town is now the loss of Arctic summer sea ice. The domino effect of this development was described by Britain's Public Interest Research Centre in a report called Climate Safety, endorsed by a former IPCC co-chairman.

Several respected scientists believe the Arctic sea will soon be ice-free in summer. Their guesses range from 2011 to 2015, 80 years ahead of IPCC predictions. This could spark a series of events that end with Greenland's ice melting and many metres of sea level rise.

It is partly because of these "tipping points" that two leading climate thinkers -- NASA's James Hansen and Al Gore -- say carbon dioxide concentrations in the atmosphere should be stabilised at 350 parts per million. We are now at 385 ppm, so this means not just a zero-emissions economy, but sucking down existing carbon. Right now the world is struggling to agree on 450 ppm. It may be a virtue, but the time for patience has probably run out.

Melissa Fyfe is The Sunday Age's state political reporter.

Greenpeace, WWF damn paper on climate change

Sydney Morning Herald
Stephanie Peatling
December 16, 2008

The Federal Government's white paper on climate change received only muted praise from industry but outright hostility from the environment movement.

Environment and community groups reacted angrily. Sixty of them joined to condemn the Government's target range.

The range of between 5 and 15 per cent was "a total failure of climate policy and shows that the Rudd Government has caved in to pressure from the big polluters", the groups, including Greenpeace and WWF, said.

"If adopted globally this target would guarantee the loss of the Great Barrier Reef and the Kakadu wetlands and steer the Earth on a path towards catastrophic climate change."

The executive director of the Australian Conservation Foundation, Don Henry, said the Government had "given up on our much-loved and important natural icons".

Mr Henry was also concerned about the billions of dollars in industry assistance guaranteed by the Government that he said came with "virtually no strings attached".

"This could herald a new era of pollution protectionism," Mr Henry said.

The Australian Council for Social Service said it was unhappy with the targets but welcomed the help for low- and middle-income families.

The chief executive officer of the council, Clare Martin, said the Government should investigate retrofitting homes of people on low incomes.

"The retrofit would significantly increase household energy efficiency and could include upgrades of basic equipment such as hot water systems and refrigerators to best practice performance standards in low-income households," Ms Martin said.

Response from business was mixed. Many companies said the Government had not offered enough assistance.

The executive director of the Australian Industry Group, Heather Ridout, said the white paper was "a positive compromise but a stretch nonetheless".

"The challenges for business will be exacerbated by the fact that they will have to be met at a time when businesses are being called on to manage their way through an unparalleled global economic crisis and unprecedented domestic economic uncertainty."

The executive director of the Australian Coal Association, Ralph Hillman, said coal companies should be given the same protection as aluminium and cement companies.

"It is in Australia's best interests to ensure the coal industry is not disadvantaged compared to its competitors in countries that aren't planning to impose the same carbon limits," Mr Hillman said.

The Business Council of Australia said it appeared many of its concerns about the so-called emissions-intensive companies - which risk losing business to overseas competitors - had been addressed.

Scientists predict a hot and bleak future

Sydney Morning Herald
Ben Cubby, Environment Reporter
December 16, 2008

Some climate scientists have turned on the Federal Government, calling for "scientific honesty" after it delivered its target range for emissions cuts of between 5 and 15 per cent yesterday.

The mainstream scientific community believes much deeper cuts are needed more quickly and that yesterday's announcement all but locks Australia into a hot and rather bleak future.

The modest cuts for 2020 are seen as marking a fork in the road in Australia's approach to climate change, with the Government proceeding down one route and the research that underpins the need for emissions cuts heading down another.

"There's now a disconnect between what politicians are doing and what the science requires," Professor Barry Brook, director of the Research Institute for Climate Change and Sustainability at the University of Adelaide, said. "Targets in that range [5 to 15 per cent] are politically realistic but not scientifically realistic.

"Just talking about emissions cuts at these small levels is avoiding the main point, which is that we're already over the limit. Let's have a bit of scientific honesty in the debate."

The Prime Minister, Kevin Rudd, attempted to claim the middle ground in his speech to the National Press Club yesterday, saying that people on the "extreme" ends of public debate would be unhappy with the Government's position.

Carbon cuts from 25 to 40 per cent on 1990 levels are required by 2020, along with an international agreement that ties major polluting nations to similar cutbacks, are needed to ward off the worst effects of climate change, according to the Government's Garnaut climate change review.

That report concluded that allowing the concentration of greenhouse gases in the atmosphere to rise to 550 parts per million, which is what the Government's cuts will mean if other nations make similar modest moves, would be disastrous for Australia.

It would mean the disappearance of the Great Barrier Reef "as we know it, with high impact to reef-based tourism", collapsing biodiversity in many districts, major changes to the tropics and Kakadu National Park and a cut of 20 per cent to food production along the Murray-Darling system.

Dr Barrie Pittock, a lead author of the Intergovernmental Panel on Climate Change's fourth assessment report, said the targets announced would fall short of the safer level of 450 parts per million.

PM baulks at crossroads of history

Sydney Morning Herald
Marian Wilkinson, Environment Editor
December 16, 2008

"Our generation stands at the crossroads of history," the Prime Minister, Kevin Rudd, declared yesterday at his climate change launch, asking emotively: "Do we wait, knowing our grandchildren may never see the grandeur of the Great Barrier Reef'?"

Well, maybe, is the answer woven through the carbon pollution reduction plan, released to the muted applause of industry and the condemnation of the environment movement.

Rudd and his Climate Change Minister, Penny Wong, are strenuously arguing they have the balance right in their plan that sets a 2020 target to cut Australia's greenhouse emissions well below the figure called for at the United Nations climate negotiations and by many climate scientists.

The Government's cuts of between 5 and 15 per cent below 2000 emissions levels are an admission it has given up on an ambitious global climate change agreement coming out of the UN talks next year. Figures in the Garnaut review clearly show that Australia, along with other developed countries, would have to take on cuts of at least 25 per cent to get an agreement in Copenhagen that might have a chance of saving the Great Barrier Reef.

The UN's scientific body believes the 2020 target for developed countries should be cuts in the range of 25 and 40 per cent below 1990 emissions to keep the global temperature rising above two degrees and avoid dangerous climate change. This, along with slowing the emissions from developing countries, is required to keep global greenhouse gas concentrations at about 450 parts per million and achieve an ambitious climate agreement.

Rudd argued Australia still wanted an "ambitious" climate agreement that would deliver this result, but significantly, he puts it "in the future" - not, it seems, during the UN climate negotiations.

Rudd has sent a firm message that he will not accept a 2020 target of 25 per cent or more for Australia in the UN negotiations. He and Wong are prepared to justify their lower 2020 target, arguing a 15 per cent target is equivalent to the 30 per cent target being offered by the Europeans - if it is calculated per head of population.

But prosecuting this argument at the UN will be very difficult. Australia is already the largest emitter of greenhouse gases per head of all the developed countries. Asking for a special deal to compensate Australia for its poor greenhouse record will be a tough ask.

And, as the emissions expert Dr Hugh Sadler points out, the per head figures released by Rudd are based on only an estimated 45 per cent increase in Australia's population between 1990 and 2020. On this reasoning, Sadler said, China would be penalised in the negotiations for slowing its population growth.

Rudd and Wong's political message was that only the "extreme left" would attack the plan for not doing enough. But the "extreme left" includes former United States vice-president Al Gore, the head of the UN's Nobel-winning scientific panel, Dr Rajendra Pachauri, and the former World Bank chief Nicholas Stern.

Cautious Rudd blinks on greenhouse action

The Age
Michelle Grattan and Tim Colebatch
December 16, 2008

Carbon polluters have won big concessions and the economy will bear only modest costs under an emissions trading scheme designed by the Federal Government to win the backing of the Senate.

In a plan denounced by environmentalists and criticised by industry, Australia will cut its emissions unilaterally by 5 per cent from 2000 levels by 2020. The Government has promised to go to 15 per cent if other major emitters play ball in next year's international climate negotiations.

A coalition of more than 60 environment and community groups attacked the plan as "simply unacceptable", saying that if it were adopted globally it would "guarantee the loss of the Great Barrier Reef and the Kakadu wetlands".

The Greens and the Climate Institute also lashed out, while business reaction varied from fearful to muted.

With the Government looking first to the Coalition to try to get its scheme through the Senate, the Opposition is keeping its options open, commissioning its own economic analysis. On Treasury estimates, households will face an average $4-a-week rise in electricity costs and a $2 increase in gas and other household fuel, with the scheme adding 1.1 per cent to the cost of living and slicing only one-tenth of 1 per cent off the economy's annual growth.

