Nonsensical emissions trading scheme unveiled

Good ol' Rudd tokenism again: Large political compromises ensure that it will have negligible effect on carbon emissions. All it will do is generate another nice little bureaucracy to administer it

Motorists are guaranteed petrol price relief for just three years under an emissions trading scheme unlikely to have any short term effect on greenhouse gas emissions. The Rudd Government has opted for a softly, softly approach which will likely lead to an increase in the cost of living of less than one per cent. Its options paper on emissions, released in Canberra today, will see Australia ease into a relatively gentle scheme on July 1, 2010. This approach is good news for industry and means there will be a limited impact on household budgets - but it's not likely to lead to deep cuts to greenhouse emissions in the short-term.

The key points:

Scheme will probably add less than 1 per cent to the cost of living.

Petrol will be included, but there will be no net price increase because the fuel excise will be cut.

Pensioners, carers and seniors will have their payments increased to make up for price rises.

Other low-income earners will get tax breaks and increased allowances to make up for price rises.

Middle-income earners will get some financial assistance.

Scheme to start on July 1, 2010.

Free "permits to pollute" will be given to big polluters who export their goods; 90 per cent of their emissions will be for free.

Twenty per cent of the scheme's permits will be given out for free.

Coal-fired power stations will get cash payments to compensate for increased costs, and develop clean coal technology.

Petrol will be included in emissions trading, but the fuel excise will be cut so that there is no net increase in price. The decision to cut the petrol excise so that emissions trading does not push up prices - which was first proposed by the federal opposition - flies in the face of advice from the government's hand-picked climate change adviser Ross Garnaut. He urged against an excise cut last week, saying the price of petrol should rise to send a signal to the market to use less. The government says it will review the excise cut after three years. Fuel taxes on heavy vehicle road users will also be cut.

As expected, electricity is included in the scheme, as is throwing out rubbish to landfill, while agriculture is out until at least 2015. The options paper forecasts the cost of living will rise by 0.9 per cent due to emissions trading, meaning the average price for a basket of goods will rise by 0.9 per cent in the first year of the scheme.

Low-income earners will be given cash payments to make up for those price rises. Pensioners, carers and seniors will have their payments increased, and other low-income earners will get tax breaks and increased payments from the government. The scheme also aims to placate middle-income earners, who will get financial assistance.

Emissions trading seeks to tackle climate change by putting a price on carbon emissions. Big emitters have to buy "permits to pollute", which they can trade between them, so the market sets the price. The government has taken on board industry's concerns about the scheme, responding with a relatively generous support package. Big emitters who export much of their product - such as aluminium smelters - will be all-but exempted from emissions trading at the start. They will be given free "permits to pollute" to cover 90 per cent of their emissions. In all, 20 per cent of the scheme's permits will be given out for free, rising to 30 per cent once agriculture is included.

Coal-fired power plants will be compensated with direct payments from the government, including to develop clean coal technology. And there's a win for the forestry industry - companies who plant trees can qualify for carbon credits, but companies who chop down forests don't have to pay.

Climate Change Minister Penny Wong made reference to the gentleness of the scheme, saying it was not possible for Australia to lead the world on climate change. "After so many years of inaction, it is impossible for Australia to be in front of the world in tackling climate change," Senator Wong said today as the options paper was unveiled. "A greater risk is being left behind a world of emerging economic opportunities."

She stressed the importance of protecting the economy and the national interest. "In this green paper, the government has sought to strike the right balance, on the basis of economically responsible policy in the national interest." The government will release its final plan for emissions trading, along with draft laws to start the scheme, in December this year. The options paper does not include hard facts on the cost of emissions trading, but gives a big hint, basing key calculations on a carbon price of $20 a tonne.

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Sea of the young and devout swamps dormant Sydney dockland

(See Zeg's cartoon and commentary on the Leftist protests against the Pope here)



For five days it will stand as the biggest religious festival Australia has seen: 4000 priests, 418 bishops, 26 cardinals and more than 150,000 pilgrims celebrating mass together on the Sydney harbour foreshore. Catholics from around the world yesterday transformed a long-dormant section of Sydney's docks into a sea of waving national flags, cheering, singing and crying young pilgrims. They gathered to hear the leader of the Catholic Church in Australia, Cardinal George Pell, celebrate mass as the sun set on a magnificent winter's day.

Although record-breaking, their number will be dwarfed by the expected 500,000-strong congregation who will attend the papal mass on Sunday at Randwick racecourse, in Sydney's east.

