[Top News] from [REUTERS]
[Green Business]
Australia carbon laws in doubt, election possible
Tue Dec 1, 2009 1:49am EST
By James Grubel
CANBERRA (Reuters) - The Australian government's plans to cut carbon emissions were headed for defeat in a hostile Senate after the elevation of a new opposition leader opposed to carbon trade laws, setting a trigger for an early 2010 election.
Prime Minister Kevin Rudd, who met President Barack Obama on Monday in Washington, wants to take a lead role at next week's Copenhagen climate change summit by enacting a "cap-and-trade" scheme requiring polluters to buy permits for their emissions.
However, new Liberal opposition leader Tony Abbott said after his party-room election on Tuesday conservative senators, many of them climate change skeptics, would reject Rudd's emissions trading laws if they were not deferred until early 2010.
Abbott said he believed in climate change but told reporters he was opposed to the government's emissions trading scheme (ETS) model, the biggest economic policy change in modern Australian history, and was not afraid to fight an election on the issue.
"This is going to be a tough fight. But it will be a fight. You cannot win an election without a fight," said Abbott, a boxer in his university days who once studied for the priesthood.
Assistant Climate Change Minister Greg Combet said the government would still push for its carbon trade laws to be passed this week, and said he hoped some opposition lawmakers would side with the government and defy Abbott.
"The extremists have gained control of the Liberal Party. They are opposed to taking action on climate change, they dispute the science," Combet told reporters.
Rudd has struggled to have his climate change bill passed in the upper house Senate before parliament adjourns until February.
He wants emissions trading to start in Australia in July 2011, covering 75 percent of emissions in the developed world's bigger per capita emitter. The planned carbon trade scheme would be the biggest outside Europe.
The United States is watching Australia's debate closely. A political agreement on carbon trading in Australia would help garner support for action from other countries.
If the Senate ends up rejecting the carbon scheme for a second time, Rudd will have a trigger to call an early 2010 election on climate change, most likely for March or April. Polls suggest his government would win an increased majority.
If Rudd wins a so-called double dissolution election of both houses of parliament, he could then push his climate policy through a special joint sitting of the lower and upper houses.
BUSINESS, ELECTION UNCERTAINTY
Rudd has repeatedly said he does not want an early poll and would prefer elections to be held on time in late 2010.
Whatever the timing, the election would not be fought solely on climate change. Traditional issues such as the economy, unemployment and home loan interest rates would also dominate.
A decision by Australia's central bank to increase official interest rates on Tuesday, and for banks in turn to hike mortgage rates, gave Abbott the chance to pounce on economic management.
"The Australian people need to understand that each and every interest rate rise over the next 12 months is due to the irresponsible spending spree of the Rudd government," he said.
Abbott said while the opposition rejected the ETS, it still backed the government's emissions reduction target of at least 5 percent from 2000 levels by 2020, with a 25 percent target if nations agree on an ambitious climate pact in Copenhagen.
The prolonged debate on the ETS has caused some dismay among companies, coal and power firms in particular, who see some sort of scheme as inevitable and are looking for pricing certainty.
Banks and fund managers see the ETS as a boon for traders, investors and new green technologies, while major polluters generally oppose it as a tax on heavy industry.
International Power Australia, a unit of International Power and Australia's largest private-sector generator, says the uncertainty has impinged on talks with its lenders.
Major miners such as BHP Billiton and oil and gas firms such as Woodside Petroleum have criticized the scheme, although have been mollified somewhat by government pledges last month to raise state compensation.
"Australian industry is now thrown into total uncertainty regarding a price on carbon and therefore cannot make any informed investment decisions," said Tim Hanlin, managing director of Australian Climate Exchange Ltd.
"This is going to put Kevin Rudd under enormous pressure to call an election on this issue," he said.
Monash University analyst Nick Economou disagreed. He said Rudd would now miss his Copenhagen deadline and be in no rush for an election, putting the chances of an early poll at 20 percent.
"They may as well play the long game, the patient game," Economou said, adding Rudd would prefer a normal election later in 2010 to give him time to build an attack against Abbott's Liberals with the carbon laws waiting to be passed.
(Editing by Michael Perry and Paul Tait)
(For a graphic on the Copenhagen climate talks, click on:
here)
[Green Business]
FACTBOX: Sticking points for forest CO2 scheme at Copenhagen
Tue Dec 1, 2009 2:49am EST
(Reuters) - A U.N.-backed scheme that aims to reward developing nations for saving or rehabilitating their forests has made major progress during climate negotiations over the past two years and is likely to advance further at talks in Copenhagen.
