After nearly 200 countries reached a deal at the end of United Nations climate talks in Warsaw, Poland, Australia’s conservative Liberal-Nation government now has a deadline of early 2015 to set a target for reducing carbon emissions.
At the same time a peak industry body says a central part of the government’s climate change policy will not always work.
The Warsaw UN Conference of Parties (COP19) ended with an agreement on a timetable for nations to name their emissions cuts before a major treaty meeting in the French capital, Paris, in December 2015.
The Paris meeting aims to produce an international agreement that will come into place in 2020 to replace the Kyoto Protocol.
Australia’s Liberal-National government is seeking to repeal the country’s current carbon price laws and replace them with a proposal to pay polluters to reduce emissions under its $1.5 billion Emissions Reduction Fund.
It wants that process completed and up and running by July next year.
In its submission on the scheme, industry lobby group Australian Industry Group (AiGroup) said companies were not always going to be able to deliver as planned.
While the Government wants the fund to target domestic emissions, AiGroup is urging it also to include international carbon emissions.
Chief executive Innes Willox told ABC News the government should spend a portion of the allocated budget on the reserve of international carbon credits.
“We need to get our emission reductions done at least cost,” he said.
“This is one way of doing it. This is also a fallback in case the emissions reduction fund, for whatever reason, doesn’t deliver on the outcomes that it seeks.”
A reverse auction would be at the centre of the fund, involving companies and landholders competing against each other for funding to reduce emissions.
Mr Willox said such a scheme carried risks.
“Some winners in auctions aren’t going to be able to deliver what is promised because changed market conditions or the like between the purchase of abatement and project delivery,” he told ABC News.
“There are a lot of variables at play here, so that’s why the purchase of international abatement is a very prudent fallback for the government to consider.”
Australia’s current target is to reduce emissions by five per cent by 2020 and the Climate Change Authority is recommending that it be at least 15 per cent.
Many other countries have much higher targets and the European Union is currently looking at a target of between 35 and 50 percent for 2030.
Ai Group says its proposal is a “prudent fallback” in case that target cannot be reached or if the government wants to go further than five per cent.”
Mr Willox also says the timeline is short for such an ambitious policy and does not provide enough opportunity for careful consideration of key parameters.
Several groups, including AiGroup failed to meet the November 18 deadline for first submissions.
“This a very tight time frame that we’re working to,” Mr Willox told ABC News.
“There’s a clear consultation process that the government’s put in place that we welcome, but it will be tight.”
Federal Environment Minister Greg Hunt was unavailable for comment.
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