The Government will raise $11.5 billion a year from selling carbon permits to emitters, but promises to return $6 billion of that in compensation to households, $2 billion to motorists and the rest to businesses. Welfare recipients and other low-income earners will get full compensation or more.

About 2.9 million low-income households have been promised at least 20 per cent more than the scheme would cost them. About 97 per cent of middle income households -- defined to include families earning up to $160,000 -- will receive some direct cash assistance, but highincome earners will have to pay the full cost. Motorists will be protected for three years by equivalent cuts in fuel tax.

Prime Minister Kevin Rudd launched the plan in a speech disrupted by three protesting environmentalists. As the Prime Minister ploughed on, ignoring the drama, Greens leader Bob Brown told one of the women: "You're a real Australian."

Mr Rudd said climate change "is an inconvenient truth and a truth that we can no longer conveniently ignore".

He rejected the argument that the Government had sold out by not embracing a 25 per cent cut by 2020 -- in effect writing off the chance of a comprehensive international agreement in Copenhagen next year.

In the unlikely event of such a deal, Australia would adjust its cuts beyond 2020 to accommodate the 25 per cent goal. "Australia, in the negotiations, will be ambitious and working hard to bring about a maximalist agreement," he said, leaving open the possibility he will go to the Copenhagen conference. Mr Rudd said the Government had "listened closely" to the concerns of business and improved the scheme since the green paper earlier this year.

The total level of assistance to emissions-intensive tradeexposed industries has been massively increased. Petrol refining and liquid natural gas are among 40 industries now expected to qualify for free permits covering most or almost all of their output. The Government will offer almost $4 billion over five years to compensate the owners of coal-fired power stations for the loss of their asset value, recognising that some -- particularly in the Latrobe Valley--could be forced to shut down early.

The unconditional target to reduce total emissions by 5 per cent would represent a cut of 27 per cent per head between 2000 and 2020, and a 34 per cent cut from 1990. Legislation for the scheme will be put up next year for a July 2010 start.

Seeking to put the pressure on the Opposition Leader, Mr Rudd said it was "time for the real Malcolm Turnbull to stand up. Is it the Malcolm Turnbull who was supposed to be gungho about this 12 months ago or is it the Malcolm Turnbull of today seeking some short-term political advantage?" The Opposition declined totake a stand yesterday. "We will approach this with an open mind on targets and on start dates," said Coalition climate change spokesman Andrew Robb.

But he said the Opposition would examine the plan "very critically", looking at whether Australian jobs would be at risk.

The Opposition has argued that an emissions trading scheme should not start before 2011 and probably by 2012. Its review will be conducted by the Centre for International Economics, and its executive director, David Pearce, an economist who has worked on climate change issues.

Business was ambivalent at best, negative at worst. While the Business Council acknowledged that "the Government has taken into consideration many of our concerns", the Australian Chamber of Commerce and Industry was unequivocal.

"Introducing the scheme unilaterally and at a time when our economy is trying to stare down a global economic recession is too high a risk," said the chamber's chief executive, Peter Anderson. The Greens were even more hostile. Senator Brown called the 5 per cent target "a global embarrassment and a recipe for global catastrophe . . . It is exactly where John Howard would have placed Australia in 2009."

Environment groups were incredulous. Climate Institute chief executive John Connor said the Government had "buckled to the short-term interests of selfish business voices", leaving itself with a "credibility deficit" with voters.

Victorian Environment Minister Gavin Jennings offered rare support, saying the plan had the potential to "kick-start green investments for Victoria".

Business-as-usual cannot trump the laws of science on climate change

Media Release
Greens Media
Senator Christine Milne
Sunday 14 December 2008

The Australian Greens today warned the Rudd Government that its emissions trading scheme must be based on science or it will jeopardise the business-as-usual that it seeks to protect.

A target that aims at 550 ppm is a recipe for global catastrophe that will not only destroy the Great Barrier Reef and the Murray Darling, but also melt the glaciers that feed fresh water to 2 billion people in Asia, and trigger positive feed-back loops that may make life-destroying runaway heating unstoppable. 450 ppm still leaves a greater than 50% chance of exceeding 2C warming, beyond which point feed-back loops wait. Al Gore used the Poznan conference to call for a target of 350 ppm.

The Rudd Government's suspected most ambitious outlying aspiration of 25% emissions reductions by 2020 is the absolute minimum starting position, with 40% being a fair target to give the world a reasonable chance of preventing global catastrophe.

"Prime Minister Rudd must recognise that he cannot negotiate with the laws of physics and chemistry," Australian Greens Deputy Leader and Climate Change Spokesperson, Senator Christine Milne, said.

"The Prime Minister's spin that he is trying to strike a 'balance' between greens and business is scientifically ignorant nonsense.

"In any dispute between the laws of science and the desire to maintain business-as-usual, the laws of science will win every time. If we fail to do what the science demands, business-as-usual will no longer be an option for anyone.

"Facing up to climate change requires a full-scale war effort to transform our economy and society onto a sustainable footing. You do not 'balance' a war effort with business-as-usual.

"5-15% targets are very likely to see climate tipping points breached. We need cuts in the order of 40% to have a reasonable chance of avoiding catastrophe. The likelihood that the targets announced in tomorrow's white paper will fall significantly short of this will have with three major effects in the coming months.

"First there will be a drastic escalation in public anger as voters realise that the Rudd Government is not meeting its promise to tackle climate change. Second there will be significant diplomatic pressure brought to bear on Australia in the lead-up to Copenhagen - including the threat of trade sanctions. And third, in the face of the backlash, many companies will recognise that lax targets do not provide the investment certainty they were seeking.

"The only certainty provided by weak targets is that they will have to be increased very soon."

The Greens have also been effectively locked out of the 'lock-up' briefings being provided to NGOs and industry tomorrow morning before the White Paper's release. After repeatedly requesting a briefing, the Greens have finally been offered a lock-up from 11.30-12.30.

"It is quite clear that the Government is attempting to lock the Greens out of the debate, just as Australia locked the rest of the world out of engagement with its targets at the Poznan conference. This is foolish politics to complement foolish policy."

What do the Greens want from an emissions trading scheme?

To be environmentally effective

By far the most important criterion that we should use to judge the Government's proposed emissions trading scheme is environmental effectiveness. That is, do the scheme and its complementary measures reduce emissions to the extent that Australia is fairly contributing to the global challenge of constraining global warming to less than two degrees? To achieve this, Australia must reduce its emissions by 40% by 2020.

25%, which seems to have become a maximum possible figure rather than a minimum acceptable, is not only inconsistent with maintaining a safe climate, but it is also grossly unfair in that it implies that the developing world must commit to very drastic emission reductions while rich Australia does little. Rudd's proposal will kill any hope of global consensus.

To be equitable

Low income householders who face higher costs (especially energy) must be helped to reduce costs by reducing their carbon liability. The Green paper estimates that at $20/tonne ($40-$60 is needed) the "Scheme related increases in prices as a proportion of household expenditure on the CPI basket of goods and services are estimated to range from around 1.2 per cent for sole parent households to around 0.8 per cent for high income households." These may not seem like large amounts but many households are already over-extended. Householders must be assisted with energy efficiency upgrades.

To be economically efficient

This mainly relates to the questions of permit allocation (free versus auctioned), compensation to trade exposed industries and sectoral coverage. Economic efficiency is a third order issue because, if the scheme was poor on allocation and compensation, but still had a stringent emission cap, it could still be an environmentally effective scheme.

On allocation, regardless of whether permits are given away for free or auctioned, the expected energy price rises are the same. The reason the Greens and most economists prefer auctioning is that the government can put auction revenues to an economically productive use - such as compensating households, promoting energy efficiency, funding renewable energy R&D etc. By contrast, with free allocation polluters receive a lump-sum distribution of valuable assets. This represents a pure lump-sum wealth transfer from energy consumers to energy producers. There is no incentive attached to this transfer, and so it doesn't result in a change in marginal behaviour.

On compensation, the 'emission intensive trade exposed' industries are clearly deserving of some level of compensation where they are competing with foreign companies not burdened by carbon prices. The Greens believe that direct payments, funded from auction revenues, to the trade exposed industries may be appropriate if temporary and conditional upon the demonstration of efficiency gains. There is no rigorous argument for compensation of existing electricity generators.

On sectoral coverage, broad coverage increases the chance of finding cheap abatement. The Greens believe that transport should be included but that agriculture should be left out for now because of the high cost of monitoring and verification. Forestry should be excluded until full carbon accounting of all forestry emissions is in place. The development of full carbon accounting methodologies, including soil carbon, should be accelerated.

