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‘Direct Action’ could meet emissions target if Coalition allows changes


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Talks have been under way to find a ‘grand bargain’ to allow an amended scheme to pass. Photograph: Julian Smith/AAP


Powered by Guardian.co.ukThis article titled “‘Direct Action’ could meet emissions target if Coalition allows changes” was written by Lenore Taylor, Guardian Australia political editor, for theguardian.com on Sunday 24th August 2014 14.01 UTC

Extensive changes to the Abbott government’s “Direct Action” climate change policy being proposed by independent senator Nick Xenophon could bring it within reach of meeting Australia’s 2020 emissions reduction target, new research shows.

The research, by Reputex, found that without amendment, the $2.55bn fund – which the government will seek to pass through the Senate this week – will fall drastically short of meeting Australia’s target of reducing emissions by 5% by 2020, compared with 2000 levels.

But among the proposed changes are measures the government has categorically rejected, including allowing the purchase of some international carbon credits (the prime minister once described the idea as sending “money … offshore into dodgy carbon farms in Equatorial Guinea and Kazakhstan”) and putting teeth into the government’s deferred “safeguards mechanism” which would impose penalties on electricity generators or manufacturers who exceeded normal emission levels. (This has been fiercely resisted by industry and could also push up power prices.)

And the projections also rely on retaining the renewable energy target, while the government is torn between dramatically paring it back, or closing it to new investments.

As it stands the “Direct Action” plan – presented in the form of amendments to the existing carbon farming scheme – is facing defeat with the opposition of Labor, the Greens, the Palmer United party and other crossbench senators.

But as reported by Guardian Australia at the weekend, talks have been under way behind the scenes to find a “grand bargain” that might allow the passage of an amended scheme. Xenophon’s proposals are one of the options being considered.

Reputex says the emissions reduction fund, as it is designed, would buy only 67 million tonnes of greenhouse abatement and leave Australia 354 million tonnes short of its 2020 target. With the amendments it would be about 128 million tonnes short.

The environment minister, Greg Hunt, insists the fund, as it stands, will “easily” meet the 2020 target.

Among the amendments proposed by Xenophon and modelled by Reputex are:

* A clear pledge to spend another billion dollars before 2020. The budget contains $1.15bn for the fund between now and 2017-18. The amendments propose that another $1bn originally promised by the government be spent in the following two years before 2020.

* Tougher “safeguards” – with companies penalised for failing to meet an emissions baseline and credited for doing better – an idea that over time could start to look like a version of an emissions trading scheme. The “safeguards” designed to stop industrial emissions increasing and wiping out any emission reductions bought by the emissions reduction fund have been fiercely resisted by industry and were left out of the initial legislation to go to parliament this week, after cabinet could not agree to them. Reputex says the Xenophon amendments propose that they be implemented immediately.

* Longer contract periods for organisations bidding in to the emissions reduction fund.

Xenophon said he had “put in a lot of hard work and engaged in a lot of tough negotiations with the government in good faith” over the amendments.

Asked whether he believed cabinet would agree to impose penalties on polluting industries or to retain the renewable energy target he said, “My plea to those in the Coalition who think that way is that there are many swinging voters who want to see Australia credibly reduce its emissions in a cost-effective way.”

According to the research, Australia will not meet its targets without the existing renewable energy target.

Keeping the RET has not been an option for the government, which has now received the report from a review headed by businessman and self-professed climate sceptic Dick Warburton.


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