Carbon Pollution Reduction Scheme draft legislation released


Climate change

Air pollution

Credit: Uwe Hermann

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Draft legislation for Australia's Carbon Pollution Reduction Scheme was released yesterday afternoon by the Minister for Climate Change and Water, Senator Penny Wong.

Building on the Green Paper and White Paper released last year, the exposure draft legislation sets out what is required of participants in the Reduction Scheme - which essentially puts a price on greenhouse gas emissions, and is to be used as a tool to help reach the nation's emissions reduction target of between 5 and 15 per cent of 2000 levels by 2020.

"As one of the hottest and driest countries on Earth, Australia's environment and economy will be one of the hardest and fastest hit by climate change if we don't act now," Senator Wong said.

"Through...investment in energy efficiency, a four-fold expansion in renewable energy and the introduction of the Carbon Pollution Reduction Scheme, the Rudd Government is getting on with the job of tackling climate change."

Putting a price on carbon will encourage the development and implementation of new, low-pollution technologies, she said.

Under the Reduction Scheme, slated to begin mid-2010, entities with facilities that emit 25,000 tonnes or more of carbon dioxide equivalents annually will be required each financial year to report the emissions for which they are responsible - their 'emissions number'.

They will also have to acquire 'emissions units' (a form of carbon currency), and surrender one unit for every tonne of emissions they are responsible for. The draft legislation outlines a $40 cap per tonne for the first five years of the Scheme, which is set to rise five per cent per subsequent year.

There will also be a cap on the number of units able to be issued, and they will be distributed through auctions and given "as an assistance in relation to emissions-intensive, trade-exposed activities or coal-fired electricity generation."

The Government is currently seeking feedback from stakeholders on the terms of the draft legislation, and its effectiveness in delivering the White Paper's policy positions.

But members of the scientific community are already speaking out with concerns.

Barry Brook, the Sir Hubert Wilkins Chair of Climate Change at the University of Adelaide, said that one of the "most obvious" problems with the draft legislation is that "free permits are being handed to heavy polluters."

"Parliamentary debate should focus on redefining the percentage reduction in Australia's emissions by 2020 and in removing perverse subsidies to major greenhouse gas emitters," he added.

The legislation is also set to face a barrage of criticism when it faces the Senate, with the Coalition and the Greens both labelling the Scheme as flawed, and questioning its ability to reduce carbon emissions.

Even the Government's climate change advisor, Ross Garnaut, has come forward to express his disappointment with the Scheme, and a chorus of lobbying voices from many of the 'big polluter' companies are set to begin sounding out today.