Carbon abatement needs a bipartisan policy approach

CLIVE Palmer’s extravagant, duplicitous foray into the carbon tax debate highlights the gullibility of the Greens.

CLIVE Palmer’s extravagant, duplicitous foray into the carbon tax debate highlights the gullibility, naivety and inflexibility of the Greens and their dogmatic fellow travellers on the issue of what to do about climate change. In this case, the well-understood principle of “overshoot and collapse” refers not to former US vice-president Al Gore’s much-hyped environmental tipping points, but to the political overreach of the global-warming true believers. The Greens, who refused to sign up to Labor’s emissions trading scheme, and Labor, which imposed the world’s most expensive carbon price on the nation, have only themselves to blame if, as seems likely, Australia is left without a meaningful carbon abatement policy.

When the dust settles on the new Senate, the most likely outcome will be no carbon tax, no replacement “cap-and-trade” carbon scheme and no support for the Abbott government’s $2.5 billion “direct action” plan. The Renewable Energy Target will still be under review, with significant pressures to wind it back or scrap it. The Clean Energy Finance Corporation, if it survives, will most likely be told to redirect its $10bn investment pool away from windmills. There is no certainty Mr Palmer will maintain his support for the Climate Change Authority, which was enough to garner him the public praise of Mr Gore in what was one of the most audacious and carbon-intensive photo opportunities of all time. It is now abundantly clear that the opportunity cost of not pushing ahead with the soft-start cap-and-trade system linked to global action, first envisaged by Howard government adviser Peter Shergold in 2006, has been considerable.

Much of the blame can be shunted to Kevin Rudd who, following the 2007 election, raised the stakes dramatically by symbolically ratifying the Kyoto Protocol in Bali and declaring climate change “the greatest moral challenge of our time”. In doing so, he raised expectations to a point beyond satisfaction for an army of protagonists wanting to use climate-change politics as a proxy in the insoluble battle against fossil fuels and global capitalism. Mr Rudd could not get the necessary support for his Carbon Pollution Reduction Scheme because it was deemed to lack sufficient ambition.

As a result, the fruit of his dramatic escalation of rhetoric and expectations on climate-change action was firstly the scalp of then opposition leader Malcolm Turnbull, who had tried to negotiate in good faith. Subsequently, Mr Rudd lost his own head at the hands of Ms Gillard in a bloody coup that ultimately doomed Labor for years.

After scraping home in an election, Ms Gillard’s breach of faith in introducing a carbon tax — despite promising not to do so during the campaign — cursed her own prime ministership and led Labor to disarray. If nothing else, Labor’s self-harm exposed the truth of this newspaper’s claim that the Greens are a protest party unfit for government. For not supporting Mr Rudd’s CPRS, the Greens must wear ultimate responsibility for leaving Australia’s climate change response in tatters.

As Paul Kelly wrote on Saturday, once abolished, resurrection of an emissions trading scheme will be a long, hard, bitter road. This newspaper has been an unwavering supporter of a cap-and-trade system as the most efficient means to achieve substantial cuts in carbon emissions. Direct action, as envisaged by the Coalition, may provide incentives to innovate and secure co-benefits in the form of better land practices or electricity demand management tools. But, as the government admits, direct action is only a short-term solution while other nations get their carbon emission reduction houses in order.

If the world does make dramatic, co-ordinated cuts, the cost of direct action to match them will quickly become unsustainable compared to a cap-and-trade scheme. The key, however, is global action. If there was a reality check in Mr Palmer’s intervention in the dysfunctional debate last week, it was to re-state the case for linking Australia’s actions to its international partners. Despite the hype, the prospect of a meaningful global agreement at next year’s Paris summit is weak. Labor, the Greens and an army of climate-change lobbyists have clearly been willing to misrepresent the level of international action to suit.

As foreign editor Greg Sheridan has written, China is being widely lauded for a scheme that is little more than an idea. The central government of the world’s largest carbon-dioxide polluter is not able to commit to a cap on emissions while its economy is growing. China’s seven city or province-based carbon trading schemes give out almost all their permits for free. The European carbon market, the world’s largest, has been dogged by oversupply and claims of corruption, with the price crashing to €6 ($8.70). Japan has put its scheme on hold indefinitely and New Zealand has a carbon price of $4.60 ($4.27) a tonne, with most emitters paying only for every second tonne.

Despite the good headlines, Barack Obama has been unable to move on carbon trading in the US. He has resorted to a plan to restrict emissions from electricity generation, mostly by switching to unconventional gas and new-generation nuclear. Green groups point to US state-based carbon-trading schemes. But even in California, political reality is biting. Last week, 16 Democrat assembly members, a third of their caucus, signed a letter urging California Air Resources Board chairwoman Mary Nichols to delay or redesign the state’s cap-and-trade program. They were “concerned about the impact of the program on constituents”. Against these realities, our economy-wide, $26-a-tonne carbon tax is out of step with the rest of the world. Six years of overshoot on carbon pricing has left Australia’s body politic fatigued. Great political capital and energy have been spent, but the nation has arrived right back where it started. The lesson is carbon abatement policy requires bipartisan support. The minor parties cannot be trusted.