Kevin Rudd welcomed the pilgrims in several languages, and with a broad Australian "G'day". "Too often in the history of the world, when young people travel in great number to other parts of the world, they do so in the cause of war, but you here today are here as pilgrims of peace," the Prime Minister said.

The Barangaroo site was full an hour before Cardinal Pell and a crowd of bishops took to the stage at 4.30pm and police were forced to turn thousands away. Following the greetings, and the welcoming ceremony by indigenous singers and dancers, a hush came over the crowd. Cardinal Pell welcomed the pilgrims to Sydney, speaking in French, German, Spanish, Italian and English before his homily. He said young Catholics should struggle against their "fat, relentless egos" and commit themselves to their fate. "Following Christ is not cost-free, not always easy, because it requires struggling against what St Paul called 'the flesh' - old, fat relentless egos,old-fashioned selfishness," he said. "It is always a battle, even for old people like me."

The mass combined the old and the new - a new musical setting, the Our Father said in Latin, a choir of 300 and an orchestra of 80 young people.

Rachel Karuana, 20, from Kenya, described the mass as one of the most emotional experiences of her life. She said the pilgrimage to Australia took her four days, four plane trips and many more bus rides. But being here among other young Catholics had made the journey worthwhile. "This is so big, I don't have words," she said. "Faith is something you need to make work and this is what I'm doing being here."

Standing nearby, with white ochre drying on his skin, Derek Lynch, 21, waited nervously to go on stage. The indigenous dancer from the Kurruru Youth Performing Arts Group in Adelaide said it was a once-in-a-lifetime event. "It's huge - something the entire world's going to be focusing on," Lynch said.

Eight pilgrims addressed the crowd, speaking of their experiences at previous World Youth Days, telling the crowd of their life-changing moments and encouraging their fellow pilgrims to be proud of their faith and to speak up for what they believe in. Katrina Alvir, a teacher from Sydney, told pilgrims that it wasn't always easy to be open about her Catholic faith. She said being a Catholic in Australia sometimes meant "keeping your mouth shut and keeping your love of God inside yourself".

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Eco-protest is powered by hypocrisy

Comment on a recent Greenpeace stunt at Swanbank power station

GREEN is the new black. If you're not totally environmentally cuddly by now, you may as well check your re-usable grocery bags at the door. You know the ones we're talking about: those thick plastic bags that allegedly replace the thin plastic bags, which is why every second bugger at the checkout queue has a box of plastic bin-liners secreted in the trolley among the dunny paper, cat food and instant noodles.

The sky is, after all, falling. We're running out of oil. But how did the Greenpeace "go solar" protesters get out to Swanbank? Did all 15 catch the train (which in Queensland runs on electricity generated by burning coal from places like Swanbank)? Maybe they drove in a car-share arrangement, consuming numerous litres of highly processed fossil fuel in the process. Or maybe the proverbial pushbikes the three Sydney protesters rode up on were taken for a canter.

If that were the case, then what a shame that those bikes are probably made of metal extracted from Australian iron-ore mines, plastics sourced from Bass Strait oil, and manufactured using coal-fired electrical power.

Another question for the go solar protesters: How many photo-voltaic cells (produced, by the way, in factories using coal-fired power and petrochemicals) do you have on the roofs of your homes? Or is that all a bit expensive?

Maybe that's a bit unfair. But given your passion to go solar perhaps you wouldn't even have electricity hooked up, just in case some fossil fuels might have suffered in the course of its production. After all, candles are perfectly good illumination in the lounge room while you sit on the treadle to power the dynamo that powers the television (produced with yet more dirty power and petrochemicals) so you can watch yourselves on the 6pm news.

And where do these galahs who were scaling the chimneys last week think the steel and hi-tech apparatus for their climbing equipment came from? It didn't grow on avocado trees. And, of course, being true believers in the cause, none of them would use computers (that requires electrical power and the bastards are made with nasty stuff like plastic) or mobile phones, would they? Mobile phones (more petrochemicals and metals and requiring transmission towers) are the devil's own tool.

Don't fear climate change, don't fear pollution, just retain a healthy cynicism when it comes to the crusaders. Hypocrisy and self-righteousness are the enemy.

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Synfuel is the solution Australia needs now

Synthetic fuel from coal and natural gas is already well-established and widely used in South Africa. Why not in Australia? Australia has huge amounts of coal and natural gas

The most critical problem we now confront is not global warming or how to tax emissions, but providing enough affordable fuel to avoid severe recession before alternative energy can become reality. The Lucky Country faces a choice between disaster and a unique opportunity.

