Bloomberg reports that the US lower house has passed  a cap and trade legislation. The article is short on detail but, in any event, must go to the upper house. The aim is to have a 17% cut in 2005 emissions by 2020

House Passes Climate-Change Plan, an Obama Priority (Update2)

By Lorraine Woellert and Simon Lomax

June 26 (Bloomberg) — The U.S. House passed legislation to limit greenhouse-gas emissions that scientists blame for global warming, a top priority of President Barack Obama intended to create jobs and make the U.S. energy economy more efficient.

The House voted 219-212 for the measure, which would create a cap-and-trade plan of pollution permits to curb emissions. The measure goes to the Senate.

“Global warming is real and it’s moving very rapidly,” House Energy and Commerce Committee Chairman Henry Waxman of California said during debate. “Let us not lose this historical opportunity for our national security, for jobs in our country, to make us the leader once again in the international community.” He called the measure “an enormous jobs bill.”

The American Clean Energy and Security Act calls for the U.S. to reduce its greenhouse-gas emissions by 17 percent from 2005 levels by 2020.

Obama called the House vote a “historic action” and told reporters he is confident the Senate also will act on the climate issue. The legislation “ushers in a critical transition to a clean energy economy without untenable burdens on the American people,” the president said.

Obama had joined Democratic congressional leaders in lobbying for votes earlier today as the outcome was in doubt. Forty-four Democrats voted against the measure, while eight Republicans were in favor.

Republicans and business groups, including the U.S. Chamber of Commerce and the American Farm Bureau, sought to drum up opposition to the 1,200-page legislation they called a national energy tax that would eliminate jobs, not create them.

‘Job-Killing Bill’

“This is the biggest job-killing bill that has ever been on the floor of the House of Representatives,” said Republican leader John Boehner of Ohio, who spoke against the bill for about an hour. He said the U.S. should increase drilling of oil and gas while working to create alternative sources of energy.

Republican Frank Lucas of Oklahoma called the measure “the single largest economic threat to our farmers and ranchers in decades,” saying it would increase their energy costs. “I will not make my constituents poorer so others can get richer at their expense,” he said.

Democrats turned back a Republican amendment from Representative Randy Forbes of Virginia that would have substituted a research summit on clean energy for the Democrats’ plan.

House Agriculture Committee Chairman Collin Peterson, who negotiated revisions that brought many rural lawmakers on board, said he was voting for the measure although it still has “problems” he considers “unworkable.”

‘Too Complex’

“It is too complex, the way they’ve structured this and the deals they’ve cut,” said Peterson, a Minnesota Democrat.

Democrats say the bill would create 1.7 million new jobs, save 240 million barrels of oil by 2020, and require in most cases that states get 20 percent of their electricity from renewable sources such as wind and the sun by then. The Congressional Budget Office estimated the measure would cost an average of $175 a year per household.

The measure would boost investment in new energy sources by financing research and providing $10 billion to develop technology to capture emissions from burning coal. Utilities would get free greenhouse-gas pollution permits to aid investment in renewable energy sources. A $30 billion revolving loan fund would support small and mid-sized clean-energy manufacturing efforts.

Aid to Polluters

The bill’s chief sponsors, Waxman and Democrat Edward Markey of Massachusetts, agreed to reduce its environmental mandates and increase aid to polluters, including coal-fired power plants, to help companies meet the measure’s clean-air regulations. That wasn’t enough, though, to guarantee the support of all Democrats from rural districts.

Jim Owens, chief executive officer of Peoria, Illinois- based Caterpillar Inc., opposed the measure in a letter to House Speaker Nancy Pelosi of California that said, “We advocate coordinated international action rather than unilateral U.S. action on climate and energy.”

In pushing for the bill, environmental groups generated about 200,000 calls to about 90 congressional offices this week and are making about 400 more today, Sierra Club spokesman Josh Dorner said.

Former Vice President Al Gore, who won a Nobel prize for his work on climate change, was calling lawmakers from his Nashville home on behalf of the bill. AFL-CIO chief lobbyist Bill Samuel said the union group supported the plan, even as he called it “not perfect.”

Energy Scientists

Even so, a coalition of energy scientists, in a letter to lawmakers, called the measure’s investment in renewable energy “inadequate.”

Joining the American Farm Bureau, the nation’s largest farm lobby, in opposition was a coalition of food processing groups including the National Chicken Council and the National Meat Association.

One critic, billionaire investor Warren Buffett, head of Omaha, Nebraska-based Berkshire Hathaway Inc., has called the plan “regressive.”

U.S. Chamber of Commerce Executive Vice President Bruce Josten urged lawmakers to vote against it because he said it wouldn’t ensure development of enough renewable energy sources to make up for the required reduction in fossil-fuel emissions.