But several issues still need to be resolved and will be discussed when negotiators from around the world meet in the Danish capital from next week to try to reach agreement on the outlines of a tougher global climate pact.
Here are some of the sticking points facing the scheme called reducing emissions from deforestation and degradation (REDD).
FINANCE
Rich countries, the United Nations and institutions such as the World Bank are putting up money to develop REDD. The problem is who manages the cash and governs how it will be used.
There are fundamental differences between developed and developing countries over whether the World Bank and other big lending agencies should disburse funds, or whether the United Nations should handle the money.
Developing countries have criticized the World Bank for being dominated by the United States and inflexible in its lending.
The United States and Australia tend to favor bilateral funding, to ensure a flow of forest carbon offsets to their future domestic emissions trading schemes.
SAFEGUARDS
One of the thorniest issues. It is widely agreed that for REDD to work, indigenous people or local communities need to be consulted and play a key role in fighting deforestation.
The problem is how to enshrine their rights into legal language all nations can accept. The current REDD draft negotiating text refers to the U.N.'s Declaration on the Rights of Indigenous Peoples, but these references are still in square brackets and therefore still up for negotiation.
Tricky, too, is how to ensure the full engagement of indigenous groups, plus maintaining an area's biodiversity and including all these into an internationally accepted regime that measures, reports and verifies steps to curb deforestation.
Protecting natural forests from being turned into plantations is another problem. The current draft text has two options, namely that any REDD scheme should not provide incentives for the conversion of natural forests and safeguarding the conversion of natural forests. Greens, such as WWF, prefer the first option.
The final choice of words is still to be made. Another problem is that the U.N. hasn't fully nailed down what the definition of "natural forests" is.
SCOPE
Lots more debate likely here. Should REDD just focus on curbing deforestation and build a reward structure on that basis, which is what Brazil wants?
Or should it be "REDD+," which would also recognize efforts to enhance carbon stocks, conservation of forests and sustainable management of forests?
India and others would like this option since they say they have stopped most deforestation and instead want to be rewarded for efforts to protect and expand what's left.
Brazil also objects to REDD becoming a purely market-based scheme with money flowing from the sale of carbon offsets, fearing rich nations would buy the credits and so avoid cutting emissions at home.
Others, such as Indonesia, back a market-based scheme and are working closely with Australia to bring this about.
(Sources: Greenpeace, WWF, The Nature Conservancy, The Prince's Rainforest Project and the Report of the Informal Working Group on Interim Finance for REDD: here
rmal-working-group-on-interim-finance-for-redd )
(Editing by Clarence Fernandez)
[Green Business]
Australia carbon laws in doubt, election possible
Tue Dec 1, 2009 1:49am EST
By James Grubel
CANBERRA (Reuters) - The Australian government's plans to cut carbon emissions were headed for defeat in a hostile Senate after the elevation of a new opposition leader opposed to carbon trade laws, setting a trigger for an early 2010 election.
Prime Minister Kevin Rudd, who met President Barack Obama on Monday in Washington, wants to take a lead role at next week's Copenhagen climate change summit by enacting a "cap-and-trade" scheme requiring polluters to buy permits for their emissions.
However, new Liberal opposition leader Tony Abbott said after his party-room election on Tuesday conservative senators, many of them climate change skeptics, would reject Rudd's emissions trading laws if they were not deferred until early 2010.
Abbott said he believed in climate change but told reporters he was opposed to the government's emissions trading scheme (ETS) model, the biggest economic policy change in modern Australian history, and was not afraid to fight an election on the issue.
"This is going to be a tough fight. But it will be a fight. You cannot win an election without a fight," said Abbott, a boxer in his university days who once studied for the priesthood.
Assistant Climate Change Minister Greg Combet said the government would still push for its carbon trade laws to be passed this week, and said he hoped some opposition lawmakers would side with the government and defy Abbott.
"The extremists have gained control of the Liberal Party. They are opposed to taking action on climate change, they dispute the science," Combet told reporters.
Rudd has struggled to have his climate change bill passed in the upper house Senate before parliament adjourns until February.
He wants emissions trading to start in Australia in July 2011, covering 75 percent of emissions in the developed world's bigger per capita emitter. The planned carbon trade scheme would be the biggest outside Europe.
The United States is watching Australia's debate closely. A political agreement on carbon trading in Australia would help garner support for action from other countries.