Oil supply

Over the past two years climate all over the world has inexplicably begun a pronounced cooling. This is contrary to all expectations from global warming theory and growing other evidence is also indicating that the threat has been overestimated. However, the obsession with catastrophic climate change seems to have distracted attention from a much more certain and immanent danger. The oil supply vital to the entire economy is not keeping up with increasing demand while presently all focus is on renewable energy solutions that will require decades to develop and implement.

Consider just a few key facts about oil:

production is already in decline in some 50 nations; new discoveries have steadily declined for several decades and are far below depletion rates; oil exports are decreasing in most exporting nations as their own domestic demand increases; refining capacity has not kept pace with demand due to environmental restrictions and investment concerns over future supplies of crude; most existing refineries are designed for light sweet crude the supply of which is rapidly declining; future oil will increasingly be heavy sour crude which only a minority of existing refineries can use; the major producers have no reason for massive investment to increase production. The value of their remaining reserves is rapidly appreciating. Increased production would reduce prices and accelerate depletion. Expensive infrastructure for increased production would soon end up excessive to declining reserves.

Growth in demand, shortages and further price rises will slow the global economy for the foreseeable future. Fuel intensive sectors such as primary production, transport and travel will be hit especially hard.

Synfuel

Viable alternative energy is still decades away. Using commercially proven technology synthetic fuel from coal and gas could supply all our needs here in Australia at much less than the current price of fuel from oil. Only emission restrictions on CO2 stand in the way. "Clean" renewable technology is decades from becoming commercial.

The Australian economy is in a vulnerable position. Manufacturing is in decline and, at 13 per cent of GDP, is among the lowest in the developed world. The trade balance remains in chronic deficit even with the mineral boom. In April it became positive for the first time in six years but in May it was in deficit again, chiefly because of rising oil prices. Foreign debt is growing at twice the rate of the economy. It is now about 60 per cent of GDP, the highest in the developed world.

High commodity prices normally last only a few years before increased production, spurred by high prices, brings them down again. An end to the boom will result in a fall in the exchange rate of the Australian dollar, an even worse trade deficit and a crippling increase in the cost of foreign debt. An economy not dependent on imported oil would be a huge advantage.

Australia's portion of global CO2 emissions is about 1.4 per cent or just six months' growth in China's emissions. Natural uptakes of CO2 over Australia's land and Exclusive Economic Area of surrounding ocean absorb much more than this. Our net contribution to global CO2 emissions is already negative. Whatever we do or don't do will be trivial to the global situation, either in quantity or even as an example. Why cripple the economy for an increasingly doubtful theory?

The opportunity

Global warming is a distant and uncertain possibility of a problem that most likely does not even exist, at least in the catastrophic form being predicted. It can only be meaningfully addressed by developments that will require decades to become effective and which, in any event, must be undertaken even without the threat of warming.

Severe economic hardship because of fuel costs and shortages, however, is an imminent probability. This could be greatly alleviated if not avoided altogether by development of our own liquid-fuel supplies. It would be far easier to do this now in a time of prosperity than trying to do it in a recession. Having such capacity already in place might well even avert a recession here altogether. Being energy independent would be a huge competitive advantage in a time of high energy costs and shortages everywhere else.

Although precaution in the face of uncertainty is sensible, the realm of hypothetical risk is limitless. Many perceived risks turn out to have no reality. Remember the Y2K millennium bug scare? We cannot build fortresses against every shadow of doubt. Precaution too is not without its own attendant risk. Any proposed precautionary measure must be weighed against alternatives as well as consideration of its own consequences.

Obsessing over distant uncertain risks, while ignoring immediate consequences, is poor precaution. For Australia, drastic cuts in carbon emissions to prevent global-warming is to climate what anorexia is to obesity.

The proposed carbon taxes will achieve only a vast new windfall for government, large cost/price increases and economic recession with little or no actual reduction in emissions beyond what is effected by economic decline. Emission trading is set to become a huge new non-productive industry of wealth redistribution with a negative net outcome.

The world is headed for an energy crisis with consequences we have not even begun to appreciate. Australia is better positioned to cope than any other nation. For us synfuel is eminently practical and regardless of the ultimate reality of climate change will have negligible effect on the global outcome. The only thing holding us back is blind adherence to an ill-founded belief that daily becomes more hysterical, in denial of conflicting evidence, contrary to sound science and detached from climate itself.

The choice is unambiguous. We can either adhere to the dogma of the eco-cult and suffer immense self-inflicted hardship or take a clear path to future prosperity. Seldom is the way forward so obvious. One way takes a detour through Jonestown the other goes down Easy Street. The political leaders who recognise this and present it to the electorate will be the next government.

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