Petrol rise to control emissions 'unsustainable'

ABC Online, Posted 33 minutes ago 

Updated 22 minutes ago

The economist advising the Federal Government on climate change policy says hiking petrol prices to rein in greenhouse gas emissions is unsustainable in the long term.

Ross Garnaut has delivered a lecture in Canberra outlining the issues he is reviewing ahead of the release of a draft report in July.

He has warned Australia must take responsibility for carbon emissions overseas that result from its exports.

He has rejected any notion that petrol should be exempt from a future carbon emissions trading scheme and suggested higher petrol prices could help mitigate carbon emissions.

But Professor Garnaut says in the long term, hiking petrol prices to control emissions is unsustainable.

"A revolution in humanity's use of fossil fuel-based energy will be necessary sooner or later to sustain and to extend modern standards of living," he said.

"It will be required sooner if we are to hold the risks of climate change to acceptable levels."

Professor Garnaut has also suggested Australia should help developing countries which import our iron ore and coal to reduce the resulting green house gas emissions.

"To protect our coal exports, we have a very strong interest in the development of the cost-effective technologies that will see geo-sequestration of carbon dioxide emissions from coal use becoming a normal part of business and in helping the transfer of that technology to developing countries," he said.

Emissions trading compensation

Meanwhile the Federal Government is hinting big polluters will not be compensated under its national emissions trading scheme.

The Commonwealth will unveil the design of its scheme next month with draft legislation to be released later in the year.

Climate Change Minister Penny Wong will tell a conference in Canberra this morning that the scheme must come at the lowest cost to the economy, and compensation for big polluters may not be a part of the final legislation.

"We are conscious of the impacts on the trade exposed emissions intensive sector and we are also conscious of the potential impacts of households," she said.

"The Government has to balance all these issues and the focus must be economic reform through an emissions trading scheme that enables us to move at least cost to a lower carbon future."

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