Australia delays emissions trading

Amy Coopes Yahoo News 4 May 09;

SYDNEY (AFP) – Australia on Monday increased concessions for big polluters and delayed the start date of its emissions trading scheme because of the global financial crisis, in a stark shift on climate policy.

Prime Minister Kevin Rudd said the deepening global recession meant local emissions trading could not begin until July 2011, one year later than previously planned.

In a concession to green groups, Rudd said Australia would cut its greenhouse gas emissions to 25 percent of 2000 levels by 2020 -- up from 15 percent previously.

But he said the revised target would only apply if world leaders also signed up to an "ambitious" reduction goal in Copenhagen in December. Without an agreement, Australia's target will remain unchanged at five percent.

"The worst global recession since the Great Depression means we must adapt our climate change measures but not abandon them," Rudd told reporters.

"The start date of the carbon pollution reduction scheme will be delayed one year to commence from July 1, 2011."

It was a marked change in position by Rudd, who has for months insisted his government would proceed with emissions trading in 2010, despite the global market turmoil.

With Australia already suffering its worst drought in a century, the prime minister said late last year that failure to act on climate change could be disastrous, labelling any delay "reckless and irresponsible".

But in a change of tack, Rudd pushed back the trading scheme start date and said a one-year fixed-price period for carbon pollution permits would apply until July 2012 to assist businesses hit hard by the credit crunch.

Rudd said that during the fixed-price phase, an unlimited number of permits would be issued to eligible companies at a price of 10 dollars (seven US) per tonne.

He also said a "global recession buffer" would be provided for emissions-intensive trade-exposed industries, extending their pollution allowances for a "finite period".

Rudd won office on a strongly pro-green platform in late 2007 and the delay means the politically-contentious emissions trading scheme, which critics say will cost jobs, will not begin until after the next election in late 2010.

The prime minister rejected claims the changes softened his centre-left government's stance on climate change, saying the slower start would mean a "stronger, greener conclusion".

"I believe (this) is the most sensible, rational, balanced response to a fundamental change in economic circumstances," Rudd said.

If agreement was reached in Copenhagen to stabilise carbon dioxide levels in the atmosphere by at least 450 parts per million by 2050, Rudd said Australia would reduce its emissions by 25 percent by 2020.

Such an agreement would mean it was possible to save the Great Barrier Reef, Rudd said, adding that Canberra would agree to realise five percent of its commitment by purchasing international carbon credits.

Rudd, who ratified the Kyoto Protocol as his first act of government, is now faced with the task of pushing his climate laws through a hostile parliament.

Opposition party leader Malcolm Turnbull said he would not support the amended scheme, which he described as a "massive backdown" and "panic response" to criticism.

The minority Greens party accused Rudd of "browning down" his stance by giving major polluters 2.2 billion dollars in free permits, and described the revised 25 percent target as an "almost irrelevant green distraction".

Greenpeace said the concessions to industry "reek of industry lobbying" and the new scheme fell dismally short of what was required to effect real change.

But other conservation groups welcomed the pledge to more sweeping targets, while business groups commended Rudd for delaying the scheme and recognising the challenges of the economic crisis.

Australia delays emissions scheme
BBC News 4 May 09;

The Australian government says it will push back a planned carbon emissions trading scheme (ETS) by a year.

Prime Minister Kevin Rudd said the delay was necessary because of the poor economic climate.

But he also suggested that Australia could pursue tougher emissions reductions targets if an international deal was reached.

The ETS, which has been criticised by both industrial and environment groups, was due to launch in July 2010.

Business say the scheme will delay economic recovery and lead to job losses. The environmental lobby, meanwhile, says that the targets are not tough enough.

Australia has the highest per capita emissions in the developed world and coal is its biggest export.

'Appropriate response'

In a speech in Canberra, Mr Rudd said that the carbon trading scheme - requiring industrial polluters to buy licences to emit carbon - would be pushed back until July 2011.

"The worst global recession since the great depression means we must adapt our climate change measures but not abandon them," he said.

A one-year fixed price period would be introduced for the first year, he said, with carbon permits costing A$10 ($7, £5) per tonne, followed by a floating price until July 2013.

"This, we believe represents an appropriate response to current uncertainty," he said.

But - in a move aimed at the environment lobby - Mr Rudd said that the range of the emissions reduction target could be increased up to 25% of 2000 levels if other nations agreed similar targets.

