Change has eco­nomic di­men­sion

The Weekend Australian - Review - - Clean Energy - Nigel Wil­son

CLEAN en­ergy is vi­tally im­por­tant to Aus­tralia in the chang­ing po­lit­i­cal world sur­round­ing cli­mate change. With 85 per cent of the na­tion’s elec­tric­ity gen­er­a­tion ca­pac­ity fu­elled by coal and with gen­er­a­tion be­ing the largest sin­gle con­trib­u­tor to green­house gas emis­sions, pol­icy de­ci­sions on how to han­dle change will have dra­matic im­pact.

That’s why the fed­eral Gov­ern­ment’s com­mit­ment to hav­ing an emis­sions trad­ing scheme up and run­ning by 2012 will af­fect ev­ery­one.

Not only will en­ergy prices rise for in­dus­trial, com­mer­cial and res­i­den­tial con­sumers, the choices we make about fu­ture en­ergy sup­plies will be vastly dif­fer­ent from the ones that shaped our ex­ist­ing econ­omy.

For some time it has been ev­i­dent that busi­ness gen­er­ally was run­ning ahead of politi­cians and bu­reau­crats on cli­mate change.

For in­stance, AGL En­ergy in March was the first Aus­tralian com­pany to sign up to an emis­sions trad­ing scheme, join­ing the Chicago Cli­mate Ex­change.

The Dar­win Dec­la­ra­tion of en­ergy min­is­ters from the Asia Pa­cific Eco­nomic Co- op­er­a­tion fo­rum in late May paid lit­tle re­gard to cli­mate change, re­flect­ing the the vast dif­fer­ences be­tween the 21 economies rep­re­sented. Along­side APEC is an en­ergy busi­ness ad­vi­sory group of sub­stan­tial Aus­tralian com­pa­nies in­ter­ested in en­ergy which held a gas fo­rum be­fore the APEC meet­ing.

It rec­om­mended APEC coun­tries should in­sti­tute an im­me­di­ate re­view of na­tional en­ergy and green­house gas re­duc­tion poli­cies ‘‘ with em­pha­sis on es­tab­lish­ment of an eq­ui­table and co- oper­a­tive mech­a­nism to place a value on car­bon emis­sions across the re­gion.’’

The gas fo­rum re­port urged the en­ergy min­is­ters to rec­om­mend to the Septem­ber sum­mit in Syd­ney they com­mit to a new re­solve on ef­fec­tive re­gional ac­tion and re­form of in­sti­tu­tional ar­range­ments to ad­dress the dual chal­lenge of en­ergy se­cu­rity and cli­mate change.

Gas Fo­rum co- or­di­na­tor, Bob Pritchard, said Prime Min­is­ter John Howard was ‘‘ spot on’’ in char­ac­ter­is­ing cli­mate change as an is­sue with ma­jor eco­nomic im­pli­ca­tions. He had also cor­rectly recog­nised that a price must be set for car­bon emis­sions. Pritchard says the Dar­win Dec­la­ra­tion had en­cour­aged en­ergy min­is­ters to ad­dress the APEC Gas fo­rum rec­om­men­da­tions. ‘‘ They might never de­cide on a re­gional emis­sions trad­ing scheme but, so far as I am con­cerned, their dec­la­ra­tion is a sig­nif­i­cant in­di­ca­tor of the pos­si­ble fu­ture di­rec­tion of en­vi­ron­men­tal poli­cies.’’

APEC is an im­por­tant re­gional fo­rum that Aus­tralia will need to have back­ing emis­sions trad­ing be­cause uni­lat­eral poli­cies will not work, de­spite the view of the Ge­orge W Bush Ad­min­is­tra­tion in the US that it is up to in­di­vid­ual coun­tries to work out the cli­mate change strate­gies which best suit them.

Howard’s task group on emis­sions trad­ing has urged a de­gree of cau­tion — a propo­si­tion that is en­dorsed by in­dus­try.

‘‘ Aus­tralia should not pay higher en­ergy costs than nec­es­sary to achieve emis­sions re­duc­tions, in other words, gov­ern­ments need to let the mar­ket sort out the most ef­fi­cient means of low­er­ing emis­sions with all low emis­sions tech­nolo­gies on the ta­ble and that of ne­ces­sity must in­clude nu­clear power,’’ Howard said in his re­cent an­nounce­ment.

Howard has promised a world- class emis­sions trad­ing sys­tem, more com­pre­hen­sive, more rig­or­ously grounded in eco­nomics and with bet­ter gov­er­nance than any­thing in Europe, which is just as well be­cause the Euro­pean scheme in­tro­duced two years ago is widely re­garded as a fail­ure.

But there is no doubt Howard is right when he says im­ple­ment­ing an emis­sions trad­ing scheme and set­ting a long- term goal for re­duc­ing emis­sions will be the most mo­men­tous eco­nomic de­ci­sions Aus­tralia will take in the next decade.

Newspapers in English

Newspapers from Australia

© PressReader. All rights reserved.