To contact the reporter on this story: Lorraine Woellert at lwoellert@bloomberg.net; Simon Lomax in Washington at slomax@bloomberg.net

Last Updated: June 26, 2009 20:13 EDT

After being a scpetic for some time now regarding Australia’s ability to generate 25% of its energy from renewable, I am more confident today that we have the ability tot generate a much higher percentage by 2020. The article in the Herald suggests there is a groundswell moving in thast very direction.   Whilst wind energy is not the answer, developments in solar (heating and pv), tidal and geothermal will prove to be able to generate base load power.  Clean Coal or carbon storage is not the way to go and, as the article suggests, gas will fill the gap, in particular coal seam methane.  

Paddy Manning

SMH 13 Jun 2009 

The Australian Government employs about 237,000 public servants. Not one of them is planning for the country to make a complete transition to renewable energy or even seriously envisaging such a scenario.

A spokesman for the Prime Minister confirmed this week a clean energy future is not on our agenda, even as an option - not for 2020, not for 2050, not at all, even though thousands of people will march around Australia today demanding just that.

As a result most of us are completely in the dark as to whether there is potentially enough renewable energy to go around and at what cost. We are held hostage to the argument that coal and nuclear are the only credible options for “baseload power”.

It would be prudent at least to work up a plausible transition-to-clean-energy scenario, because a tipping point is looming and the public’s patience will not last forever.

As soon as 2013, we face the total loss of Arctic summer sea ice. A blue North Pole will be more than a psychological shock - cue media frenzy, photos from space, political promises, sceptical blathering etc.

The summer Arctic ice covers 7 million square kilometres (about the size of Australia) and reflects 90 per cent of the sun’s energy back into space. If or when it melts altogether, 80 per cent of that warming energy will be absorbed by the ocean. It’s called the “albedo flip” - a sudden loss of reflectivity - and it’s one of the planet’s many feedback mechanisms, which threaten to accelerate climate change dramatically.

Privately funded groups in Australia, worried and fed up waiting for credible action from the Government, can see the need and are developing back-up plans, on a shoestring but with conviction and purpose.

Zero Carbon Australia (ZCA) 2020 is one such document, being drafted by volunteers, mainly in Melbourne (see beyondzero emissions.org), with funding from the Climate Emergency Network. An initial exercise estimated Victoria - reliant on dirty brown coal - could halve its emissions within three years at a cost of $29 billion.

Then about six months ago the group won seed funding of $25,000 from a private donor in NSW to prepare a national plan.

About 50 scientists and engineers, activists and writers are working on the plan, using their own internal wiki. The aim is to show how renewable sources could provide Australia’s entire energy demands by 2020.

The guiding principles behind ZCA 2020 include that all technological solutions must be proven, reliable, commercially available and costed at today’s prices. Energy security must be enhanced. The transition must not cause other environmental degradation (for example, land clearing for biofuel crops).

Separate “zero carbon” plans will cover stationary (ie, non-transport-related) energy, transport, land use, buildings, industrial processes and replacing coal export revenue.

A rough draft of the stationary energy plan - eliminating roughly half the country’s emissions - will be made available to interested parties next week.

Over the next decade, the draft plan envisages: using energy efficiency to keep demand at current levels; electrifying transport; creating a smart grid; switching coal-fired power stations to gas in the transition; and obtaining half of our electricity supply from 50 solar thermal power stations and another third from more than 11,000 wind turbines. A ballpark estimate of the costs is $250 billion over the decade.

The group is working on a public launch of the finished stationary energy, buildings and transport plans in mid-August.

The campaign director, former computer engineer Matthew Wright, has a weekly radio show on climate science and solutions on Melbourne’s 3CR community radio station. “We’ve got tens of thousands of climate action group members all over country,” he says. “All kinds of people, there’s the whole spectrum there.”

One of the first localised groups in Australia, Climate Change Balmain-Rozelle, for example, has 170 supporters and its own website, blogging to 700 households. Those concerned about climate change are constantly told, as Malcolm Turnbull told the ABC in 2007: “You cannot run a modern economy on wind farms and solar panels. It’s a pity that you can’t but you can’t.” Wright disagrees: “That’s absolute rubbish.” ZCA 2020 will give people confidence they can lobby for a clean energy supply.

Among similar planning exercises overseas is the Desertec Foundation, backed by the Club of Rome. (Yes, that’s the same Club of Rome that in 1972 - forget decades of troglodyte scoffing - correctly predicted we would be facing environmental crisis by the mid-21st century.)

Desertec aims to provide clean power from deserts. In Europe, that means building massive concentrating solar power stations in the Sahara, with power sent thousands of kilometres north through high-voltage direct-current cables.