The previous target was to reduce emissions by between 5 and 15% of 2000 levels by 2020.

Mr Rudd needs the support of Greens senators to pass the carbon trading legislation.

He admitted that he had been under pressure from industry and the resources sector to delay the scheme, reports the BBC's Nick Bryant, in Sydney.

He also conceded that there had been international pressure on Australia to make deeper cuts in emissions.

The policy changes reflect the difficulties of reconciling the needs of the domestic economy against global expectations, our correspondent says.

Australia's Tougher CO2 Target Good For Climate Talks
David Fogarty, PlanetArk 5 May 09;

SINGAPORE - Australia has given UN climate talks a boost by saying it could toughen emissions targets by 2020, something developing countries want from richer nations as the world tries to seal a broader climate pact.

But the government also bowed to industry demands as it announced on Monday a delay to the start of emissions trading by a year until July 2011, raising doubts that fighting climate change was still top of the political agenda amid a recession.

Australia has tried to project itself as a leader in UN climate negotiations and emissions trading since Prime Minister Kevin Rudd won office in late 2007 and ratified the Kyoto Protocol as his first official act.

But the world's top coal exporter, and a big producer of steel, aluminium and liquefied natural gas, is now more of a laggard as it struggles to cut the nation's carbon pollution, among the world's highest per capita.

"Australia has delivered a mixed message to the rest of the world. A delayed start to the emission trading scheme suggests a reduced importance of tackling climate change," climate policy and development expert Matthew Clarke told Reuters.

"However, the increased reduction target highlights a strong commitment to reducing Australian carbon emissions," added Clarke, of the School of International and Political Studies at Deakin University in Melbourne.

The government said it would back a 25 percent cut in emissions from 2000 levels by 2020 if other rich nations agreed something similar as part of deal at the end of the year to replace the Kyoto Protocol.

The previous range of 5 to 15 percent is well below the UN Climate Panel's finding that developed nations need to cut their emissions between 25 to 40 percent below 1990 levels by 2020.

Delegates from nearly 200 nations meet at the end of the year in the Danish capital to try to agree on the broad outlines of a pact to replace Kyoto from 2013.

EYES ON THE TARGET

China, India and other big developing nations have demanded cuts of 25-40 percent as well as substantial funding for climate change adaptation and transfer of affordable clean-energy technology to earn their support for a post-Kyoto deal.

The administration of US President Barack Obama is also trying to get emissions trading legislation through Congress and will be eyeing closely what Australia is doing.

"The fact the government's signalled 25 percent, which is still very difficult to achieve, that will seen as positive by the United States," said Greg Bourne, CEO of environmental campaigners WWF-Australia.

"They won't care about the emissions trading scheme slowdown," he told Reuters. "They'll see that as just a pragmatic thing to do during a global financial crisis and they may have to do something similar."

Obama has pledged to cut US emissions back to 1990 levels by 2020, or about 15 percent down from 2000 levels.

Academic Ian Lowe, president of the Australian Conservation Foundation, described the 25 percent target as a significant step forward.

"It puts Australia in a leadership position along with the EU in relation to developed countries targets which will be crucial for a sound Copenhagen outcome," he said. The EU backs a 20 percent emissions cut by 2020 from 1990 levels, up to 30 percent if other rich nations agree on deep reductions.

Yet doubts remain on the strength of Australia's commitment.

"The global financial crisis may now be seen as a reason to delay action on climate change. Therefore, pressure to deliver a post-Kyoto agreement at Copenhagen at the end of this year may now be reduced," said Clarke in a response to questions emailed by Reuters.

The Australian Greens, whose support for the emissions trading laws in the Senate will be crucial in coming weeks, said the 25 percent target was not good enough. "The Rudd Government has put such stringent conditions on their 25 percent target that no-one internationally could have any faith that they will actually move," Australian Greens Deputy Leader Senator Christine Milne told Reuters.

Others said the decision to delay the carbon scheme was not a sign Australia was shying away from cutting emissions.

"Given that what we are negotiating internationally now is not scheduled to enter into force until 2013, we are not so concerned with the one-year delay in the Australian trading scheme," said Kim Carstensen, the head of WWF International's Global Climate Initiative.

"We see the new Australian announcements as a clear signal to the world -- and also to Australia's citizens and industries -- of the direction and the level of ambition we can expect, and that is the most important thing."

(Editing by Michael Urquhart)