Risking polluted policies

Herald Sun
Thursday 19/3/2009 Page: 66

REVELATIONS this week by climate policy expert Dr Guy Pearse that the Construction Forestry Mining and Energy Union was the biggest donor to the ALP's 2007 campaign coffers have again raised questions in some circles about the union's influence in Senator Penny Wong's climate change portfolio. Senator Wong was once powerful in the CFMEU's timber workers division.

Sensibly dismissed by the union and Dr Pearse, the theory has re-emerged as the senator's critics continue their struggle to understand how her climate policy could go by the name of a carbon pollution reduction scheme, yet do so little to encourage emissions cuts. The argument goes that the senator's climate policies favour big polluters who employ CFMEU workers, and that these unionists want to preserve the jobs status quo, therefore they are all in bed together.

CFMEU national president Tony Maher told this column yesterday the speculation was a "hopeless joke" and that the union donated "much more" than $700,000 "to make sure the Howard government didn't get back in", not because it wanted to script a Rudd government climate policy. Thanks for clearing that up, Tony.

Meanwhile, Dr Pearse's beef in his Quarterly Essay titled Quarry Vision continues to be the intricate links between big polluter lobbyists and policy makers. In his 2007 book High and Dry, he named and shamed well-paid, well connected lobbyists he said shaped the Howard Government's weak position on climate change.

In his latest critique, he details how the same lobbyists are still working their magic with the Rudd Government, to the detriment of renewable energy opportunities that can create thousands of clean jobs and anchor profits in the Australian economy. He concludes that Senator Wong's policy will aid polluters to continue to belch toxic carbon here and "offset" that pollution by buying cheap carbon credits overseas. Further, the rest of us will pick up the tab as the cost of carbon is distributed through the economy.

The essay could have gone further to reveal that lobbyists for the big polluters have diverted attention from these facts, too:

• More renewable energy in the grid lowers the average wholesale price of electricity over a year by eliminating the need to fire up expensive gas power plants during peak demand episodes, when coal fired generators break down or are shut down for maintenance.
• Victoria's biggest coal-fired generators are owned by foreign companies that divert profits they make here to China, Japan and Britain, and still they will qualify for $2.2 billion of aid in the first few years of emissions trading.
• The national economy now provides the energy and transport sector freebies worth about $10 billion a year, made up of many subsidies including cheap electricity for aluminium smelters and cheap fuel for coal power.
• Based on a price of $25 a carbon tonne, the emissions trading scheme will next year provide $940 million in free permits to aluminium smelters, $300 million to petroleum refiners, $260 million to steel, $250 million to alumina refiners, $180 million to LNG producers and $160 million to cement makers.

That is another $2 billion of freebies, conceded by other industries, for just one year. Multiply that by many more years and a clearer picture emerges of just how much the rest of the economy is paying to allow polluting industries to maintain business as usual, while stifling innovation.