Australia can lead way on climate

Canberra Times
Friday 5/9/2008 Page: 23

Professor Garnaut's original review released in early July was clear that Australia's interests lay in the most ambitious targets for reducing global pollution levels.

When the Garnaut Review recommends targets to davit is important to bear in mind the political realities of the global negotiations which are walking on eggshells toward the deadline for an agreement at the end of next year. At the 2007 Bali climate talks, Australia shrugged off a reputation as a climate laggard and agreed to include the scientific guidance that said developed countries, as a group, needed to reduce carbon pollution by 25 per cent to 40 per cent of 1990 levels by 2020.

In the real world of the climate negotiations our credibility will rest on how hitch we can help to achieve this range. Less ambitious targets will largely deal us out of the chance to be a positive player. Embedded in the negotiations are principles of historical responsibility for current pollution levels and the capacity to act.

These are all principles relevant when countries negotiate their "differentiated responsibilities". Engaging developing countries in agreeing to take on the commitments, the world also needs a global riff on the concept of mutual responsibility defined by these principles.

The most recent talks in Ghana last week ended on a surprisingly positive note, with signs from some developed and developing countries of movement on key issues, including the challenging issue of dealing with genuinely trade exposed industries facing carbon prices. But the talks face their biggest test when countries gather in Poznan, Poland, at the end of the year and developed countries start to put their "target cards" on the table.

Much rests on the targets Australia sets for carbon pollution reduction. Will they be strong enough to help our economy tap into emerging trillion-dollar markets for clean technology? Will they be strong enough to ensure Australia is a credible player in effective global action? Will they help build the trust needed for all countries to take on their fair share of responsibilities in a comprehensive global agreement? Strong action is needed to avoid intensifying droughts, declining water supplies, more extreme bushfires and other climate impacts.

The scope for energy-efficiency improvement and access to low emission energy sources are among the many factors that will influence a nation's ability to reduce emissions. Thankfully, Australia is blessed with massive energy efficiency potential and low-emission-technology sources. Australia can cut at least a quarter off its 1990 pollution levels by 2020, more if a comprehensive global agreement can be agreed at the end of next year.

Climate Institute Australia modelling has shown that, with smart investments, half the emissions reduction can be achieved at a net saving to the economy. The bulk of this lies in untapped opportunities to improve energy efficiency in the residential, commercial and industrial sectors. This includes solar hot water on our roofs, better insulation in our homes and world's-best-practice appliances.

Significant reductions in our energy sector can be achieved with investments over the next decade of around half of 1 per cent of this year's GDP - $46.6 billion. This would unlock billions of dollars of savings through improved efficiency and ensure we are developing the clean technologies hungrily sought by global markets. Stuart investments also need smart policies. A credible carbon pollution-reduction target for 2020, energy-efficiency policies, renewable energy targets and an emissions trading scheme are pieces of the jigsaw.

Some of our biggest polluters want a watered-down emissions trading scheme, others advocate scrapping it in favour of a carbon tax. A simple carbon tax, however, offers no guarantee that pollution would be reduced. It relies on politicians taking a punt on a price that would be sufficient to alter behaviour. Under a cap-and-trade system the cap, or pollution target, is set and the market decides the price of carbon. At the end of the day the target is the key and it is best to have that clear for all to see.

There is no doubt that some businesses will need assistance as we shift our economy to a cleaner, low-carbon footing, but it is in all our interests that this is done, conditional on cleaning tip their operations and being competitive in a world with carbon prices.

With a target of at least a 25 per cent cut in carbon pollution, Australia can be a positive player in negotiations to help achieve global targets and the clean economy so clearly in our national interest. Anything less would return Australia to the climate laggard role we have just shrugged off and leave our kids with a legacy of dangerous climate change.

John Connor is CEO of the Climate Institute Australia.