To ensure compliance

Environmental effectiveness requires that participants in an emission trading scheme actually comply. This would be in doubt if the scheme simply required a fine to be paid for non-compliance. There should be a "make-good" provision which would require participants to make good permit short-falls in later years.

Tim Hollo, Media Adviser Senator Christine Milne mobile 0437 587 562

Kevin 07 morphs into a classic version of Howard

The Age
Tim Colebatch
December 16, 2008

After all that, we are more or less back where we started. The Rudd model for tackling climate change now looks remarkably similar to the Howard model from 2007.

By the time the Coalition has forced further changes in the Senate -- as it will -- the scheme could end up almost identical to John Howard's.

Perhaps it was inevitable that the clean, hard lines of the Garnaut model would turn into a smudgy political compromise. Perhaps it was inevitable that Labor, like the Liberals, would try to shield from change everything emissions trading is meant to change.

The Rudd model aims to shield any industries or blocs of voters that would feel the pointy end of change. It aims to make emissions trading (ET to its friends) acceptable to business, and to the Liberals, who will have to vote it through the Senate. (Wouldn't it make sense to invite the Liberals to join in designing the scheme, so it had bipartisan support and investors would know it would last? Yes, but we don't do things that way.)

All Rudd's shields have blunted the point of ET: to drive change. The way we live and do business is heating up the planet. We have to change it. ET aims to create a way to do so at least cost, and prod us to shift to low-emission ways to live and do business.

But change means some things must pass. Modelling for the white paper found that ET could close one, two, even three of the Latrobe Valley power stations, because they produce megatonnes of carbon dioxide. That's how the scheme works: it makes us scrap old polluting technology for new, cleaner tech, such as the gas and wind power stations now being built. That's how we reduce emissions, but it ain't painless.

The trouble is that Kevin Rudd wants ET to be painless, so the scheme will give the generators almost $4 billion of free permits over the first five years -- with no quid pro quo.

The Rudd model gives away so much to interest groups that it plans to spend the entire revenue from ET simply to compensate everyone affected. Only a tiny fraction of that would drive changes in behaviour.

Polluting firms, electricity generators, households, motorists and small business: everyone is looked after. Many will be deliberately overcompensated. Treasury predicts that ET will raise prices by 1 per cent. But the Rudd model uses the revenue to pay for a permanent 2.5 per cent rise in pensions, family benefits and all other welfare benefits.

Aluminium smelters whose electricity bills will rise with ET will be given that money back, in spades, receiving permits for one tonne of free emissions for every 0.7 tonnes included in their electricity bill. Come to Australia, polluters' paradise!

Coal-fired power stations will be given $700 million a year to compensate them for the loss of asset value. But if their asset valuations assumed that tackling climate change would not diminish the plants' value, they were unrealistic. That is not taxpayers' fault.

Ross Garnaut envisaged a rigorous emissions trading scheme with few exemptions, and raising $4 billion a year to speed research, development and commercialisation of clean technology. The Rudd model spends everything on compensation, and has nothing left over to help solve the problem.

There is nothing left to promote change, such as the Greens' plan to retrofit the homes of low-income earners with energy-saving equipment. There is nothing to help developing countries such as Tuvalu and the Maldives adapt to the rising oceans.

The targets -- 5 per cent below 2000 levels without a global agreement, 15 per cent below with one -- are defensible in per capita terms, but will not persuade the world that Australia is taking climate change seriously. And the world may be right about that.

Angry Greens accuse PM of going easy on polluters

The Age
Tom Arup, Canberra
December 16, 2008

Green groups have attacked details of the Government's emissions trading scheme, criticising the proposed 5 to 15 per cent reduction targets and increased exemptions for trade-exposed heavy polluters.

Greenpeace, the World Wildlife Fund, the Wilderness Society and the Climate Institute were joined by the Greens and other environmentalists in calling for more ambitious 2020 targets of 25 to 45 per cent reductions.

Don Henry, chief executive of the Australian Conservation Foundation, said it had been a "very disappointing day" and that a 5 to 15 per cent target would not give business any certainty.

"The Australian people will look at the science and ask that these targets be revisited, and I'm sure the levels will be revisited if not next month, then next year or soon in the future," Mr Henry said.

"Business won't get any certainty out of this as the targets will have to be changed based on the science and because of a coming global agreement."

Prime Minister Kevin Rudd faced the anger of the Green movement when three protesters rushed the stage at the National Press Club as he was outlining the targets.

The protesters, believed to be from the Newcastle-based Rising Tide Australia, were removed from the room but were not arrested.

The Greens yesterday joined the chorus of criticism, with Greens senator Christine Milne accusing Mr Rudd of going easy on big polluters to the detriment of the Australian environment.

The Greens are organising protests in Canberra and Melbourne today.

Business groups gave a muted response, with some critical that the scheme was being implemented during a financial crisis and others quietly supportive of pro-business concessions.

The Business Council of Australia took credit for much of the scheme's approach to trade-exposed heavy emitters.

"Our initial review indicates that the Federal Government has taken into consideration many of our concerns (and) balanced them against competing demands," a spokesman said.

The most vocal business critic of the scheme, Minerals Council of Australia chief executive Mitchell Hooke, said the council was "profoundly disappointed" and the scheme would mean impossible costs during the financial crisis.

In his Press Club address, Mr Rudd pitched the Government's emissions trading scheme as straddling the political divide, and said he understood it would face criticism from both right and left of politics.

Liberal leader Malcolm Turnbull said the "devil will be in the detail" and the Coalition would conduct its own review. Opposition emissions trading spokesman Andrew Robb said even a 5 per cent reduction by 2020 would be "a big ask" for business.

Family First senator Steve Fielding, whose vote may be crucial to the legislation passing Parliament, is understood to be happy with the 5 per cent reduction target although he called for a Senate committee hearing into the legislation before he would back it.

Business wins out in moderate plan

The Age
Michelle Grattan
December 16, 2008

Kevin Rudd's emissions trading blueprint is laden with caution rather than vaulting ambition, as the Government tries to navigate through a dreadful economic outlook and a hostile Senate.

As Rudd predicted, all sides are unhappy. Environmentalists are furious, accusing the Government of selling out. Business, with dollars at risk, regards even a modest scheme with suspicion.

But it is business rather than the climate lobby that has done well between the July green paper and this white one.

There are more permits to be given out than initially proposed, under more favourable conditions, and additional industries including natural gas (which was a squeaky wheel) have been included.

Those changes, combined with the modest 5-15 per cent by 2020 target range, have made the scheme as unthreatening as possible.

While this may seem wimpish, it is sensible; the important thing is to get the structure in place for what is a massive reform, however gentle the start. Also, it would be irresponsible to be too gung-ho when the economy could be facing recession -- just as not going ahead would be a failure of responsibility.

The big disappointment for the climate lobby is that Rudd hasn't adopted the ambitious target of a 25 per cent reduction. This target is under the counter rather than on the table.

In the extremely unlikely event of a comprehensive international agreement next year, the Government would sign up to implementing 25 per cent -- after 2020.

Rudd points out 25 per cent would mean the Government's long-term target of a 60 per cent reduction by 2050 would have to be toughened -- and he says he wouldn't alter that without seeking a fresh electoral mandate.

The Senate -- where the numbers have to be mustered if the ETS is to become reality -- will be a battle for the Government. But the credibility of the Opposition and the Greens will also be on the line.

The Coalition is buying time, by commissioning a private economic analysis. It will continue to argue about timing. But if it ultimately refuses to pass a plan that could hardly be more moderate, the claim of Malcolm Turnbull, a former environment minister, that he's serious about climate change will be under question.

And for all their outrage, how will the Greens look if they refuse to support a plan that represents significant progress because it doesn't go far enough? Are they really going to say they would prefer no scheme to an imperfect one?

This plan mightn't match some of Rudd's past high falutin' rhetoric or make Australia an international climate change leader. But it is a big step: let's hope it is implemented.

Real leaders would set real targets

The Age
Robyn Eckersley
December 16, 2008

Climate change was one of a handful of policies on which the Labor Party distinguished itself from the Coalition during the 2007 election campaign. Following Kevin Rudd's ratification of the Kyoto Protocol immediately after his election, the international community hoped that Australia would shift from a climate laggard to a climate leader.

Twelve months later, the long-awaited white paper on a carbon pollution reduction scheme, the centrepiece of the Rudd Government's response to climate change, suggests this hope has been misplaced.

The success of any national carbon trading scheme depends on the comprehensiveness of its coverage of greenhouse gas emissions, the fairness of its distribution of the burden of mitigation, the effectiveness of assistance and other compensatory mechanisms provided to disadvantaged members of the community and, above all, the robustness of the emissions reduction trajectory or targets.