In terms of deserts, Australia looms large. We have, according to Stewart Taggart of Desertec’s local arm (he also runs Desertec in the US and China from beachside Manly), an unbelievable opportunity to become a clean energy superpower by 2050. The plan to do so has been drawn up and is available online.

Taggart, a former financial journalist and economist, is a director of consultancy Acquasol, which is working on the world’s first large-scale solar-gas hybrid desalination plant, at Port Augusta.

A positive for Australia is that our ageing 1970s-era coal-fired power plants require replacement in coming years, while the country’s electricity grid also needs an overhaul. “The whole system is like a clapped-out Cuban Chevy on its final kilometres,” Taggart says. “This replacement cycle represents a blessing in disguise. It’s really fortuitous.”

Taggart wants to see Australia make a “dash for gas” between 2010 and 2020 in the transition to renewable energy.

Australia’s solar, geothermal, wind and wave energy endowments are sufficient to create “a massive clean energy export industry that could one day power Asia”.

The desert bit is important because concentrating solar power requires direct normal radiation and minimal atmospheric moisture or cloud cover, which trends to diffuse the light.

Australia has a world-class solar resource, perfectly flat and geologically stable. We also have selective expertise in transmission technology in this area: the 177-kilometre Murraylink (the world’s longest buried HVDC power line) and the Tasmania-Victoria Basslink cable (until recently the world’s longest subsea HVDC cable).

“It’s all shaping up as a beautifully ‘perfect storm’,” Taggart says. “Coal goes out one door, solar and geothermal come in another and HVDC power lines tie it all together. Australia’s definitely the lucky country.”

Press reports including the AAP article in SMH today suggests that the Oppostion let by Malcolm Turnbull will try and force a double dissolution on the issue of the ETS. By having both houses of parliament (House of Reps and Senate) sit at the same time, Rudd is hoping to pass the legislation ahead of Copenhagen. Turnbull’s view is that the vote should wait till February 2010 when Australian Parliament reconvenes after the summer recess. This he says would give us the chance to see what USA and others have agreed to. It has been a long sore point with Liberal Party that they do not agree to Australia committing to carbon reduction targets alone believing that cuts by Australia in isolation of a global agreement would be meangless in its global impact while disadvantaging Australia with respect to its trading partners.

Turnbull eyes January vote on trade scheme

May 31, 2009 - 12:12PM

Australia could have an emissions trading scheme legislated early next year, after Opposition Leader Malcolm Turnbull indicated his readiness to see parliament recalled for a vote in early January.

“I’ve got no doubt we will have an emissions trading scheme in Australia,” Mr Turnbull told ABC Television today, ending days of doubt about the coalition’s commitment to an ETS.

Mr Turnbull said the coalition would be prepared to have parliament sit “straight after” global climate change talks.

The opposition last week announced it would vote to defer legislation setting up the Rudd government’s planned scheme until next year, after a decision on emissions trading by the US Congress and UN talks in Copenhagen.

The coalition is also seeking a Productivity Commission inquiry into emissions trading.

Mr Turnbull says parliament could be recalled in early January - a month ahead of schedule - to vote on an ETS.

“We could come back straight after (Copenhagen),” he said, adding the parliament would be fully informed about US plans and a likely global agreement.

The opposition last week announced it would not vote for an Emissions Trading Scheme (ETS) until next year, throwing out the government’s timetable.

The government had hoped that business would put pressure on the opposition to back down and allow the scheme to pass this year.

Parliamentary secretary for climate change Greg Combet last week warned that business could lose out on assistance if the scheme had to be rewritten next year.

But the Australian Industry Group’s chief executive Heather Ridout on Sunday said the scheme needed more work, offering some support to the federal opposition’s push for a delay.

“You’ve got to get the tradeoff right between certainty and certain death for many industries by getting the thing wrong,” she told Network Ten.

“We need to work much harder on the trade-exposed industry assistance issues. To the opposition’s credit, that’s a core issue that they’re concerned about.”

“The most important thing is that we get a scheme that works.”

Ms Ridout said she had been having fruitful discussions with the opposition.

The government has argued that the laws must be passed this year to create certainty for investment, but Ms Ridout said the economic crisis was the real obstacle to investment.

“The issue that’s really been focusing people’s minds is the fact that the global financial crisis is really restricting the capacity of business to make the investments.”

Mr Turnbull also rejected the government’s arguments its ETS legislation needs to pass parliament in June to provide business with certainty, saying the government’s plans contained “a dirty little secret.”

“The guts of this scheme, the essential details of the scheme, are actually in the regulations, which are rules made by governments administratively, not legislated by parliament.”

Those regulations had not yet been published, and would determine how much compensation industry would receive under the scheme.

“They are not being presented to the parliament.”

