Howard backs corporate polluter wish-list

Saturday, June 9, 2007

Under pressure to prove his government has answers to the global warming crisis, on June 3 PM John Howard backed the corporate polluter-friendly recommendations of his Task Group on Emissions Trading, set up on December 10.

Environmentalists criticised the task force for excluding climate scientists. Instead, the 12-member task force was comprised of six top executives from the biggest fossil-fuel producing or reliant corporations (such as BHP Billiton, Xstrata Coal and Alumina Ltd and the Energy Supply Association), as well as six top government bureaucrats.

Unsurprisingly, task force's recommendations read like a corporate polluters' wish-list, with the creation of a national emissions trading scheme by 2012 as the key mechanism for reducing Australia's greenhouse gas (GHG) emissions.

Emissions trading is favoured by big business as it gives the illusion that genuine action to reduce emissions is being taken while enabling continued reliance on the burning of fossil fuels.

Noting that corporate "Australia enjoys major competitive advantages through the possession of large reserves of fossil fuels", the report argues for overcoming a trend of "delayed" or "deferred" corporate investment into "emission-intensive industries" due to uncertainty about future government climate-change policies.

The report argues for substantially increased government funding for the development of unproven carbon capture and storage technologies (so-called clean coal). At the same time, in true Orwellian style, it recommends that the federal and state-based mandatory renewable energy targets be abolished — so as not to "pick winners". Federal targets demand that electricity producers use renewables such as hydro, wind, solar and geothermal sources to generate a paltry 2% of their electricity generation, while the Victorian government has set a target of 10% by 2016.

The Howard government has already granted $300 million to research "clean coal" technology through its $500 million Low Emission Technology Demonstration Fund. The ALP also proposes that if it wins office it will to set up a $500 million National Clean Coal Fund.

While the task force claimed that it wants the government to establish a "level playing field" between fossil fuels and renewables, it makes no mention of abolishing the massive government subsidies channelled to the fossil fuel-based energy and transport corporations, which totalled at least $9 billion in the 2005-06 financial year, according to a May 2007 report by the University of Technology Sydney's Institute for Sustainable Futures.

The ISF report concludes that because "less than 4% of the identified subsidies provide support for renewable energy and energy efficiency" (between $314-334 million in 2005-06), this "creates an uneven playing field for renewable energy".

Indeed, a genuine discussion about energy technology "level playing fields" would also take into consideration the massive government investment that was made in the past to build Australia's coal-fired power stations — many of which were then sold off cheaply in the 1990s to private investors. Shouldn't electricity production from renewable energy sources also receive massive public investment to enable "fair competition" to take place with coal-fired power stations?

With the big polluters pushing hard to be given free pollution permits, the report notes that "much of the cost from imposing a constraint on emissions will ultimately be borne by Australian households" that will face "higher prices for electricity" and petrol.

This is in line with the experience of the European Union's emissions trading scheme, under which the corporate polluters have made windfall profits by passing on the "costs" of pollution permits to ordinary consumers, despite the fact that these corporations were given the permits free of charge.

The June 2 Brisbane Times reported that if a CO2 emission "price was set at $30 a tonne, it would add $200 to an annual household power bill".

Although the task force's report recommends using some revenue raised through selling GHG emission permits to "assist households", such assistance would not be energy bill subsidies but would be in the form of employing bureaucrats to give poor people patronising advice on how to decrease their energy use, such as wearing a jumper in winter rather than turning on their electric heaters.

Backing up the report's conclusions that the new round of negotiations for phase two of the Kyoto Protocol are likely to be "slow" and "disappointing", Howard told a June 6 Asia Society fundraiser in Sydney that he will be aiming to use September's Asia Pacific Economic Cooperation summit to forge a new "flexible" international agreement based on voluntary pledges, rather than binding emission reduction targets.

While he is opposed to binding targets for international agreements, Howard has acknowledged the need for Australia to set a "longer term" emissions reduction target. While giving no indication of what that target might be, he has attacked Labor shadow environment minister Peter Garrett's personal view that there should be a target of reducing GHG emissions to 20% below 1990 levels by 2020 as threatening economic disaster — "a Garrett recession".

Of course setting interim targets between now and 2050 would be logical, and the 20% figure would fit in with Labor's stated goal of a 60% reduction by 2050. But instead of highlighting the fact that Labor is in favour of setting targets, Garrett has responded to Howard's attack by denying the need for the 20% by 2020 target — showing that the current leaders of both major parties are only interested in far-off "aspirational" targets that don't commit them to do anything today to combat climate change that would threaten the profit-driven reliance of corporate Australia on fossil fuel use.

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