PM pitches `mini' carbon trade trial at businesses

West Australian
25/09/2007 Page: 5

Australian businesses could be trading carbon as early as next year in a mini trial scheme designed to help them find ways to reduce greenhouse gas emissions ahead of a national program due to start in 2011. John Howard yesterday invited stakeholders to participate in discussion over the next few months to determine the best way to trial emissions trading to ensure the Government gets it right when it implements the full scheme in four years' time.

"Our decision to establish a national emissions trading scheme entails detailed design on a highly complex issue," the Prime Minister said. "It is a significant economic reform and one which we have to get right through rigorous modelling and analysis. " In releasing the discussion paper, Mr Howard said the trading scheme's key details would be finalised next year. The early abatement plan would see permits issued for trading actions, which began after June this year, that reduce greenhouse gas emissions.

The initiative will encourage companies to start cutting emissions now rather than when the scheme begins. Mr Howard showed concern that his July announcement for a 2011 emissions trading program had given companies an excuse to do nothing until the scheme begins. His comments came a day after the Government announced a clean energy target to generate 15 per cent of the nation's energy from renewable sources and clean coal by 2020. But Mr Howard was criticised yesterday for fudging the numbers - critics said his plan didn't add up.

Greens Senator Christine Milne said the Government's new target of 30,000 gigawatt-hours a year of electricity coming from low-emissions sources amounted to only nine per cent of the nation's expected use. The Australian Bureau for Agriculture and Resource Economics projection for energy demand in 2019-20 is 342,000 GWh. "Where's is the extra six per cent?" Senator Milne said. "Either the Government is including significant, and as yet unannounced, energy efficiency measures into their calculations or they are deliberately using rubbery figures and hoping nobody examines them closely." The current Mandatory Renewable Energy Target is 9500 GWh, which amounts to little more than one per cent of total electricity generation.

That is on top of the pre-MRET regulations where 16,000 GWh is already produced from the country's major hydro schemes. Even adding that original MRET baseline to the new target, and factoring in Australia's increasing demand for electricity, it still leaves it way short of 15 per cent of total electricity use. The Government acknowledged yesterday that the increase to the MRET would add about 1.5 per cent to household energy bills.

Opposition Leader Kevin Rudd said Mr Howard had failed to act on climate change and renewable energy for his entire 11 years in Government and this announcement was a desperate election-eve stunt. Mr Rudd said that the Government had let the renewable energy industry run down in Australia.