CANBERRA – Australia’s parliament has rejected a plan for the world’s most ambitious emissions trade regime, bringing the nation closer to a snap election and prolonging financial uncertainty for major emitters.
Conservative parliamentarians holding the largest block of votes in the senate joined with Greens and independents to defeat the carbon pollution reduction scheme (CPRS) set to start in July 2011 which was aimed at reducing emissions in the biggest per-capita emitter in the developed world.
But the government renewed its pledge to push through the scheme before a December UN meeting in Copenhagen.
“This Bill may be going down today, but this is not the end,” climate change minister Penny Wong told the senate. “We will bring this Bill back before the end of the year because if we don’t this nation goes to Copenhagen with no means to deliver our targets.”
Greens wanted tougher emissions targets, while conservative opponents are divided on the need for a scheme and want it delayed until after Copenhagen, fearing Australia will be disadvantaged if other nations fail to act.
In a sign some major industrial emitters are fearful of months more uncertainty over the scheme’s $10 billion estimated cost, the second-largest power retailer warned of a possible energy supply crisis.
“The ongoing uncertainty surrounding the [carbon-reduction] legislation is delaying both the investment necessary to meet Australia’s long-term baseload electricity needs and the investment in lower-carbon technology required to gradually reduce Australia’s emissions,” Origin Energy said.
Surveys show prime minister Kevin Rudd well ahead in opinion polls and that most Australians favour action to combat climate warming. Elections are due in late 2010.
Mr Rudd has promised emissions cuts of 5-25 per cent on year 2000 levels by 2020, with the higher end dependent on a global agreement to replace the UN’s Kyoto protocol. But if the Senate blocks the legislation a second time, after three months it will hand Mr Rudd a trigger for an early poll set to focus on climate change.
Mr Rudd told parliament the defeat of his emissions trading plan had “put Australia’s future on climate change in grave jeopardy”. Scientists say Australia, the world’s driest continent, faces a rapid rate of climate warming. – (Reuters)