Rudd’s Rut: Cap and Trade Getting Killed Down Under

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Will Australia’s cap-and-trade plan commence in July 2010, as Prime Minister Rudd promised? Not if the Liberals and the Greens have anything to say about it.

Last week, Climate Change Minister Penny Wong unveiled the draft laws of the emissions trading scheme (ETS), targeting carbon cuts of between 5 and 15 percent of 2000 levels by 2020. This week, the ETS is under increased fire from all directions.

The battle offers a window into the complexity of making climate laws in a coal-fired country.

Federal opposition leader Malcolm Turnbull is leading the charge on behalf of his center-right Liberal party, stepping up attacks on a scheme he once favored. He wants to delay ETS until at least 2012, and pile on extra industry hand outs. And he’s employing a familiar weapon to win over Australians, the threat of job loss.

It’s a particularly cynical ploy on Turnbull’s part in a drowning economy. Said Turnbull to Rudd this week:

"Why are you putting people out of work?"

There is no evidence that the ETS will "put people out of work," even in mining towns. But the story caught fire in the Australian media.

And now it’s clear that a majority of senators will vote against the ruling government’s ETS, complicating all prospects for legislation that has yet to be introduced into Parliament.

Rudd’s in trouble. His center-left Labor party doesn’t have a majority in the upper-house Senate. If the opposition blocks the bill, then he will need the support of Australia’s swing-vote Greens.

But the Greens now say they won’t endorse the ETS, unless it is substantially "greened up."

Specifically, they want the industry-friendly legislation to auction 100 percent of the emission permits — a vital aspect of any effective cap and trade scheme — rather than giving polluters a free ride, as the bill now does. They also want a strong reduction goal of 40 percent by 2020, not the current 5 percent target, or up to 15 percent in the event of a new global climate pact.

It’s been a bumpy road for Rudd on the climate issue. His first official act as prime minister was to sign the Kyoto Protocol, which he did with much fanfare at the Bali climate conference in December 2007. What a display of political courage:

"I can unite the world on climate."

He moved rapidly to force climate action in his nation, as SolveClimate reported one year ago. But it wasn’t long before his climate plans fell victim to lobbying, partisan politics and the usual suspects (i.e., big coal).

Coal generates some 80 percent of the country’s electricity. Australia is the world’s biggest coal exporter. And Rudd’s controversial plan became increasingly packed with polluter give-a-ways. Go figure.

This week, Climate Change Minister Wong warned opponents they’ll get "nothing" if they insist on changes to the ETS.

Nothing. Yep, that’s one possible outcome of Australia’s climate gridlock. Another is that Rudd makes the law even more friendly to polluters.

Keep in mind that the Labor party is much closer to Turnbull’s conservatives on the ETS. And Rudd may be willing to compromise away more of his party’s positions to secure passage of his centerpiece legislation.

Indeed, "grit teeth and compromise" is a "more likely" choice for Rudd than giving up on the bill altogether, Reuters writes today.

It is hard to see a notorious micro-manager, which Rudd is said to be by almost all who deal regularly with him, leaving any outcomes to chance, and he would be unlikely to simply shrug his shoulders and claim "I tried."

Any way you slice it, there will be a disappointing end to this cantankerous process, particularly when you think of the promise Rudd once had for global climate leadership, and may have since squandered.

Let’s just hope it’s not a preview of what’s to come in America, in the nation’s own congressional battle over global warming legislation.


See Also:

The Great Polluter Giveaway: Australia’s Cap-and-Trade Scheme

Eureka: Climate Lessons from Down Under

Memo to Obama: Make Carbon Cap Simple and Unsinkable

Cap on Emissions