Asked whether The Nationals would toe the line on an ETS, Mr Turnbull said the community would expect Australia “to follow suit as part of an effective global agreement” if the US established emissions trading.

AAP

An article in the Australian reports that Carbon Emissions must start falling by 2015 to keep temperature rise to 2 deg C.

WORLD carbon emissions must start to decline in only six years if humanity is to stand a chance of preventing dangerous global warming, a group of 20 Nobel prize-winning scientists, economists and writers has declared.

The United Nations climate summit in Copenhagen in December must agree to halve greenhouse-gas emissions by 2050 to stop temperatures from increasing by more than 2C, the St James’s Palace Nobel Laureate Symposium concluded.While even a 2C temperature rise will have adverse consequences, a bigger increase would create “unmanageable climate risks”, according to the St James’s Palace memorandum, signed by 20 Nobel laureates in physics, chemistry, economics, peace and literature.The temperature target “can only be achieved with a peak of global emissions of all greenhouse gases by 2015″, the document said. If emissions continue to rise after that date, the required cuts would become unachievable.

Everybody knows white reflects heat. So why not change the colours of rooves, buildings, paths to be white. A scientist is serious about this as the TIMES reprint in the Australian reports:

 May 28, 2009

Article from:  The Australian

LONDON: As a weapon against global warming, it sounds too low-tech. But the idea of using millions of buckets of whitewash to avert climate catastrophe has won the backing of one of the world’s most influential scientists.

Steven Chu, the Nobel prize-winning physicist appointed by President Barack Obama as US Energy Secretary, wants to paint the world white.

A global initiative to change the colour of roofs, roads and footpaths so that they reflect more of the sun’s light and heat could play a big part in containing global warming, he said yesterday. Speaking at the opening of the St James’s Palace Nobel Laureate Symposium in London, Professor Chu said this approach could have a vast impact.

By lightening paved surfaces and roofs to the colour of cement, it would be possible to cut carbon emissions by as much as taking all the world’s cars off the roads for 11 years, he said.

Building regulations should insist that all flat roofs were painted white, and visible tilted roofs could be painted with “cool-coloured” paints that looked normal but absorbed much less heat than conventional dark surfaces.

Pale surfaces reflect up to 80per cent of the sunlight that falls on them, compared with about 20 per cent for dark ones, which is why roofs and walls in hot countries are often whitewashed. An increase in pale surfaces would help to contain climate change both by reflecting more solar radiation into space and by reducing the amount of energy needed to keep buildings cool by air-conditioning.

Professor Chu said his thinking had been influenced by Art Rosenfeld, a member of the California Energy Commission, who drove through tough building rules in the state. Since 2005, California has required all flat roofs on commercial buildings to be white.

Last year, Dr Rosenfeld and two colleagues from the Lawrence Berkeley National Laboratory in California, Hashem Akbari and Surabi Menon, calculated that changing surface colours in 100 of the world’s largest cities could save the equivalent of 44 billion tonnes of carbon dioxide - about as much as global carbon emissions are expected to rise over the next decade.

The Times

An article in the Australian today reports on the Climate Institute and their reserach claiming that 26.000 jobs will be created from jobs already in the pipeline for renewable energy. Clearly, renewable energy targets will exist side by side with any carbon reduction scheme. This is the key drive of electricity generation at the moment and the increase in renewable energy targets will result in increased investment in wind farms and geothermal plants, the two technologies seen to be at the forefront of clean technology. Perhaps wave energy will get a fillip but it is clear that a number of industries are getting boosts from renewable energy investment. The same impact might be extrapolated from an Carbon Pollution Reduction scheme, countering or balancing claims that industries like mining will lose jobs if ETS is introduced.

Lenore Taylor, National correspondent | May 25, 2009

Article from:  The Australian

RENEWABLE energy projects under construction or planned in response to the proposed emissions trading scheme will create 26,000 jobs, according to new research published as the federal Coalition seeks to defer the scheme on the basis that it could be a “jobs killer”.

Research commissioned by The Climate Institute shows $31 billion worth of clean energy projects already in the pipeline, many in regional areas, will generate 2500 permanent jobs, 15,000 construction jobs and 8600 associated positions. The research does not include jobs in domestic solar or insulation, or new projects funded through the $1.6 billion solar flagships program announced in the budget, and is based on surveying investors rather than making projections from modelling.

It comes after modelling commissioned by the Minerals Council of Australia found that even the most modest emissions-reduction target planned by the Rudd Government would leave the mining sector with 24,000 fewer jobs over the next decade than it could have expected without a price on carbon.

The competing jobs predictions come as the federal Coalition prepares to push for a delay in parliamentary consideration of the emissions trading scheme until after the UN conference in Copenhagen in December, on the basis of its potential impact on employment.

