26 April 2010

Australia Shelves Emissions Trading Plan Until 2013

In what is the final act of a prolonged death spiral, the Rudd government has put off its proposed emissions trading scheme until at least 2013. From ABC News:

It was once a centrepiece of the Federal Government's election strategy, but now the emissions trading scheme (ETS) has been relegated to the shelf until at least 2013.

Delaying the scheme means the Government could save $2.5 billion from its budget over the next three years, because it would not be paying compensation to households and industries.

Prime Minister Kevin Rudd recently said climate change remained a fundamental economic, environmental and moral challenge, whether it was popular or not.

But Government sources say it was decided last week to remove the scheme from next month's budget, bowing to the political reality that the Senate is unlikely to pass the ETS any time soon.

The Upper House has already blocked the ETS legislation twice.

The bills are before the Parliament again but the Senate has delayed the debate while it examines the deal that Mr Rudd struck with former Opposition leader Malcolm Turnbull.

The bottom line is that neither the Opposition, now led by Tony Abbott, nor the Greens like the amended legislation, so it remains in limbo.

The targets set forth in the legislation could not have been met in any case, as I show in this paper (it has since been updated and is just about to be submitted), so perhaps the reprieve will enable a rethink. The Rudd government recently admitted that the bulk of the emissions reductions would have had to come from offsets. In any case a lot will happen between now and 2013, in Australian politics, but also with respect to other national climate policies and international negotiations.

I had an op-ed at ABC News on the ETS just last month in which I wrote:
Emissions reductions targets are offered up with little understanding of the implications for energy supply or the economy. Complex legislation is proposed that obscures the simple math of decarbonisation.

When push comes to shove no politician wants to impose economic discomfort on his or her constituents, so they look desperately for magical solutions. Emissions trading has provided that illusion up to now.

Australia, the United States and Japan, in particular are at a crossroads in climate policy. The decisions that they make at this juncture will shape climate policy around the world, leading up to the summit in Mexico at the end of the year and beyond.

Will they continue in pursuit of magical solutions? Or will they start fresh, with an approach grounded in the realities of the simple math of decarbonisation?

The success or failure of emissions reductions efforts depends on their answers.
Does Australia's step-back from the ETS represent a fresh start? Time will tell.


  1. What seems to have happened, post climategate is that the science came under scrutiny, then the economics. Let's hope we hear no more about decarbonisation for a long time.

    I have no doubt they will try again when the memory of climategate has diminished. There is too much money in it. Trillions of dollars.

    "Prime Minister Kevin Rudd recently said climate change remained a fundamental economic, environmental and moral challenge, whether it was popular or not."

    Muggers don't ask for your opinion.

    I said the financial crash was a criminal scam and so it has proved to be. The same forces are behind this.


    On Saturday, Goldman released a series of e-mails from Mr Tourre, in one of which he jokes that he has sold doomed investments to widows and orphans.


  2. You are quick off the mark on this one Roger. The ABC News and 7:30 Report reminded us tonight that PM Rudd had earlier described climate change as the "greatest moral challenge" and used the words "political cowardice" to describe those who suggested delay. It was widely anticipated that he would use the Senate blockage as a double dissolution trigger. This was followed by opinion poll results in answer to the question, "Do you support climate change action even if it involves significant costs" dropping from 68% to 48% over the past four years. Amazing how 20 percentage points changes perceptions of moral challenges and cowardice.

  3. "Does Australia's step-back from the ETS represent a fresh start? "

    More like it represents sanity.

  4. Disaster delayed is a good thing.
    Carbon trading and other CI2 obsessed policies are ideas from people who have been selling false fear about the climate for decades.
    I look forward to the rest of the bad climate solutions to fall away soon.
    Not one aspect of the extreme AGW position will stand up to rigorous scrutiny.

  5. The Great Leap Forward on mitigation thru national legislation or global agreement seems to have turned into a bit of rout of late.

    Everywhere you look you see action on climate change either being delayed, postponed or cancelled.

  6. Looks like Germany has abandoned action as well: http://www.spiegel.de/international/germany/0,1518,691194,00.html

  7. "Prime Minister Kevin Rudd recently said climate change remained a fundamental economic, environmental and moral challenge, whether it was popular or not."

    Actually this is has become a religious issue pure and simple. As we saw in the soviet union, Germany, China, Cambodia, and elsewhere the common man is far better off in this world when the politically powerful are focused on saving souls than when focused on making a perfect world.

  8. They should have set a limit of 2 degrees by 2100 because the way it looks now, that is achievable by business as usual.

  9. A stop isn't necessarily a fresh start, as the people who did the stopping have no fresh ideas. This is Rudd climbing out on a limb, and then refusing to saw it off behind him and crawling back to the trunk.

    A fresh start would require owning up to the truth, and this generation of global warming advocates can't do that. I suspect the Usual Suspects will have to be replaced before any straight talk is heard.