Monday, March 9, 2009

ETS unduly influenced by industry: Garnaut

By Liz Jackson for Four Corners

ABC Online, Posted Mon Mar 9

The Federal Government's climate change adviser has criticised the controversial emissions trading scheme (ETS), a day before the Government releases the scheme's draft legislation.

The author of the Garnaut Climate Change Review, Professor Ross Garnaut, has told ABC1's Four Corners that he is disappointed with the scheme.

In a report that will air on ABC1 at 8:30pm tonight, Professor Garnaut says he is concerned that vested interests have had an undue influence on the scheme's design.

He has detailed his concerns about the amount of money, influence and clout that has been brought to bear on particular aspects of the ETS.

"There's no doubt that that there has been a huge investment in seeking to influence a number of aspects of the design of the emissions trading scheme," he said.

"Vested interest seeking to influence the process is not illegitimate in our democracy, but it can lead to poor policy outcomes."

By vested interests, Professor Garnaut is referring to those industries which are the highest emitters of greenhouse gas, and which stand to lose if the scheme is not tailored to their wants.

"Especially in the short term; they may not lose in the long term, but some interests care more about the short term than the long term," he said.

But Professor Garnaut's primary concern is that the Government's emissions reduction targets are too low.

The Government has said it will commit to reduce Australia's emissions by between 5 per cent and 15 per cent, depending on what others countries commit to at the Copenhagen conference later this year.

The Garnaut Review recommended that Australia should be prepared to cut up to 25 per cent in the context of a global agreement.

Professor Garnaut has told Four Corners that by ruling out greater cuts, Australia has hindered a global consensus.

""We've made it very difficult for Australia to play a positive role in moving the world towards an ambitious outcome," he said.

"Other countries are saying that we've set our sights very low and that makes it harder for other countries to set their sights high."

Industry concerns

Professor Garnaut is also critical of the manner in which the Government has chosen to compensate those industries that pollute the most.

He accepts that those industries which are vulnerable to decreased profit because of the scheme should given compensation.

But he says the Government has been "rewarding pressure from vested interests" and that the use of 'free permits' as compensation to the highest polluters has gone too far.

Four Corners took Professor Garnaut's concerns to industry groups that are among the highest emitters of greenhouse gas pollutants.

These industries expressed the view that the Government's scheme has imposed too heavy a burden on them and has not given them enough free permits. They too feel the debate is far from over.

The Coal Association's executive director, Ralph Hillman, feels especially aggrieved.

He has told Four Corners the coal industry will pursue free permits to an amount of over $1 billion and he says the present economic climate aids the industry's case.

"We have a very solid case and I think Australia's circumstances and global circumstances have shifted in a direction that will make that more likely," he said.

But Professor Garnaut says the global financial crisis is not a reason to slow down the process of shifting away from a carbon-intensive economy, but rather is a good time to act.

"We're talking about the introduction of an emissions trading scheme in the middle of 2010," he said.

"And by that time, if the policies of Australia, the United States, the Europeans, the Chinese are having their desired effect, we will have moved from a deep recession into a period of expansion, and the period of recovery from a recession is actually a very good time for investment in structural change."

Senate showdown

As the Government's scheme heads for a showdown in the Senate, Greens Senator Christine Milne says the Greens will oppose the scheme unless the Government "greens it up".

"In its current form, it is difficult to see how anyone who was really serious about climate change could actually support it," Senator Milne said.

The Coalition says it will oppose the scheme unless it includes free permits up to the level of 100 per cent for the highest emitters.

The Opposition's spokesman on emissions trading, Andrew Robb, says there should be no cost impost on the high-emitting industries that will be hit by the scheme.

"The scheme that we took to the last election, which was an emissions trading scheme, is still our policy. It gave 100 per cent free allocations of permits up to world's best practice," he said.

Just over a year ago, Australia was given a standing ovation at the United Nation's Climate Change Conference at Bali after ratifying the Kyoto Protocol on climate change.

But what will be Australia's commitment at the climate change conference at Copenhagen later this year?

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