But, as reported in The Weekend Australian, it is likely that one option to be put to shadow cabinet and the Coalition partyroom this week will be to offer to negotiate a bipartisan position with the Government on the emission reduction targets the Government should consider as part of any new international agreement, while delaying the emissions trading legislation. The Greens and senators Nick Xenophon and Steve Fielding have not dismissed the possibility of a delay.

The Coalition has said it could support emissions-reduction targets at least as strong as the 5 to 25 per cent of 2000 levels advocated by the Government by regulating on energy efficiency measures and storing carbon in vegetation and soils, alongside an emissions trading scheme.

Opposition emissions trading spokesman Andrew Robb told the Victorian Liberal Party state council yesterday that the Government’s scheme was “in no shape to be passed and the vote must be deferred until after Copenhagen”, when Australia could assess the promises made by trading competitors.

The Business Council of Australia and other business groups have backed the Government’s argument that the legislation needs to be passed now in the interests of investment certainty.

Treasury modelling for the Government found the emissions trading scheme would have only a small net effect on total employment in the long term, but heavy industry has warned of the upheaval that could be caused as the economy adjusts to the new cost on carbon.

The research released by The Climate Institute, commissioned from energy sector consultants McLennan Magasanik Associates (MMA), found the states to benefit most from clean energy project proposals were NSW (4921 jobs) South Australia (4586) and Victoria (4346).

The planned projects - including geothermal, wind, solar, biomass and wave power - would predominantly benefit regional areas. By far the biggest investments are planned for wind power projects, followed by geothermal.

“This research shows that if climate change and renewable energy legislation passes through parliament without being weakened, it will help drive the industrial shift that can put Australia at the front of a global energy boom which already employs more people worldwide than those directly employed in oil and gas,” Climate Institute chief executive John Connor said.

Mr Robb said the Government should delay its legislation until it had assessed the short-term impacts on employment in different sectors of the economy.

“If passed in its current form, the biggest structural change in our history would be more a product of blind faith and pig-headedness than rigorous analysis,” he said.

A NAB report obtaibned by the AGE claims an ETS could generate around $6 billion per year of investment. The article claims that the reporting of impacts on the investment side has been negelected in the debate about the costs to the country of introducing an ETS.

THE Rudd Government’s emissions trading scheme could trigger an investment surge worth more than $6 billion a year, according to secret economic modelling revealed as Parliament gears up to determine the fate of controversial climate change laws.

An internal report by the National Australia Bank obtained by The Sunday Age suggests the emissions trading debate has focused on short-term costs and ignored new investment opportunities.

“The average year-on-year investment created by the (Carbon Pollution Reduction Scheme) could be up to 60 per cent greater than that committed for infrastructure in this year’s budget,” the report says.

It says there has been “little consideration of the investment stimulus” that would be created as the economy becomes less greenhouse intensive.

The report comes as a national poll conducted on behalf of the Climate Institute has found more than three out of four Australians believe the Liberal Party should support the Government’s emissions trading scheme legislation.

The sharply divided Coalition will go the party room within the next week to consider the legislation before the House of Representatives debates it next week. The legislation will go to the Senate next month.

The Coalition, which is considering a bipartisan position on targets for the world climate conference in Copenhagen in December, wants the legislation delayed until after that conference.

But an Auspoll survey of 1120 people has found 77 per cent believe the Liberals should back the legislation now. Only 23 per cent think they should oppose it.

The online poll taken from May 15 to 19 found women were more likely than men to say the Liberals should support it (83-71 per cent), and younger people more likely than those older (82 per cent of 18-29 year olds compared with 71 per cent of those 50 and over).

Greens sources said yesterday that while they were opposed to the legislation they were “not inclined” to vote for delay. So the Opposition would probably need the votes of Family First senator Steve Fielding and independent Nick Xenophon if it wanted to defer the legislation until after the December conference.

But Senator Xenophon told The Sunday Age yesterday: “My strong inclination is that we need to deal with this legislation, in terms of the architecture and design of the scheme, before Copenhagen.”

Certainly the NAB report will give the Government added traction to argue for the legislation to be passed. The modelling work traces the impact of the three possible emissions reduction targets announced by Government. It assumes that the price of emissions will rise from $20 a tonne of carbon dioxide to $100 a tonne as the Government cuts the number of permits. It also assumes that 30 per cent of Australia’s investment efforts to cut emissions will leak to foreign countries.

Under the least onerous scenario — a cut of 5 per cent below 2000 levels by 2020 — investment would soar by $5.8 billion a year by 2020 and by $10.8 billion by 2050, or an average of $6.2 billion a year.

A 25 per cent cut will become Government policy if there is a strong agreement at Copenhagen.

