Labor’s carbon pricing is at best only part of the answer, and science tells us the Liberals’ soil sequestration policy just doesn’t cut it. [9 July 2013| Peter Boyer]
The battle is joined. Julia Gillard’s generous parting gift to Kevin Rudd to leave the stage clear for him has settled the principal combatants for the coming federal election. All we need now is a date.
Oh, and some policies. Personality and charisma aren’t the only determinants of elections. Policies still count, and on that basis there’s much yet to be revealed before we can make a sensible choice at the election. Both Kevin Rudd and Tony Abbott have a lot of explaining to do.
Until Rudd’s return Labor’s election policies were built around the big continuing projects from Gillard’s term of office — the national broadband network, school funding reform, the disability insurance scheme and the carbon pricing scheme. But with Rudd’s return it’s a new ball game.
The carbon price is one of the big conundrums. In his first prime ministership Rudd almost got an emissions cap-and-trade scheme over the line before falling at the last hurdle, when Tony Abbott, on the pledge to vote the scheme down, wrested Liberal leadership from Malcolm Turnbull.
Rudd’s decision to postpone the scheme cost him his job. Julia Gillard’s post-election response, pushed by the Green and independents, was to legislate for a two-stage scheme: a fixed price, or a tax on polluters, which after three years would be transformed into a cap-and-trade system.
Australia’s carbon price is just a year old, and despite Abbott’s claim that it would “put a wrecking ball through the economy”, there’s no sign it had any economic impact at all. That raises the question, is it having any impact where it’s supposed to — cutting carbon emissions?
Australia’s emissions went down by 7 per cent in the year to June 30. Evidence suggests that the carbon price was a factor, but there were others of at least equal importance. These include a decelerating economy, lower power usage in response to high prices, and a boom in rooftop solar.
Longer-term investment is where a carbon price is likely to have its most important and lasting impact by strangling capital inflow to emissions-intensive generation. A key indicator suggests that this is actually happening: there are at present no proposals for new coal plants in Australia.
Rudd’s suggestion that the carbon price might be exposed to market forces a year earlier than the scheduled 2015, which would see the price drop from $24.15 to around $6 a tonne next July, got an angry response from the Greens and would put a big hole in Labor’s budget.
But it will blunt Tony Abbott’s “big new tax” argument. Having failed to stop Gillard’s scheme, Abbott has pledged that on taking office he will take “immediate and concrete steps” to repeal it.
Abbott includes in his pledge the future cap-and-trade scheme that is built into the Clean Energy Future package. He says that ahead of the election he will write to the head of the prime minister’s department to make it clear that repeal of the whole package is the Coalition’s top priority.
Even with a strongly favourable election result it remains unlikely that Abbott will win control of the Senate. If a hostile Senate were to reject his repealing legislation, he says he’ll seek a double-dissolution election, an option last taken 26 years ago under Labor leader Bob Hawke.
All of which would be anathema to long-term investment. On top of the uncertainty about the fate of the carbon price would be all the unknowns contained in the Coalition’s sparse and untested climate policies.
Our Plan—Real Solutions for all Australians, the Coalition’s 52-page general policy document released in January, devotes just 100 words in four sentences to its plans for emissions reduction.
Abbott’s alternative “direct action” approach includes the funding of proposals from business for cutting carbon on the basis of lowest cost. The Coalition claims it will be “verified abatement”, but to keep policing costs down it will depend heavily on proponents’ goodwill and honesty.
It sounds too good to be true, and it is. It brings to mind the problems that overtook Labor’s home insulation scheme. With substantial sums of money on offer and minimal supervision, what’s to stop a company rolling into its abatement proposal items it would have had to buy anyway?
Under coal industry pressure Abbott also plans to “review” (read “weaken”) the renewable energy target of 20 per cent by 2020, which has been a rare climate policy success both under Labor and John Howard’s Liberals. It makes no sense to do anything but strengthen it.
The biggest question around Coalition policy is the sequestering of carbon in farm soil. This will certainly improve our capacity to grow food, but it’s claimed it can deliver a significant proportion of the emission cuts needed to reach the 2020 target of 5 per cent below 2000 levels.
But a study by 34 of the world’s leading carbon-cycle scientists, including CSIRO specialists Pep Canadell and Mike Raupach, shows that such a scheme could contribute only a tiny proportion of the scale of abatement needed for the 2020 target. The analysis, prepared last year for the journal Earth System Science Data, found that by 2011 over 91 per cent of total global emissions were coming from fossil fuel use and cement manufacture, and about 95 per cent of this came from fossil fuels.
The capacity for targeted land programs to enable soils and plants to take up this extra carbon is very limited — on a tiny scale compared to what is needed to deal with past fossil-fuel emissions, let alone current and future fossil carbon.
Liberal environment spokesman Greg Hunt suggested that criticism of the plan was political, and said data available to the Liberals supported their proposal. But he’s offered no source for this.
The Coalition’s reticence suggests it either doesn’t know the answers or doesn’t care. Or both.