An Australian cap-and-trade scheme that is impeccably fair from the perspective of domestic stakeholders may be still considered a travesty by the international community, particularly the most vulnerable nations, if its emissions reduction targets are weak.

It is the medium-term 2020 target that really matters most. This is not simply because today's cabinet will no longer have to take responsibility for meeting this target from their retirement homes or graves in 2050. It is because the best available climate science tells us that deep and early cuts in emissions in the next decade will be most effective in reducing the risk of dangerous climate change.

Last year, the Intergovernmental Panel on Climate Change recommended -- and Australia supported -- emissions cuts of 25 to 40 per cent by 2020 for developed countries to reduce the risk of warming beyond 2 degrees, which still carries significant risks of coral bleaching, species extinction, water scarcity, extreme weather, coastal damage, mass migration and increased incidence of tropical diseases.

Instead, the Rudd Government has committed to a minimum, unconditional cut of 5 per cent below 2000 levels by 2020, rising to 15 per cent if "all major economies commit to substantially restrain emissions and all developed countries take on comparable reductions to that of Australia". "All major economies" includes developing countries such as China and India.

The white paper's version of "comparable reductions" is interpreted in a self-serving way to adjust for Australia's fossil-fuel dependence and rising population. So, for example, Australia's target is considered "comparable" to the European Union's 20 per cent cut, rising to 30 per cent if other developed countries accept strong commitments.

Against this background, the Rudd Government's preferred target of a 5 per cent reduction falls desperately short of what is required of an affluent nation such as Australia, which is among the world's top per capita carbon emitters and in the top 20 per cent of aggregate emitters.

The targets are weak not only in terms of well-understood scientific requirements but also the moral and legal requirements of leadership under the climate regime. The Government accepts the pessimism of the Garnaut Climate Change Review Final Report that an international agreement to stabilise atmospheric concentrations of greenhouse gases at about 450 parts per million of carbon dioxide equivalent, while desirable, is unlikely, and that Australia must adjust its own emissions reduction trajectory accordingly so as not to penalise domestic industry.

The white paper acknowledges that "leadership from the developed world encourages other countries to join the global fight".

Leadership surely means showing the way by going first, inspiring others and, as an affluent country, observing the burden-sharing principles of the climate change regime by performing relatively more of the heavy lifting. It does not mean waiting to see what others will do before taking concerted action. Nor does it mean postponing concerted action until substantial commitments are made from countries in which millions of people live below the poverty line.

An unconditional minimum commitment to a 5 per cent reduction by 2020 is unlikely to unleash the depth of technological innovation and collective commitment that is necessary to shift towards a low carbon economy and inspire countries such as China and India to leap-frog over the fossil-fuel development path.

The core burden-sharing principle of the United Nations Framework Convention on Climate Change requires developed countries to take the lead in combating climate change on the basis of their greater historical responsibility for emissions and their greater technological and financial capacity to pursue mitigation.

This is summarised as "equity and common but differentiated responsibility". The preamble to the convention also explicitly declares "that the largest share of historical and current global emissions of greenhouse gases has originated in developed countries, that per capita emissions in developing countries are still relatively low and that the share of global emissions originating in developing countries will grow to meet their social and development needs".

While it is widely recognised that most of the future growth in emissions will come from rapidly developing countries, the best way of addressing this problem is through exemplary leadership, the demonstration effect and massive technological and financial assistance, rather than through the subversion of the burden-sharing principles of the climate regime.

Regrettably, most of the debate in Australia over the Garnaut Review, and the Carbon Pollution Reduction Scheme green and white papers, has focused on who should bear the burden of adjustment within Australia. From the standpoint of protecting the planet, these questions are secondary to the relative burden Australia should accept as a developed nation.

Robyn Eckersley is a professor in the School of Social and Political Sciences at the University of Melbourne.

Low target hurts Aust's credibility, green groups say

By Political correspondent Louise Yaxley and staff
Posted Mon Dec 15, 2008 9:00pm AEDT

More than sixty green groups have combined to condemn the Government for deciding to cut greenhouse gases by 5 per cent by 2020.

The 60 groups say the 5 per cent target is weak, but industry groups including the food and grocery council and the minerals council say it goes too far.

Don Henry from the Australian Conservation Foundation says if every nation took Australia's approach, there would be no hope for effective change.

"Australia's not going to be viewed as credible. On one hand, we're saying, 'Yep, we need an ambitious, international agreement, we need an international agreement that will avoid dangerous climate change'," he said.

"But on the other hand we're fudging the figures and we're putting a low figure on the table that doesn't add up, that will encourage every other country to do the same.

"The Prime Minister has said, 'We've got to bat to try to avoid dangerous climate change.

"But he's walking out into the middle of a cricket pitch without his bat. We're going to be clean bowled as a nation because our targets are too weak."

The Northern Territory Environment Centre says the 5 per cent carbon reduction target is too weak and could have a devastating impact on the Territory.

Acting co-ordinator Emma King says if a 5 per cent target was adopted worldwide, attractions such as Kakadu National Park would be destroyed.

She says globally a target of 25 per cent is the minimum to avoid the more serious consequences of climate change.

"It's the sort of target that will mean the loss of the Kakadu wetlands and other coastal areas which are very important culturally," she said.

"And for food supply for Indigenous people it'll probably mean the increase in severe weather events. That's one of the predictions that's being made."

The Opposition has not decided yet if it will back the scheme but Coalition's spokesman Andrew Robb has told Sky News they have ordered their own study.

"We must look at this in a very considered and objective fashion and not rush into it," he said.

Mr Rudd says he is suspicious.

"Malcolm Turnbull and the Liberals are now looking for excuses not to act again," he said.

Mr Rudd has announced that coal-fired power stations will get $4 billion in compensation but the Australian Coal Association's Ralph Hillman says there is not enough assistance for trade-reliant industries.

He says black coal exporters will lose business to nations that do not have the burden of carbon pricing.

"Competitor mines in countries such as Columbia, South Africa, Mongolia, Indonesia - what's going to happen is they're going to take our market share as our costs rise under the CPRS with no benefit to global environment because of carbon leakage," he said.

"Investment will simply go to those countries and slow down Australian coal mining."


The Prime Minister has announced the Government will spend $6 billion to compensate low income earners and pensioners for the costs imposed by a carbon reduction scheme.

Mr Rudd says the pension will rise by 2.5 per cent.

"Around 90 per cent of low income households or 2.9 million households overall will receive assistance equal to 120 per cent or more of their cost of living increase," he said.

Lynne Hatfield-Dodds form the Council of Social Service says she is pleased the Government will fully compensate low-income earners for increased costs.

"On first reading of the household assistance package, it appears that the Government has in fact met that commitment, so we're really pleased to see that.

"We were disappointed, however, to see no retro-fitting measures to assist low-income households move to an energy efficiency state."

Renewable energy boom set to go up in smoke

Sydney Morning Herald
Ben Cubby, Environment Reporter
December 16, 2008

Until yesterday the so-called "green revolution" was ready to roll, but the renewable energy industry doubts the Government's white paper will allow it to get out of first gear.

The fear is that since carbon permits are limited to $25 a tonne, and many are being given away, the emissions trading scheme will simply add a little lead to the saddlebags of heavy polluters without giving enough incentive for investors to switch to emissions-free technology.

"There's no doubt the white paper is actually undermining the potential for green-collar jobs in Australia," Mark Diesendorf, the deputy director of the Institute of Environmental Studies at the University of NSW, said.

"We've put up a message that says to investors 'stay away'.

"We have a huge raft of proposals for large wind farms, for baseload solar plants, we have huge potential for jobs in the energy efficiency sector, but that potential needs the right policy settings from government so businesses can start to make investments."

Among many reports produced in recent months, a study by the ACTU and the Australian Conservation Foundation found that 500,000 jobs could be created in renewable sectors of the economy by 2030.

But the soft start to emissions trading, together with the modest ambitions for carbon cuts, is unlikely to create a jobs boom.

"A soft start only works if it is backed with aggressive investment signals in energy efficiency and clean technology," said Matthew Warren, the chief executive of the Clean Energy Council. The council is a peak body which aims to represent the interests of renewable energy as well as those of some polluting industries.

"These [signals would] deliver the biggest emissions cuts in the first years and prepare the Australian economy for the changes to follow.

"The white paper suggests the Government understands this relationship, but it hasn't yet delivered on it."

The white paper would be more likely to maintain the status quo than wean Australia off coal-fired power, said Iain MacGill, the director of the Centre for Energy and Environmental Markets at the University of NSW.