 An article in SMH this weekend keeps up the pressure on CCS. It reports that money might be better spent on solar technology where the cost per MW is lower and the technology is proven. More importantly, backing CCS as a “winner” would seem to be a high risk strategy. The carbon cost required is $80 per tonne so maybe other technologies are a more cost effective route.

Carbon capture schemes an expensive step into the unknown

Paddy Manning

May 16, 2009

As tipped here a month ago, the Federal Government will spend $2 billion to build “industrial-scale” carbon capture and storage projects in Australia.

You would be better off just burying the money, from an environmental point of view, because many doubt the CCS technology will work. The best proponents can say is, it has to. But if it doesn’t, the money is worse than wasted, because the spending will have exacerbated the climate problem by justifying construction of new coal-fired power stations that burn for another 30 to 40 years.

The public could bear the ultimate liability if the technology fails, too, because the Offshore Petroleum and Greenhouse Gas Storage Act - the world’s most comprehensive, according to the Government, when it was passed last November - nicely shifts long-term liability (beyond 15 years) onto the Commonwealth.

There’s loopholes anyway. For example, if a greenhouse gas storage licence holder has “ceased to exist” after a site closure certificate is issued by the resources minister then liability reverts to the Commonwealth.

We’ve seen what lengths James Hardie went to, to avoid its long-tail asbestos liabilities.

Insurance companies would not take on CCS risk at any price, as even the Government recognises. “Obtaining insurance [for CCS] is nigh on impossible because these are pilot schemes,” a spokesman for the Resources and Energy Minister, Martin Ferguson, told the Herald.

Private investment in CCS to date has been minuscule, which is why there is no commercial-scale facility in operation today.

The Australian Coal Association told the Herald that just $25 million had been spent by the end of last year from its Coal21 Fund - the industry’s main vehicle for funding CCS projects - although its members had made legally binding commitments to spend another $496 million. All up the fund expects to invest more than $1 billion over the next decade. The ACA says coalminers are not the prime polluters - it’s the coal-fired power stations - and they should not have to front the expense of CCS.

Ferguson’s office says coal companies had no incentive to invest in CCS under the Howard government. “The reason the coal industry is now starting to make significant contributions toward CCS …is because they now see the Federal Government is going to put a price on CO2 emissions, meaning they now have an economic incentive to invest in reducing emissions,” the spokesman said. Industry reaction to the budget commitment to CCS this week was that it was a mere “down payment” on the investment required - as Dick Wells, the chairman of the Commonwealth-appointed National Low Emissions Coal Council, told one newspaper - or “a bit like peeing in the ocean”, according to Keith Orchison, a columnist and former oil and gas industry lobbyist.

Tony Maher, national president of the Construction, Forestry, Mining and Energy Union, welcomed the government’s CCS spending this week. Two years ago, though, he told a public meeting in Newcastle that - unlike renewables where there was a clear need for Government funding for pilot projects - the coal mining industry was “a very wealthy global private sector industry and it does not need one dollar of public support”.

Maher also admitted scepticism about CCS would “only be overcome once it’s developed … but there’s no reason to oppose the use of the private sector’s money to deploy those technologies. If it doesn’t work, you’ve only wasted Rio Tinto and BHP’s money, and I don’t see that there’s any need to cry about that. If it does work, it’s a tremendous achievement.”

Maher told G-BIZ this week there was no model for private funding for large-scale CCS projects and a hybrid model including public spending was needed.

So having prospered for decades under generous state-based royalty regimes, and having furtively lobbied against effective climate change policy, and having failed to manage the risk that climate change was actually occurring, and having demanded (and won) extensive concessions under the draft emissions trading scheme now that action is urgent, the coal lobby has the hide to demand the public fund the very CCS technology they have been unprepared to back themselves for the last 15 years. And the money needed? Whatever it takes. It’s a bottomless pit.

What do we get for our initial outlay? The Government expects its investment of $2 billion - generating a total investment of $6 billion after 2-for-1 matched funding from industry and state governments - will fund construction of between two and four new CCS-fitted coal-fired power stations generating between 250MW and 450MW each.

By comparison, the $1.2 billion investment in four flagship solar energy stations will generate 1000MW for about $3.6 billion after matched funds are invested, according to the Government’s announcement.

Simply put, CCS is hideously expensive. At Moomba - the biggest known onshore reservoir - it is technically feasible, I am told, and commercially attractive if the carbon price is about $80 a tonne. Well, we’re starting at $10 - so don’t hold your breath. That’s why, speaking on the budget on Lateline Business this week, Industry Fund Services’ chairman and Infrastructure Australia director, Garry Weaven, welcomed the Government’s clean energy expenditure but added he personally had “some question marks over carbon capture and storage as a technology bet”.

