Australia Postpones Emissions Trading Scheme Until 2013 or Later
Prime Minister Kevin Rudd has flip-flopped on one of the key promises of his 2007 election today, announcing that the government’s carbon pollution reduction scheme (”CPRS”) will be delayed until the expiry of the Kyoto Protocol at the end of 2012. The CPRS was due to start mid-next year, and the delay represents a significant and controversial retreat from what Prime Minister Rudd had once called “the great moral and economic challenge of our time” even previously threatening to dissolve parliament and call an election to resolve the issue. He yesterday blamed the decision on the opposition’s failure to support the measure and the slow progress of climate change developments at the global level.
The Senate (where the ruling Labor party does not have a majority) has already rejected the proposed CPRS twice last year - in August and December, just prior to the UN climate change meeting in Copenhagen. The announcement follows a report released last week by Melbourne think tank the Grattan Institute “Restructuring the Australian Economy to Emit Less Carbon,” which concluded that $22 billion in “free” permits, to be given to the dirtiest polluters under the proposed legislation over the next decade, are a waste of taxpayers money.
The opposition Liberal-led coalition supports the emissions reduction target and renewable energy targets, but opposes any emissions trading scheme or a carbon tax. It instead proposes a suite of measures such as carbon sequestration and forestry. The Greens, who also opposed the scheme, support a carbon levy to price carbon.
While Prime Minister Rudd today stressed that the federal government’s commitment to climate change reduction remains unchanged, it clearly has been removed from the agenda at least for the near-term. Similarly, the future of cap and trade in the U.S. seems doubtful: this week Senator Lindsey Graham (R-SC) withdrew his support for the major Senate climate bill he has been working on for months with Senators John Kerry (D-MA) and Joseph I. Lieberman (I-CT), which they were scheduled to announce on Monday morning.
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