"The real winners today are clearly large emitters who appear to have successfully persuaded the Government to propose weak 2020 targets and provide them with billions of dollars of subsidies beyond even those proposed in the green paper," Dr MacGill said.

The burning concerns about Captain Reasonable

Sydney Morning Herald
Peter Hartcher
December 16, 2008

Behind closed doors Kevin Rudd has sometimes described his political persona as "Captain Reasonable".

And it was the captain who took the podium at the National Press Club yesterday, calm, controlled, and, most of all, moderate.

He described climate change as an elephant of an issue, but then proposed not doing anything especially big about it.

He called it "a threat to our people, our nation and our planet", but then announced only the gentlest of responses.

He said the country stood at "the crossroads of history", but then suggested that we choose the course of least resistance.

For heaven's sake, he seemed to be saying, can't we all just be reasonable.

Rudd's carbon emissions plan is crafted as a piece of political positioning, and he said as much himself:

"We will be attacked from the far right for taking any action at all," he said early in his speech.

"We will be attacked from parts of the far left for not going far enough. The Government believes we have got the balance right."

So the environmentalist who tried to shout him down as a sell-out instantly confirmed part of his proposition, and the Minerals Council, calling the plan "the most aggressive in the world" vindicated the rest.

This is Rudd's political GPS, the sort of logic that guides him to the position he craves, the place he has frequently described as "the reforming centre".

This is the thinking that led him to decide that the only unconditional cut to emissions is to be 5 per cent by 2020.

It's the centre because it's midway between the pressure groups. It's reforming because it can be presented as some sort of progress towards good policy.

Yet it's such a retreat from Rudd's campaign rhetoric on climate change as the "great moral challenge of our generation" that the Liberal Party's pollster, Mark Textor, quipped yesterday "it's like Sydney house prices - coming down every day."

As battle cries go, it's hardly "death or glory". Try it: "Follow Captain Reasonable to the reforming centre." Rudd's plan also rings an alarm about his attitude to the public purse. The Government will over-compensate 2.9 million low-income earners and pay them the equivalent of 120 per cent of the cost of the scheme. Is this really about equity, or is this just an excuse to hand voters money in pursuit of political popularity?

If the Government is really concerned about equity, why won't single people receive compensation? Rudd wants to be liked by key demographics. And he wants to buy their affection. If this feature emerges as a continuing part of his political persona, it could be a big worry about Captain Reasonable.

The carbon plan is cautious and calculated. Rudd has set the target so low it's a small target for Malcolm Turnbull to attack.

If the Opposition opposes a cut of 5 per cent as too drastic, can Turnbull seriously retain any pretence to be environmentally concerned? But if the Opposition supports the plan, it will be sidelining itself on one of the biggest political issues. Either way, Rudd is left occupying the reforming centre.

Rudd has set a dilemma for Turnbull, and the Opposition knows it. That's why it fell uncharacteristically silent yesterday, commissioning economic research to give it a couple of months to respond.

Rudd's penultimate sentence described his plan as "reasonable and responsible". By following the course of least resistance in crafting the carbon target, and with the selective generosity of the compensation payments, we must wonder whether Captain Reasonable is merely the alter ego of general popularity.

Rudd digs deep for coal sector

Sydney Morning Herald
Phillip Coorey, Chief Political Correspondent
December 16, 2008

Businesses, community organisations and coalmining communities not eligible for direct compensation under the emissions trading scheme have not been forgotten, with a $2.5 billion special fund set aside to help them adapt.

The Climate Change Action Fund will be available to pay for energy-saving measures that would reduce operating costs.

As well, there will be help for the coal sector that could otherwise be at risk as a consequence of the scheme, threatening jobs and communities in predominantly Labor seats.

The biggest component of the fund, $1.4 billion, will be available to low-polluting small and medium-sized businesses, as well as community organisations, none of which are participants in the emissions trading scheme but which will be affected by the higher costs it produces.

They can apply for grants to install more energy-efficient lighting, air-conditioners and any other appliances. Money will also be available to help implement more efficient production methods.

The second-biggest component of the fund will be the $750 million to help coalmining regions. Particularly "gassy" mines - those which emit greenhouse gases as a consequence of mining - will have to buy permits but will not be eligible for the standard industry compensation.

Dirty, existing coalmines will be eligible for $500 million in assistance to keep them viable while they explore ways to cut pollution. Another $250 million will be used to help find solutions.

The third element will be $200 million in structural adjustment for workers in other sectors who may find their jobs at risk.

"The Government stands ready to provide assistance where a clear, identifiable and significant impact arises, or is highly likely to arise, as a direct result of the scheme," the white paper says.

The Prime Minister, Kevin Rudd, said the provision was necessary to deal with any "unanticipated challenges".

The final component of the Climate Change Action Fund will be $130 million for an "information" program to alert small business and community organisations to the existence of the fund and how to manage under the emissions scheme.

Polluter assistance and 5% target: Rudd's CO2 fail

Monday, 15 December 2008

Canberra correspondent Bernard Keane writes:

The Government has restructured its emissions trading scheme to deliver even greater assistance to Australia's biggest polluters and to scale back its commitment to participate in any international agreement, well below that advocated in the Garnaut Review.

The emissions trading scheme White Paper released this morning proposes that Australia commit to a unilateral 5% reduction in carbon emissions on 2000 levels by 2020, equivalent to a 27% per capita reduction given Australia's population growth.

In the event of an international agreement, the Government has proposed committing to up to a 15% reduction by 2020, equivalent to a 34% per capita reduction.

The unilateral target of 5% is in line with that recommended by Garnaut, and the 15% target would reflect an international agreement somewhere between the 550ppm realistic goal discussed by Garnaut -- which would require a 10% cut -- and the 450ppm ambition that would require a 25% cut by 2020.

However, the Government has rejected Garnaut's recommendation that it commit to a 25% cut if an international agreement around 450ppm is reached (equivalent to a 40% per capita reduction). Australia will go no lower than a 15% cut, even though the White Paper specifically states that "the Government believes that it is in Australia's national interest to achieve a comprehensive global agreement to stabilise atmospheric concentrations of greenhouse gases at around 450ppm".

In the event such an agreement is reached, the Government has only committed to reconsider its post 2020 targets.

The Government strongly argues that its 5-15% effort is comparable to that adopted by Europe on a per capita basis -- Europe's current goal of 20-30% below 1990 levels equates on a per capita basis to 24-34% below 1990 levels; Australia's 5-15% goal would be 34-41% below 1990 levels.

The Government has also made significant concessions to Australia's biggest polluters in the design of the scheme. Under the White Paper scheme, the carbon price will be reduced by permitting unlimited importation of accepted international permits, and there will be a $40 price cap for the first five years of the scheme. The Government expects the initial permit price to be around $23 a tonne, and some borrowing of the following year's permits will be permitted in addition to unlimited banking.

The compensation arrangements have been significantly broadened to include industries that previously missed out on compensation and to provide greater flexibility for companies in determining their eligibility for compensation, through providing a value-added option in addition to the tonnes per million dollars revenue, and extending the period on which the calculation is based.

The threshold of 2000t per million dollars revenue/value added has been retained from the Green Paper, above which trade-exposed firms will be eligible for 90% free permits. But in a big victory for the LNG industry and other previously borderline industries, the lower threshold at which 60% of permits are provided free has been dropped to 1000t per million dollars revenue/value added.

As a consequence the proportion of free permits under the scheme has increased from 20% to 25% -- with another 10% for agriculture, which will remain excluded until at least 2015.

The Government has also clarified that such firms will receive increasing numbers of free permits if they increase production, meaning there will be no cap on emissions from our worst polluting sectors. There will be a 1.3% "dividend" deducted from caps each year but under normal economic growth conditions, it means that by 2020 45% of permits will be handed out free to polluters.

The Government will also provided $3.9b over five years in handouts to the coal-fired power industry, as well as a $2.15b "climate change action fund" for handouts to businesses, community groups and the coal mining industry. The petrol excise offset from the Green Paper has been retained, and the Government has strengthened its household assistance measures, promising to overcompensate nearly all low-income households with 120% of their additional costs, and committing that most middle-income households will not be out of pocket.

The Government expected to generate $11.5b in permit revenue in 2010-11, with all permit revenue recycled back into assistance, and a substantial risk that if big polluters grow faster than the rest of the economy, the Government will be forced to fund some assistance measures from the Budget.

Now the Government's selling task begins, commencing with Kevin Rudd - having bumped Penny Wong -- at the Press Club today. Next stop, the Senate.

Our biggest polluters have won

Monday, 15 December 2008

Canberra correspondent Bernard Keane writes:

The surrender is virtually complete. Our biggest polluters have won, and the rest of us will be paying for it under a joke of an emissions trading scheme that encompasses a significant transfer of wealth to our largest polluters.

