Leaders fiddle while the world burns

Sydney Morning Herald
29 January 2011, Page: 16

THE word is, new modelling is being done on a 10% by 2020" target for greenhouse gas reductions - double that of last year - suggesting that, despite all the wailing, the climate debate moves only one way: ever more pressing, ever more expensive. Even so, the question of targets is in the too - hard basket of the Climate Change Minister, Greg Combet. At a speech to institutional investors in Sydney before Christmas, Combet was keen to emphasise the government could initially put a price on carbon - say at a fixed, rather than market rate - without stipulating an emissions reduction target.

That would skirt an ugly stoush with the Greens, soon to hold the balance of power in the Senate, as Combet later explained: "What's evident from the debate we've had over the last few years is it's certainly going to be testing for the government and the Greens to ever come to an accommodation over the level of the target. So what I'm really saying is we need to focus on the carbon price mechanism and not go down [the path of] an argument that can't be resolved over targets".

It seemed possible the Gillard government had a cunning plan to tackle climate change in 2011: put exactly the same emissions trading scheme back to the Parliament and dare the Greens to block it again. How bad would the Greens look: making easy yards on gay marriage and ATM fees,.. deadset against action on climate change!

Combet certainly sounded that way last month, paying tribute to the "top - quality" work done by his department in developing the failed Carbon Pollution Reduction Scheme of 2009, concluding "we won't need to reinvent the wheel". But for now there seems a willingness on both sides to try to avoid the Labor - Greens stalemate witnessed last time around, strike an agreement this year and aim for implementation by mid - 2012. The Greens leader, Bob Brown, certainly believes there is room for compromise.

The then secretary of the Department of Climate Change, Dr Martin Parkinson - now head of the Prime Minister's own department - said after Combet's Sydney speech that the government was "not putting CPRS 2.0 out there". It's just that in the design of the new carbon price, whatever form it takes, a lot of the fundamental analysis, reporting framework and so on has been done.

Targets isn't the only thorny issue the government is tippy toeing around. A Citigroup analyst, Elaine Prior, threw Combet a two pronged question about (a) whether a carbon price might at first be imposed just to cover the electricity sector, the source of most emissions; and (b) the level of compensation for emissions - intensive, trade - exposed industries such as steel and aluminium, and the electricity generation sector in the transition phase.

"I'm wondering", she said to nervous laughs, "whether the negotiations held a year ago in terms of transitional assistance, whether that was likely to be as good as it would get for industry - whether the current makeup of Parliament means perhaps industry will regret not agreeing, in a sense, to the proposals that were put forward last year?" Without a pause, and to more laughter, Combet replied that was a "highly pertinent question that as a budding politician I'd sidestep a bit".

Which he expertly did: these after all are some of the most sensitive issues before the multiparty committee on climate change and Combet wasn't going to preempt that process. The meeting broke up with a good sense that the minister was getting on with it.

But the body doesn't lie and it was the last question at the subsequent press conference that dried Combet's mouth. How is doubling our coal exports consistent with action on climate change? Combet's answer: "Coal is extremely important to our economy and it's one of the reasons why in fact I had a number of discussions to this effect with my counterparts [at the latest UN climate talks] in Cancun there is a great degree of interest in trying to develop things such as carbon capture and storage technology, which our government has got behind very firmly, because the future for fossil fuels ultimately will also be dependent on our capacity to utilise them on a much lower emissions pathway. So improving energy efficiency in coal fired power stations, improving our capacity to explore CCS technology, will all be very important".

The truth? It just isn't. A real climate policy would see the government stepping in where the states won't: denying export approval for new coalmines. In response to the floods, as the Climate Institute points out, we'd be axing fossil fuel subsidies which are part of the problem like the diesel fuel rebate and fringe benefits tax for car use instead of funding for solar power stations, which is part of the solution.

A real climate policy would see Australia target emissions reductions of at least 25% by 2020 our fair share of the effort needed to give us all a 2 in 3 chance of keeping warming below 2°, as world leaders agreed at Copenhagen. And that's being optimistic. Policy - makers are now thinking in earnest about a world that is 4° warmer by 2070 - 2100 as we're tracking if every country does everything they've promised so far and the scenarios are apocalyptic. There is no science on how we might adapt.

paddy.manning@fairfaxmedia.corm.au