ETS amendments unaffordable

3 November, 2009 by

Well there’s a surprise. Because of the high dollar value and the low price of carbon, the government is making excuses in advance for rejecting many of the Opposition’s proposed amendments to the ETS – not that I’m bothered, however. It will then force the Opposition to do what they should have done from the start: vote the abysmal scheme down.

THE Government has flagged it may reject several Coalition amendments to its emissions trading scheme because it will now cost $2.5 billion by 2020.

The Government’s scheme was expected to make $208 million by 2020, but yesterday’s mid-year budget outlook from Treasurer Wayne Swan revealed a big turnaround because of lower likely carbon prices and a soaring Australian dollar.

The Government’s releasing of the figures is a message to the Opposition that not all the proposed amendments, including more free permits to heavy polluting industry and the coal industry, are affordable.

Climate Change Minister Penny Wong is believed to have conveyed this message to shadow resources minister Ian Macfarlane in talks last week.

Notes accompanying yesterday’s release state: ”This [the $2.5 billion black hole] underscores the need for caution in designing assistance measures, particularly those that lead to a permanent increase in scheme costs.”

Opposition spokesman Ian Macfarlane is not surprisingly pretty annoyed at having this dropped in at the last minute:

“This really stretches the friendship … dropping these numbers at a minute to midnight,” said Mr Macfarlane, who has been charged with doing a deal with the government on the ETS before the vote scheduled for late this month.

“It will certainly make the negotiation more difficult – there are areas we are working on where a lack of money could make a difference.“

Read it here and here.

Filed Under: Climate Tagged With: , ,

CSIRO bid to gag ETS attack

2 November, 2009 by

The CSIRO is supposed to be the nation’s top scientific body, but it is up to its neck in the grubby politics of climate change by attempting to silence a critic of the government’s oh-so-wonderful ETS:

THE nation’s peak science agency has tried to gag the publication of a paper by one of its senior environmental economists attacking the Rudd government’s climate change policies.

The paper, by the CSIRO’s Clive Spash, argues the Carbon Pollution Reduction Scheme is an ineffective way to cut emissions, and instead direct legislation or a tax on carbon is needed.

The paper was accepted for publication by the journal New Political Economy after being internationally peer-reviewed.

But Dr Spash told the Australia New Zealand Society for Ecological Economics conference that the CSIRO had since June tried to block its publication.

In the paper, Dr Spash argues the economic theory underpinning emissions trading schemes is “far removed” from the reality of permit markets. “While carbon trading and offset schemes seem set to spread, they so far appear ineffective in terms of actually reducing GHGs (greenhouse gases),” he says. “Despite this apparent failure, ETS remain politically popular amongst the industrialised polluters.

Read it here.

Filed Under: Climate Tagged With: ,

Rudd: Australia will contribute to climate change fund

2 November, 2009 by

Yesterday it was global socialism in the EU, today in Australia, as Kevin Rudd confirms that Australia will contribute to a fund to help developing countries to help “tackle climate change”. Where do those dollars come from? Your pocket. Did you vote for that?

Mr Rudd also conceded a tough road lay ahead for negotiators at Copenhagen after German Chancellor Angela Merkel wrote off the chances of next month’s talks agreeing to a comprehensive successor to the Kyoto treaty. EU leaders agreed at the weekend to call for a global fund to total €100 billion ($161bn) by 2020 to pay developing countries to combat climate change, but failed to agree on how much money it was prepared to put into it.

Mr Rudd said yesterday Australia would play a role in helping to fund the project.

“Look, I have worked very closely with Chancellor Merkel in recent months on both climate change and a whole range of global financial challenges, and she is a strong and active contributor to trying to forge consensus for Copenhagen,” he said. “Negotiations are really tough, that is absolutely right, and I’ve been completely up front about that, and they’ll continue to be tough.”

On the subject of the fund, Mr Rudd said: “Australia, once a global agreement is shaped, would always be prepared to put forward its fair share. At this stage there’s no global agreement as to what long-term financing arrangements should underpin a deal at Copenhagen for emerging and developing economies.

And then of course there is the pious plea to the Opposition to pass the ETS:

“And I would appeal to all fair-minded Liberals, all fair-minded conservatives, that this is a national interest question which literally should transcend politics for the next 20, 30 and 50 years.”

Literally.

Read it here.

Filed Under: Climate Tagged With: , ,

Strong Aussie dollar hits ETS bottom line

1 November, 2009 by

But you can guarantee that the Treasury modelling will massage the figures to make it look like everything is rosy in the ETS garden:

THE resurgent Australian dollar and strong commodity markets have slashed by more than $10 billion the expected revenue from the emissions trading scheme over the next decade, dramatically reducing the government’s scope to accept Malcolm Turnbull’s amendments.

Ten-year costings for the ETS, expected to be released with the government’s mid-year economic forecasts next week, are likely to show that instead of the $11bn surplus estimated by independent forecasters by 2020, the ETS could run at a loss in many of those years and require top-up funding from the budget.

A large or ongoing deficit would contradict government promises that the scheme will over time pay for itself, and jeopardise promised compensation to businesses and households from revenue raised from selling emissions permits.

And the good news is that this may prevent the Government from being able to negotiate with the Opposition, forcing them to vote it down:

The forecast estimates will dramatically lessen the chances of a deal in ETS negotiations between the government and the opposition, ahead of the second Senate vote late next month when the laws could become a double-dissolution trigger.

The Coalition could reject Kevin Rudd’s proposed carbon emissions trading scheme next month even if the Prime Minister accepts all of Malcolm Turnbull’s proposed amendments.

Senate leader Nick Minchin said yesterday there was no guarantee the Coalition partyroom would accept any agreed proposals, sparking government claims the opposition was acting in bad faith in negotiating with it over amendments.

Read it here.

Filed Under: Climate Tagged With: ,
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