The Government has rejected the two fundamental truths at the heart of the Garnaut Report -- that it costs less to act now rather than delay, and that acting within an international agreement significantly reduces the costs of curbing carbon emissions.

By taking a 450ppm option off the table until after 2020, the Government is in effect saying that such an agreement in Copenhagen isn't merely improbable, but that we wouldn't cooperate with it for a decade even if it eventuated, despite modelling consistently showing that the costs of pursuing even ambitious emissions reductions targets are much lower when there's an international framework. The signal to the rest of the world is clear: Australia is still a climate change recalcitrant.

Remember we're not talking here about unilateral action. The Government has said it will not take action until after 2020 to comply with a 450ppm target even in the event the rest of the world manages to agree to such a target next year.

And on compensation, too, our biggest polluters have won a major victory. In addition to increasing the flexibility with which eligibility for compensation will be calculated, the Government has lowered the arbitrary threshold at which 60% of free permits are allocated, dropped from 1500t per million dollars revenue to 1000t per million dollars revenue or value added. That will bring in the LNG sector -- although presumably won't shut up Don Voelte, corporate Australia's biggest whinger. Doubtless there are firms around the 900t per million dollars mark who are already preparing to lobby for further relaxation.

In the absence of an international emissions trading agreement, if eligible industries grow at about the same rate as the rest of the economy between now and 2020, at that point 45% of all permits will be handed out for free to polluters, even with a sort of carbon efficiency dividend each year.

And each time more permits are handed out to polluters, the burden on the rest of the economy increases. Low and medium-emission firms ought to start lobbying now for the retention of the price cap through to 2020, otherwise it's going to be very expensive bidding for the remainder of the permits left over after they've been gifted to polluters.

And if heavily-polluting industries grow any faster than the rest of the economy, the impact on scheme revenue will mean taxpayers will have to start funding some of the assistance measures, which are meant to be revenue-neutral.

The coal-fired power industry will also do very well. Despite taking investment decisions for a decade or more knowing that action needed to be taken on climate change, they will still receive nearly $4b in assistance, described as "once and for all" in nature. Believe that when you see it.

With such massive handouts and generous compensation arrangements, the ETS will be a half-baked, ineffective joke amounting to little more than a paper-shuffling exercise for our most polluting industries. The latter have worked hard and successfully to convince the Government to further weaken what was already an inefficient and anaemic scheme in its Green Paper form.

The political consequence of that, however, is that the Coalition will be struggling to find grounds on which to block the ETS when it comes before the Senate next winter, and might lack an industry support base for its efforts, even in Western Australia. Today the Coalition was still saying a 2010 start date was too soon. That plays into the Government's hands perfectly, reinforcing Kevin Rudd's message that he occupies the moderate middle ground on climate change.

It's politically astute, but a craven surrender to polluters and rentseekers. In the middle of the year, Kevin Rudd was talking up his capacity to take tough decisions. On climate change, we've yet to see any evidence of it. Worse, we've announced to the world that we're not prepared to play our part in reducing our emissions.

Hamilton: White paper runs up white flag

Monday, 15 December 2008

Clive Hamilton writes:

In normal circumstances the Government's announcement to cut Australia's greenhouse gas emissions by 5-15 per cent over a decade would be a significant policy move. But circumstances are not normal.

The climate emergency demands a political response that transcends the usual approach of balancing competing interests to minimise political pain. Yet the White Paper reflects the Prime Minister's repeated claim that his task is to weigh the demands of industry against those of environmentalists.

When Kevin Rudd told Kerry O'Brien last week that he would not be caving in the "extreme environmentalists", he was not just defining a "moderate" space to occupy, but casting doubt on the climate science. He was saying that we should take the conclusions of the scientists -- that the industrialised world must cut its emissions by 25-40 per cent by 2020, with the developing world following soon after -- with a grain of salt.

The scientists are not extremists and nor are the environmentalists. In fact, they are both restrained. Publicly, the scientists display the usual professional caution, although privately they are panicking. The mainstream environmental organizations, concerned to protect their access and maintain "relevance", are pushing a "moderate" position. A policy that reflected the science would be one that swept aside the pleading and bullying of the fossil-based industries and pursued nationally the emission cuts that will best advance the global response that is needed to protect us all from climate catastrophe.

Yet it is precisely the pragmatism of political trade-offs that the White Paper pursues. It mirrors the fundamentally conservative "realism" of Ross Garnaut that plays into the hands of industry obstructionists.

Rather than moulding the science to conform to the politics, the politics must conform to the science. And the science calls for emergency measures. The IPCC Fourth Assessment Report, released in early 2007, is now widely recognised as being worryingly out of date. The scientific work on which it is based is now five years old and in that time there has been a rush of studies indicating that the situation is much more dire than the IPCC concluded.

It is now expected that Arctic sea-ice in the summer will disappear entirely before 2015. The weakening of the albedo effect and warming of the Arctic Ocean will have a heating effect up to 1500 kilometres away thereby increasing the rate of melting of the permafrost with its vast stores of frozen carbon. That's a tipping point we really don't want to get to.

The only bright spot in the politics is the continued commitment by the Government to begin the emissions trading system in 2010. Delay makes no sense for anyone. The economy will be coming out of recession at the beginning of 2010 and business will be looking for good investment opportunities, so why not direct it into clean energy?

The certainty provided by the ETS will stimulate investment and economic growth. The Opposition's proposal to delay the scheme's start-up to 2012 makes no sense economically or environmentally. It would only create uncertainty, undermine confidence and delay the recovery.

ETS target whittled away by interest groups

Monday, 8 December 2008

Canberra correspondent Bernard Keane writes:

With a week to go before the release of the detail of the Government's Emissions Trading Scheme and its associated target, the debate on an appropriate target for Australia is ramping up.

Thirteen Australian companies today joined dozens of international companies urging developed nations to adopt "immediate and deep economy-wide emission reduction commitments which are much higher than the global average reduction target." The newly-formed Global Climate Network has launched a report showing that the time for action to prevent highly-damaging levels of climate change is rapidly coming to an end. And Ross Garnaut is urging the importance of an international agreement in which developing countries play their part, but on the basis of a (very) long-term convergence of per-capita emissions targets. The Australian has helpfully spun that into an argument for doing nothing without India and China.

Garnaut also observes that getting an international agreement on emissions targets will be harder than securing trade or arms controls agreements. Which probably means that our grandchildren -- the ones that are left -- will be finalising a deal for mutually-verifiable reductions of 5% in non-farm sectors in 2050.

I noted when the Government's Green Paper emerged that it proposed a scheme that was only two-thirds effective anyway, and would be watered down further under pressure from rentseekers and corporate sooks and whingers. Sadly, that appears to be exactly what has happened. In particular, the establishment of an arbitrary threshold -- 1500t of CO2-equivalent per million dollars revenue -- as the basis for free permits has predictably led to pressure on the Government to lower the threshold or otherwise extend the compensation arrangements.

This is what is known as being hoist on your own petard. The Government would have been better off taking a harder line on compensation and caving in to only the heaviest polluters. The contrast with the Howard Government's mostly-successful resolution to hold the line on the GST is instructive. Ultimately no amount of compensation short of 100% will stop the lurid predictions of carbon leakage, even when the impact of the ETS would be well below that of the impact of the sort of fluctuations in the value of the Australian dollar seen in the last six months.

Still, politicians are not rational creatures, and telling them something will cost jobs when the great question of the moment is whether we will join the world in recession is the best way to guarantee you'll get what you want. Stand by not merely for increased ETS compensation but a low -- almost notional -- initial carbon price.

A failure to adopt a fully-effective ETS means we have to fall back on other measures to reduce emissions - other, less effective and efficient measures, revolving around encouraging investment in renewables and carbon capture.

Many environmental stakeholders want both a tough ETS and a host of complementary measures to drive renewable energy investment. Last week, the ACF, the ACTU, ACOSS, the Climate Institute, and the Australian Institute of Superannuation Trustees and the Property Council of Australia all joined forces to call for a "Green New Deal" involving the investment of billions in renewable energy and energy efficiency -- in addition to a stringent ETS target.

Garnaut's argument was that a functioning ETS didn't require complementary measures. He was correct, but the point will be moot. The debate needs to switch focus to how we encourage investment in energy efficiency and renewables.

One suspects this is where politicians -- of all persuasions -- would prefer the debate to be. An ETS is the most hands-off of mechanisms. It's set-and-forget, with minimal opportunities for political interference once it is up and running. But investment program and tax incentives hand politicians the power to make decisions, cut ribbons and help preferred constituencies. The Rudd Government's enthusiasm for the decidedly-undeveloped technology of carbon capture is hard to explain without understanding the political influence of both the coal mining industry and its unions.