WorleyParsons is big in CCS and solar. Last year Worley proposed Australia’s largest solar power project to date, the Advanced Solar Thermal initiative. Backed by Rio Tinto, BHP Billiton, Woodside and others, the project would generate 250MW, for about $1 billion.

That project could qualify for funding under the Government’s solar flagship program, but it would be Worley’s clients that needed to apply. Peter Meurs, managing director of Worley’s sustainable business unit, told the Herald: “The fact is the world hasn’t done enough CCS yet to be very definitive on prices. We need to build more complete projects to get more definitive numbers. My feeling is the Government is doing the right thing, in helping the first large-scale CCS and solar projects get going in Australia.”

My feeling? The solar spending better count, because we’ll never see that CCS money again.

The much expected delay to the ETS has been decided upon by the Rudd Government. It will be interesting to see what the reaction will be from Malcolm Turnbull, leader of the Opposition. Greens will probably be quite disappointed.

Article from:  The Australian by Christian Kerr and Lenore Taylor (4 May 2009)

THE Rudd Government has delayed the start date of its proposed emissions trading scheme by a year to win Senate support for its Carbon Pollution Reduction Scheme.

The measure is just one of a series a compromise measures announced by the Prime Minister in an attempt to win the support of the Greens for its climate blueprint.

The package includes a very low fixed price on carbon for the first year of the scheme’s operation and extra assistance for each of the two categories of so-called trade exposed industries for the duration of the recession.

It also includes the concession that the government will consider a tougher emissions reduction target of 25 per cent of 2000 levels by 2020, in the unlikely event of a global agreement designed to limit the concentration of greenhouse gases in the atmosphere at 450 parts per million. Otherwise the government’s previously announced target range of 5 to 15 per cent would apply.

The amendments, signed off by the Cabinet subcommittee on climate change this morning, and later announced by Prime Minister Kevin Rudd at a press conference in Canberra, are designed to win support from Malcolm Turnbull’s opposition in the Senate and appease mounting industry concern about the costs of the scheme during the global recession.

The Australian Greens yesterday wrote to Mr Rudd with their “bottom line” for Senate support for the scheme, which is that the government’s “unconditional” emissions reduction cut should be 25 per cent, rather than 5 per cent, and that the government should consider cuts as high as 40 per cent in the event of a tough international deal at the Copenhagen talks in December.

The government will still need the support of independent Nick Xenophon and Family First’s Steve Fielding to steer the CPRS through the Senate.

The Prime Minister said the changes have been made because of three sets of factors.

“The first is obviously, changes in the global economy and the impact of the global economic recession and the recession which now impacts on our shores as well,” he said.

Mr Rudd also cited the need to provide “maximum impetus for a strong outcome” at the Copenhagen Conference on Climate Change later this year and the need to provide “business certainty and investment certainty.”

Mr Rudd says today’s announcement “represents an appropriate response to the current uncertainty”

But it will also push the start date of the emissions trading scheme beyond the next election.

The revamped CPRS legislation will establish a one-year fixed price period. Carbon permits will cost $10 per tonne of carbon in 2011-12, with the transition to full market trading from 1 July 2012.

A new Global Recession Buffer will be provided as part of the assistance package for emissions intensive trade exposed industries. Industries eligible for 60 per cent assistance will receive a 10 per cent buffer, while industries eligible for 90 per cent assistance will receive a 5 per cent buffer.

Eligible businesses will also receive funding to undertake energy efficiency measures from 1 July 2009.

The government will also establish an Australian Carbon Trust to allow households to invest directly in reducing Australia’s emissions and to drive energy efficiency in buildings.

Mr Rudd says the Government has embraced the views of the Australian community in developing its new package.

“We have listened to calls from the business community for a later, more gradual start to the Carbon Pollution Reduction Scheme and additional assistance to help manage the impacts of the global recession,” he says.

“We have listened to Australian households who have raised concerns that their individual efforts to reduce emissions had not been adequately taken into account under the CPRS.
“Together this package of measures strengthens our response to climate change, ensuring Australia plays its part in global efforts to tackle climate change while managing any impacts on our economy.”

The Prime Minister says the government will also continue to work with interested groups to deal with other technical matters to do with emissions trading as they arise.

Legislation for the CPRS will be introduced when parliament resumes later this month.

Great footwork, wrong dance

• May 5, 2009
• SMH Editorial

IN OTHER circumstances, on other issues, Kevin Rudd’s backdown on the carbon pollution reduction scheme would be a neat manoeuvre. It offers one sop to environmentalist critics, particularly the Greens, by increasing the possible cut to emissions which will eventually be enforced. It offers several others to those in business whose anxieties about introducing the scheme in a world recession had been mirrored in Coalition criticisms. The concessions are intended to make the legislation’s passage through the Senate easier. Despite its political cleverness, though, it is an unfortunate move.

