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May 30, 2011
My judgement is that climate change is now the central public policy issue that needs to be addressed by the current Parliament. It looks simple on the surface doesn't it: both Labor and the Coalition claim a reduction target of 5 per cent from 2000 levels by 2020 and that they are simply arguing about the best mechanism to get there. It's either carbon tax leading to an emissions trading scheme, or direct action funded out of the budget.
Dig beneath the surface and it gets more complicated. Many in the Coalition are still deeply opposed to the IPCC's evidence of man-made warming, have adopted an anti-science position and demand that their personal opinion be taken as seriously as the objective evidence from scientific research.
The anti-science noise is from the carnival barkers at the seedy-looking sideshow in a tacky fairground full of astrofurfers. The main game is in the public policy arena and it is the negotiations taking place within the Multi Party Committee on Climate Change (MPCCC).
Here the debate is about a carbon price mechanism that could commence with a fixed price (through the issuance of fixed price units within an emissions trading scheme) before converting to a cap-and-trade emissions trading scheme. The last meeting issued a number of working papers, which I cannot find online.
The negotiations appear to be between the Gillard Government and Big business groups with the latter, as expected pushing for a very low starting price for carbon. The proposal would be something along the lines of a fixed price for three to five years followed by a floating price. If a low starting price is what is agreed to, then that means a step trajectory in the price of carbon to meet the 5 per cent from 2000 levels by 2020.
Of course, Big Business has no intention of trying to meet that target, nor the goal of preventing a temperature rise of more than 2 degrees Celsius – which scientists say is the threshold for potentially "dangerous climate change". Australia's emissions levels keep on increasing, the electricity generators and coal industry are talking in terms of an anti-carbon tax campaign and they want more coal fired stations to be built.
The hard reality is that Australia's seconomy runs on energy, and since most of that power continues to comes from coal, oil and gas, GDP and carbon emissions will be bound together in an economic growth lockstep---Australia's economy is expanding again and belching out more carbon.
Update
In his final report ---Garnaut Review 2011--- Garnaut recommend polluters pay a carbon price of $26 a tonne, raising $11.5 billion in the first year of a carbon tax. Garnaut says 55 per cent of the revenue should go to households and 35 per cent to the polluting businesses as compensation.The remainder will go towards innovation and carbon farming, which will be offset by existing spending. The move to a full floating-price emissions trading scheme should be made in 2015
I await the howls of outrage from the special interests opposed to reform. They are unwilling to pay for the real cost of their carbon pollution--- ie., charging for CO2 emissions--- and are unwilling to invest in clean technology options. Their politics is one of continuing to not to pay a price for continuing to pollute. The Liberal Party supports them.
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If we shift to the global economy then greenhouse gas emissions increased by a record amount last year, to the highest carbon output in history. Last year, a record 30.6 gigatonnes of carbon dioxide poured into the atmosphere, mainly from burning fossil fuel – a rise of 1.6Gt on 2009, according to estimates from the IEA.
Global greenhouse emissions are now close to being back on a 'business as usual' path. According to the Intergovernmental Panel on Climate Change's projections, such a path would mean around a 50% chance of a rise in global average temperature of more than 4C by 2100.