The Government is still committed to a renewable energy target, although its implementation is in the somewhat uncertain hands of COAG. A fortnight ago, COAG produced some decidedly wishy-washy national guidelines on feed-in tariffs for renewable power generation.

The downside of investment programs and tax expenditures is their cost. To seriously drive efficiency and renewable investment, to make a significant dent in problems like first-mover disadvantages, and to bridge the huge gap between research and commercialisation of new technologies, requires billions of dollars. A few months ago, we had those billions in the budget. Now they've vanished faster than a collapsing investment bank. Suddenly the choice of addressing climate change the efficient way, via an ETS, or the less efficient way, through government investment, is problematic for politicians either way.

There's one small glimmer of hope. If the Government can at least ensure that its carbon price, however low initially, will increase in real terms year-on-year, then eventually businesses and households will start to accept it and respond in the way they consume, produce and invest. The only problem is, all the evidence suggests we don't have a lot of time to let that happen.

Australia called to act on climate

The Age
Adam Morton and Brendan Nicholson
December 8, 2008

A SENIOR Chinese climate adviser has warned that Australia would derail global climate talks if its 2020 greenhouse target was less than a 25 per cent cut in emissions.

Dr Jiahua Pan, from the Chinese Experts Committee for Climate Change, said Australia would be acting as though it considered itself a poor nation if it set a maximum target of a 15 per cent cut at the end of UN climate talks in Poland.

His public call is a sign of disenchantment among developing nations, including China -- the world's biggest greenhouse emitter, that Australia, Japan and Canada have not joined Europe in promising deep cuts.

Yesterday, as Climate Change Minister Penny Wong prepared to fly to the Poznan conference, she declined to say what Australia's target would be. The Government plans to release that information on December 15 -- after the conference.

"We have to also remember what we need to strive for is an agreement that delivers substantial reductions in the carbon dioxide in the atmosphere by 2050," Senator Wong told the ABC's Insiders program.

Opposition climate change spokesman Greg Hunt said Senator Wong should take to Poland the global rainforest recovery plan drafted by the Coalition.

"The single biggest thing the world can do over the next five years is to curb global emissions resulting from the clearing of rainforests," Mr Hunt said, adding that the plan would save the equivalent of seven times Australia's annual emissions.

Dr Pan's concern came as newly formed Global Climate Network -- a collaboration between seven international research institutes -- prepares an analysis which found that even if all wealthy nations adopted the relatively ambitious greenhouse targets proposed by Europe and US President-elect Barack Obama, it would not be enough to avert the worst climate change predictions.

Dr Pan said the Rudd Government must follow the lead of the European Union, which has committed to a 20 per cent cut, increasing later to 30 per cent.

"If we did not have these targets, I think we would go away from Copenhagen (2009 conference) empty-handed," Dr Pan told The Age.

"Outsiders would say: it (Australia) is acting like a developing country -- it is very strange ... If you cannot do it, how can you ask us to do it?"

Federal cabinet is weighing up its 2020 reduction target amid expectations it will not fall within the 25 to 40 per cent range advised by climate scientists and backed by most rich nations in Bali a year ago.

The climate change ambassador for Brazil said his country was also worried about the lack of commitments from industrialised nations. "Basically the EU is the only one that is acting," Sergio Serra said.

The Global Climate Network, which includes Australia's Climate Institute, found that even a 30 per cent cut in emissions by wealthy countries would not be enough unless poor nations limited their emissions growth.

A 30 per cent cut is the maximum target promised by the EU. The analysis found the developing world would have to curb emissions growth by at least 15 per cent to put the world within the lower end of the 25 to 40 per cent reduction range.

Climate Institute policy director Erwin Jackson said the shortfall must be addressed.

"Australia can't help close the emissions gap if our target is just a 15 per cent reduction by 2020," Mr Jackson said.

This is our critical moment. We mustn't hesitate

The Age
Don Henry
December 9, 2008

Australia's future depends on climate change negotiations.

IT'S cold and grey in Poznan and progress towards international action on climate change seems as slow as the Warta River flowing through the city. Climate Change Minister Penny Wong will arrive today and will be part of a working group negotiating the "shared vision" that underpins the negotiations. The Poznan meeting is the mid-point of the climate negotiations that will conclude in Copenhagen in December next year.

Copenhagen will be the best -- and possibly last -- chance the world will have to avoid dangerous climate change, as the UN's Intergovernmental Panel on Climate Change (IPCC) has reported to all governments that global greenhouse emissions need to peak and start coming down no later than 2015 to give the world a reasonable chance of avoiding the worst impacts of climate change.

The current negotiations are set to agree to a new climate treaty starting in 2012, so time is running out.

If we want to save the Great Barrier Reef, our water supplies, our beaches and billions of people around the world vulnerable to climate change, this is our moment in history.

Obviously no one country can do it alone. Australia's future depends on these negotiations delivering strong concerted action by all countries to get global emissions down. The IPCC has advised governments that global emissions will need to be cut by 50 to 85 per cent by 2050 if we are to avoid a 2 degree or greater rise in global temperatures.

It makes clear that to do our fair share, developed countries, as a group, will need to lead this effort and cut emissions by 25 to 40 per cent by 2020.

Developing countries have agreed they would take "measurable and verifiable" action to reduce their emissions.

At Poznan this week, Australia can ensure this science-based advice informs the negotiations.

We can make sure the talks move from generalities to specifics, with the IPCC targets used as the basis for negotiations.

We can encourage others with the detailed findings of Professor Ross Garnaut and Australian Treasury's studies that deep cuts in emissions are feasible and affordable in Australia and early global action is the most cost-effective way forward.

US President-elect Barack Obama said last month in a message to Poznan delegates that he would be watching these negotiations closely. And he foreshadowed a very different approach from the one we have seen from George Bush's negotiating team.

Mr Obama said: "Once I take office, you can be sure that the United States will once again engage vigorously in these negotiations and help lead the world toward a new era of global co-operation on climate change. Now is the time to confront this challenge once and for all. Delay is no longer an option. Denial is no longer an acceptable response. The stakes are too high, the consequences too serious."

While Obama is not yet in office, Kevin Rudd and Penny Wong are.

Aside from urging global action, there are two other things Australia can do to be influential and constructive in achieving a global outcome.

First, we need to do the right thing at home so others will listen. Garnaut recommended that "in preparation for Copenhagen, Australia should ... express its willingness to reduce emissions from 2000 levels by 25 per cent by 2020 and by 90 per cent by 2050 in the context of an international agreement".

Australia's commitment would give a real lift to the international negotiations. Just a couple of days ago South Africa resorted to publicly calling on Australia to come forward with credible and ambitious mid-term targets within the 25 to 40 per cent range for 2020.

And, as reported in yesterday's Age, a Chinese Government climate adviser said Australia could derail the global talks if its 2020 target for reducing carbon emissions came in at less than 25 per cent.

The Treasury modelling, released in October, poured cold water on claims by big polluters that a strong target would be bad for business. In fact, it showed the difference between strong and weak targets is negligible for the economy.

Treasury found a 25 per cent target would reduce average annual GNP growth by just one tenth of 1 per cent less than if the world did nothing to cut emissions. But many of Australia's special places -- priceless treasures such as the Great Barrier Reef, the Australian Alps and Kakadu -- face complete devastation from climate change unless Australia shows greater leadership and takes real steps to reduce our carbon pollution.

Second, based on solid action at home, Australia can reach out to China, the US, Indonesia, Japan and the European Union to build support for action.

We're not the biggest or most powerful country on earth but as a "middle power" our voice is respected and we need it to be heard in our region like never before. A cautious "business as usual" approach is not good enough in these negotiations.

We have no other option but to play to win. As Garnaut has reminded us: "The failure of our generation would lead to consequences that would haunt humanity till the end of time."

Don Henry is executive director of the Australian Conservation Foundation. He is in Poznan for the UN Climate Change Conference.

Rudd dobbed himself into dilemma

Sydney Morning Herald
Peter Hartcher
December 5, 2008

The Rudd Government is aiming to make one of its most difficult decisions in the next three days - setting the target for cutting Australia's carbon emissions over the next 12 years.

A cabinet sub-committee has been meeting every second day, searching for agreement on one of the signature issues of Rudd's first term.

The Government does not plan to announce its decision until it publishes its white paper on December 15. But the main elements of the new national carbon regime will be decided before the Climate Change Minister, Penny Wong, leaves for Poland for an international meeting on Monday.