Yesterday’s announcement was a retreat for Mr Rudd, who had previously insisted that the carbon trading scheme would start in July next year. “To delay any longer … is reckless and irresponsible” as he said in December. It still is - but Mr Rudd has reasons apart from the financial crisis he adduced yesterday for wanting a delay. The next federal election is due within months of the scheme’s start which, with its unpredictable effects, might well have complicated the Government’s prospects. As it is, the Prime Minister’s buckle puts pressure on Malcolm Turnbull to agree to the scheme, because it grants some of his demands and makes his stance more respectable than it deserves to be. Business has more time to prepare for the scheme’s introduction, and will know clearly what is in prospect because the enabling legislation should be passed this year. And big polluters, particularly those in export-oriented industries, will be granted more generous concessions in the form of free permits, and will enjoy them for longer. The Government has rounded up several business lobby groups to back its changes. On the other side, the Greens have lowered their demands to a 25 per cent cut in emissions by 2020, down from 40 per cent. The Government has agreed because that will harden its position and draw the sting from environmentalist criticisms.

Will the Opposition fall into line? Unfortunately, it seems not. Yesterday Mr Turnbull was gloating about his opponent’s backdown but, as one who has executed backdowns of his own on this issue, he should think carefully before he cements himself and his party in on what he knows is the wrong side of history.

As an exercise in practical politics, the backdown is clever; as a move to counter climate change it is not. Reports of melting ice caps, vanishing glaciers and the rest remind us daily there is no time to waste. Both Mr Rudd and Mr Turnbull know Australia should be acting now. Only politics is holding it back.

It appears the Opposition will not block passage of the legislation of ETS through the Senate provided that some changes are made by the Government. 

Article from:  The Australian

Christian Kerr

April 30, 2009

THE Coalition today ruled out supporting the emissions trading scheme in its current form, calling for the Government to analyse the “flawed” plan’s effect on jobs and to consider alternatives.

But the Opposition’s emissions trading spokesman Andrew Robb left the door open to allowing the ETS to pass through the Senate.

“No one is saying it’s all or nothing,” Mr Robb said, releasing a Coalition-commissioned analysis of the Government’s Carbon Pollution Reduction Scheme.

“What we are saying go right back and do the work, fix up the flaws, do not put in jeopardy tens of thousands of Australian jobs, especially at a time when we’ve got the biggest financial crisis in 80 years,” he said.

The analysis, prepared by David Pearce from the Centre for International Economics, warns that the Government has failed to adequately assess the level of environmental benefits the CPRS will achieve for its cost, its ability to deal with uncertainty and whether it explicitly accounts for international developments.

Parliamentary Secretary for Climate Change Greg Combet effectively conceded yesterday that the Government will have to deal with the Coalition to pass the CPRS.

He said the Greens had “made themselves irrelevant” with demands that amounted to “lunacy”.

Mr Robb said the CIE report “clearly establishes that the design of the Government’s proposed emissions trading scheme needs to be reconsidered and compared empirically with alternatives.

“For the Government to have ignored the impact of the global financial crisis beggars belief,” he said.

“The costs over the next 20 years of lost competitiveness and lost jobs must be established, along with the likely impact, or not, on CO2 emissions.”

Mr Robb accused the Government of “flying blind” on both the risk to jobs and emissions reductions.

“The Rudd Government has no idea of how many jobs its scheme will destroy, how it affects different industries or regions, or even whether it is the most cost-effective option for Australia to reduce CO2 emissions.

“Constructive alternatives to the Government’s flawed scheme are necessary. As well as reviewing the carbon pricing mechanism, energy efficiencies in the commercial building sector, carbon capture in soil and other means, and the efforts of individuals, must be part of an effective scheme.”

Mr Robb said the Government’s CPRS will destroy jobs.

“What the Pearce report confirms is that the Government has done no analysis, no analysis of what will be the transitional affects on businesses of their scheme,” he said.

“The only work out there at the moment about what will happen to jobs is the work that has been commissioned by all of these companies who are very fearful about the circumstance and their future and about future investment and the viability of their businesses.”

The report recommends that the Government ask the Productivity Commission to carry out this research.

The Opposition seems no closer to a policy position on emissions trading despite the release of the report.

“The Coalition will finalise its policy response once we’ve seen the results of the current Senate inquiries and following analysis of this report,” Mr Robb said.

Opposition Leader Malcolm Turnbull’s office was unable to say if he would be commenting publicly on the Pearce report today.

Coalition sources have suggested that Mr Turnbull will face major challenges in finding a policy path Liberals and Nationals will follow.

Divisions over emissions trading and climate change policy dealt the final blow to the leadership of his predecessor, Brendan Nelson.