Major Set Back in Australian Emissions Trading Scheme Legislation
Melbourne, Victoria, Australia - The current Australian Government, led by Prime Minister Kevin Rudd, has been working frantically since the Prime Minister took office to prepare Australia for a greenhouse gas reduction strategy. Australia, which has a large stake of its economy investing in energy intensive industries such as mining and aluminum smelting, and a heavy reliance on coal for its energy, has a big task ahead.
The Government has put in place a range of measures to try to reduce carbon emissions, including legislation which commits Australia to increase its renewable energy contribution by 20% by 2050, and mechanisms to encourage energy efficiency and research into new technologies. It is debatable on whether the Government is doing enough in this area, however the area that has attracted the most media attention in Australia, and abroad, has been around the implementation of the Government's major climate change policy, the Carbon Pollution Reduction Scheme, or CPRS.
In the lead up to the meeting of all world leaders in Copenhagen (COP15, 7 December to 18 December 2009) to discuss international action on Climate Change, the Australian Government had a major set back in the week of 30 November 2009 as the legislation for its Emissions Trading Scheme (ETS) (known as the CPRS) failed to pass through the Senate. This was primarily due to a deep rift in the Opposition party which saw the current leader of the Opposition, Mr Malcolm Turnbull, who supported the CPRS legislation, ousted by his party and a new party leader elected. The new party leader, Mr Tony Abbott, is unimpressed with the Government's CPRS as he believes it would impose unacceptable costs to the Australian community, and he will seek a different strategy, other than an ETS, to reduce Australia's emissions. This was a major blow for Prime Minister Rudd, who had wanted to go to Copenhagen with the legislation passed in the hope that this would encourage other nations to take up similar schemes to reduce emissions. Given the fact that the meeting of COP-15 was unsuccessful in setting binding global emissions targets, it will be interesting to see if Australia will change tack, and instead implement a straight forward carbon tax, as has been operating in Denmark for some years, or whether the Government will push ahead with another amended CPRS.
For further information contact Peter Clark, Peter J Ramsay & Associates, peter.clark@pjra.com.au