The long-range target was the easy part - last year Rudd announced an intention to cut carbon output by 60 per cent by 2050, relative to the level of 2000.

The more distant the date, the bolder the Government. It's easy to be brave making a promise that can't be tested till decades after your government is an artefact and your only media appearance is in a dusty portrait.

The target for 2020, the so-called interim target, is the hard one. It's the one the country will have to commit to in the next two years, the one the Government will be held to account for. What should it be?

United Nations climate scientists urge that, to arrest global warming before it reaches a "tipping point" of irreversible damage, governments need to stabilise carbon in the atmosphere around the current level of 450 parts per million by mid-century. To achieve this, the interim target would need to be for a cut to Australia's carbon output of 25 per cent by 2020.

The damage to the economy? Simulations by the Commonwealth Treasury predict it would be modest. From 2010 to 2020 cumulative growth would be 2 percentage points lower than it would be without any cut to emissions.

The most dramatic effect, Treasury says, would be a 37 per cent increase in household electricity prices.

But compare this with recent changes in energy prices. The price of oil doubled in the year to July - a violent movement in the price of the world's central energy commodity.

Did Australia go into recession as a result? No. Did any country? No. The economic downturn began on Wall Street, not on the oil market. The world economy adjusted easily and smoothly to the recent oil price peak.

Sure, a 37 per cent increase in electricity prices would cause some consumer hardship. The Government could compensate low-income households with some of the proceeds of the emissions permits it will sell to industry.

So if that's what the climate science demands, and if the economy can cope, we must be heading for a 25 per cent cut in carbon output by 2020, yes?


The decision crystallising inside the Government is not being dictated by the UN climate science recommendation. The decisive forces are political - international and domestic.

The big elements in the international politics are uncertainty and a negotiating quandary known as the "prisoner's dilemma". What will an Obama administration decide to do about carbon emissions in the United States? Can it strike a deal to bring China into the effort? These countries are the two largest emitters, and these questions are the two greatest uncertainties. In the face of these unknowns, other countries are hesitant to commit to anything ambitious.

The prisoner's dilemma is an old quandary that arises when two suspects are arrested for a crime and interrogated separately. If one informs on the other, he will go free but his accomplice will go to jail. This is an incentive for each to betray the other.

If each yields to suspicion, both will be locked up. The best outcome for the prisoners is for neither to say a thing. In that case, both go free. So mutual loyalty and trust is rewarded.

This is exactly the situation with the global climate change negotiations. The only real hope of a global agreement is if all countries act nobly. Hard experience is that many countries will not. In the absence of real leadership and popular support, governments are tempted to act on their suspicions and mistrust of one other. Why should one country commit to the pain of curbing its carbon emissions if others don't? In this case, there will be no effective global agreement. Warming will continue unchecked.

This stand-off led the Government's climate change adviser, Professor Ross Garnaut, to say that "the numbers that add up to 450 ppm" - the level necessary to avoid a tipping point - "are not yet within the decision frames of the people who will need to commit to them".

Garnaut recommended that Australia first offer a low-pain cut to emissions of 10 per cent by 2020. This would be consistent with a riskier level of carbon in the atmosphere - 550 parts per million.

The cabinet subcommittee - comprising Rudd, Wong, Wayne Swan, the Environment Minister, Peter Garrett, the Industry Minister, Kim Carr, the Resources Minister, Martin Ferguson, the Families Minister, Jenny Macklin, the Agriculture Minister, Tony Burke, and, intermittently, the Deputy Prime Minister, Julia Gillard, and the Finance Minister, Lindsay Tanner - is settling on a target centred on a cut of 10 per cent.

But to retain flexibility for the coming negotiations it will be expressed as a range - a cut to emissions of 5 to 15 per cent. And, should Australia be accused of wimping it, ministers point out Garnaut's finding that a 10 per cent cut to national carbon emissions by 2020 is equivalent to a cut of 27 per cent per capita because of our expected population growth.

The ministers, with the prisoner's dilemma in mind, are keenly aware that if Australia sets a more ambitious target than other countries, some big investments would move to more permissive countries. There could be a big opportunity cost for Australia, they argue.

The ministers are also keenly mindful of domestic politics. Rudd was elected, in part, on a climate change platform. So he must act. But the Rudd Government knows the Opposition will seek to accuse it of sacrificing Australian jobs to a quixotic green dream.

The subcommittee considers a target cut of 10 per cent, or a range of 5 to 15 per cent, a judicious political compromise. To do less would be to disappoint the voters who trusted Rudd to act on climate change; to do more would expose it to Opposition charges of recklessness.

In other words, the judgment is that it's the credible minimum action that Australia can take, the course of least resistance. It is, after all, politics.

Peter Hartcher is the Herald's political editor.

The Maldives and Global Warming: Losing paradise

By Mohamed Nasheed
December 23, 2008
International Herald Tribune
MALÉ, Maldive Islands

Any sensible head of state will tell you that the priority of high office is the defense of the realm. When I was elected president of the Maldives last month, my advisers gave me similar counsel. Like any other nation state, at any point in history, the Maldives must protect itself from the menace of foreign invasion, terrorism and espionage. Still, to be honest, I really don't see any one wanting to invade or attack us.

For the first time in the country's history, however, the Maldives face a new threat. This new danger is of apocalyptic, existential proportions, and it looms silently, invisibly and menacingly over our azure horizon. I am talking about climate change and rising sea levels.

Looking out from my office window, it is difficult to believe that this view may someday disappear. And what a vista it is: Crusoe islands of swaying palms and snow-soft sand, encircled by turquoise lagoons and coral reefs teeming with all the exuberance of life. I can't help but be reminded of the words of the great Mughal Emperor Jahangir: "If there is a Paradise on earth; it is this, it is this, it is this."

I assume that it is a series of ecological accidents that creates such wondrous beauty. The nature of our ecosystem, however, makes us particularly vulnerable to climate change. The average height of our islands is just 1.5 meters above sea level. The Intergovernmental Panel on Climate Change warns that sea levels could rise over half a meter by the end of the 21st century, unless urgent steps are taken to halt greenhouse gas emissions. Less optimistic scientists, however, predict sea rises of nearly two meters. Low-lying island states such as the Maldives are living on borrowed time.

Some people shrug their shoulders at climate change. The cost of taking urgent action, they say, is too great. If the world has to lose the odd low-lying island state for the sake of unrestrained economic growth, so be it.

Such an attitude is as delusional as it is disingenuous. Scientists at the recent UN Climate Change Conference in Poznan suggested likely global temperatures rises of two-to-three degrees, unless the world makes rapid and deep cuts in CO˛ emissions.

This sort of warming will inundate the Maldives. But it also brings us to a potential tipping point, after which climate change moves beyond man's control.

If we are unable to save countries like the Maldives, it might be too late to save the rest of the world from the apocalyptic effects of self-reinforcing, runaway global warming. The Maldives is the canary in the world's carbon coal mine.

As the West's unforgiving winter starts to bite, you might be forgiven for thinking that a warmer world sounds rather nice. You would be mistaken. Any climate skeptic should read Mark Lynas' book "Six Degrees."

Like Virgil leading Dante through the circles of hell, each one more appalling than the next, Lynas guides us through a warming world, one degree at a time. By six degrees, the inferno of global warming truly roars. Vast swathes of the globe are uninhabitable, as higher temperatures fuel super-hurricanes and widespread winter flooding, while severe summer droughts spark raging wildfires and famine. Temperate northern Europe is on the receiving end of climate refugees in their hundreds of millions.

Last month, the international press reported the previously unthinkable measures the Maldives is taking to insure itself from catastrophic climate change. In the next couple of years I hope to start investing the proceeds of tourism in a sovereign wealth fund. This trust fund will act as a national insurance policy to help pay for a new homeland, should future presidents have to evacuate a country disappearing under the waves.

For the sake of the Maldives and the rest of the world, I hope this fund never needs to be used for its ultimate purpose. I hope instead, that it will pay for future mitigation measures such as reinforcing seawalls and boosting coral reef protection, in a world that has stabilized temperatures to tolerable levels.

But time is running out. The IPCC suggests the world has one, possibly two, decades to stabilize and then drastically cut emissions if we are to avoid runaway climate change. The task will not be easy - particularly if countries fall into a self-defeating game of refusing to cutback first.

But I remain optimistic. If man can walk on the moon, we can take the arduous but surmountable steps needed to decarbonize the world economy. Not to do so would be collective suicide of lemming-like proportions. The time for action is now. For from these paradise islands, I foresee the gates of hell.

Mohamed Nasheed, a former journalist and political prisoner, was elected president of the Republic of Maldives last month.

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