Australian businesses want a more ambitious national climate policy, backing a target of net zero emissions by 2050 and are raising concerns about the lack of a coordinated energy policy and the conservative Liberal-National government’s plan to use carry-over credits from the Kyoto Protocol.
The Carbon Market Institute (CMI) has today released the findings of its annual business survey, with 94 per cent of respondents saying Australia’s policies are not enough to reduce emissions in line with the 2030 United Nations sponsored Paris Agreement target.
The survey of 220 business and industry leaders includes people from the mining, oil, gas and manufacturing sectors.
More than a third work for companies with such high greenhouse gas emissions they have to report the levels to government.
CMI said “the risks posed by climate change to business are well known, both material financial and strategic, with 84 per cent of survey respondents revealing their organisation recognises these risks at board and executive management levels.
“Forty-two per cent reported increased shareholder engagement regarding climate change for their organisation in the past 12 months.”
Nearly all respondents, 96 per cent, think the longer Australia puts off decarbonising, the more abrupt, forceful and disruptive the policy response will be.
A similar number do not think Australia’s policies in the area provide high emitting companies a stable environment for long-term investments.
“Australian businesses are grappling with the knowledge that science requires net-zero emissions by 2050, policy volatility, evolving global carbon markets, investor calls for action and reporting requirements such as those from the G20 Financial Stability Board’s Task Force on Climate-related Financial Disclosures,” said John Connor, CEO of the CMI.
Mr Connor said the survey shows many Australian businesses are planning to transition towards net-zero emissions.
“Business is looking for more ambitious climate policies to set a defined pathway and assist them in managing this,” he said today.
“We are seeing a gap between business expectations and government policy, and it is concerning business.”
More than 80 per cent of respondents think Australia should have a net-zero emissions by 2050 goal.
Slightly less, 76 per cent, don’t think the nation should be allowed to use so-called Kyoto Protocol “carry-over credits” to achieve emissions reduction targets.
Seven per cent think Australia should be able to, while 17 per cent were on the fence.
United Nations climate talks recently held in Spain were poised to deal with the issue of whether or not Australia could use the credits, but the rules have not been settled.
The carry-over credits let the government use past achievements towards the Paris Agreement target of 26 to 28 per cent reduction in emissions by 2030.
Without carryover credits Australia is not on track to meet its 2030 emissions reduction goal, and would probably only achieve about a 16 per cent reduction.
The centrepiece of the Liberal-National government’s plan to reduce emissions is the Emissions Reduction Fund, where companies are paid by taxpayers to reduce their pollution using certain methods.
About 70 per cent of survey respondents do not believe the list of approved methods is enough to cover the most viable ways of emissions avoidance and carbon abatement
Slightly more think the government should put more money towards research and development in the emissions reduction and carbon farming space.
In the past year, 42 per cent of respondents said their organisations faced increased shareholder action regarding climate change.
Yesterday, the energy minister, Angus Taylor, told the Australian Financial Review newspaper that Australia could possibly meet its abatement targets without the use of carry-over credits, claiming the government was already “over delivering”.
However, a government report released last month showed the government was relying on the accounting loophole, with Australia expected to achieve just a 16 per cent cut below 2005 levels by 2030 if it did not use the credit.
The carryover credit comes from Australia achieving a better result than it agreed to under the first Kyoto Protocol target, which allowed for an eight per cent increase in emissions between 1990 and 2010.
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