If the Senate ends up rejecting the carbon scheme for a second time, Rudd will have a trigger to call an early 2010 election on climate change, most likely for March or April. Polls suggest his government would win an increased majority.
If Rudd wins a so-called double dissolution election of both houses of parliament, he could then push his climate policy through a special joint sitting of the lower and upper houses.
BUSINESS, ELECTION UNCERTAINTY
Rudd has repeatedly said he does not want an early poll and would prefer elections to be held on time in late 2010.
Whatever the timing, the election would not be fought solely on climate change. Traditional issues such as the economy, unemployment and home loan interest rates would also dominate.
A decision by Australia's central bank to increase official interest rates on Tuesday, and for banks in turn to hike mortgage rates, gave Abbott the chance to pounce on economic management.
"The Australian people need to understand that each and every interest rate rise over the next 12 months is due to the irresponsible spending spree of the Rudd government," he said.
Abbott said while the opposition rejected the ETS, it still backed the government's emissions reduction target of at least 5 percent from 2000 levels by 2020, with a 25 percent target if nations agree on an ambitious climate pact in Copenhagen.
The prolonged debate on the ETS has caused some dismay among companies, coal and power firms in particular, who see some sort of scheme as inevitable and are looking for pricing certainty.
Banks and fund managers see the ETS as a boon for traders, investors and new green technologies, while major polluters generally oppose it as a tax on heavy industry.
International Power Australia, a unit of International Power and Australia's largest private-sector generator, says the uncertainty has impinged on talks with its lenders.
Major miners such as BHP Billiton and oil and gas firms such as Woodside Petroleum have criticized the scheme, although have been mollified somewhat by government pledges last month to raise state compensation.
"Australian industry is now thrown into total uncertainty regarding a price on carbon and therefore cannot make any informed investment decisions," said Tim Hanlin, managing director of Australian Climate Exchange Ltd.
"This is going to put Kevin Rudd under enormous pressure to call an election on this issue," he said.
Monash University analyst Nick Economou disagreed. He said Rudd would now miss his Copenhagen deadline and be in no rush for an election, putting the chances of an early poll at 20 percent.
"They may as well play the long game, the patient game," Economou said, adding Rudd would prefer a normal election later in 2010 to give him time to build an attack against Abbott's Liberals with the carbon laws waiting to be passed.
(Editing by Michael Perry and Paul Tait)
(For a graphic on the Copenhagen climate talks, click on:
here)
[Green Business]
FACTBOX: Sticking points for forest CO2 scheme at Copenhagen
Tue Dec 1, 2009 2:49am EST
(Reuters) - A U.N.-backed scheme that aims to reward developing nations for saving or rehabilitating their forests has made major progress during climate negotiations over the past two years and is likely to advance further at talks in Copenhagen.
But several issues still need to be resolved and will be discussed when negotiators from around the world meet in the Danish capital from next week to try to reach agreement on the outlines of a tougher global climate pact.
Here are some of the sticking points facing the scheme called reducing emissions from deforestation and degradation (REDD).
FINANCE
Rich countries, the United Nations and institutions such as the World Bank are putting up money to develop REDD. The problem is who manages the cash and governs how it will be used.
There are fundamental differences between developed and developing countries over whether the World Bank and other big lending agencies should disburse funds, or whether the United Nations should handle the money.
Developing countries have criticized the World Bank for being dominated by the United States and inflexible in its lending.
The United States and Australia tend to favor bilateral funding, to ensure a flow of forest carbon offsets to their future domestic emissions trading schemes.
SAFEGUARDS
One of the thorniest issues. It is widely agreed that for REDD to work, indigenous people or local communities need to be consulted and play a key role in fighting deforestation.
The problem is how to enshrine their rights into legal language all nations can accept. The current REDD draft negotiating text refers to the U.N.'s Declaration on the Rights of Indigenous Peoples, but these references are still in square brackets and therefore still up for negotiation.
Tricky, too, is how to ensure the full engagement of indigenous groups, plus maintaining an area's biodiversity and including all these into an internationally accepted regime that measures, reports and verifies steps to curb deforestation.
Protecting natural forests from being turned into plantations is another problem. The current draft text has two options, namely that any REDD scheme should not provide incentives for the conversion of natural forests and safeguarding the conversion of natural forests. Greens, such as WWF, prefer the first option.
The final choice of words is still to be made. Another problem is that the U.N. hasn't fully nailed down what the definition of "natural forests" is.
SCOPE
Lots more debate likely here. Should REDD just focus on curbing deforestation and build a reward structure on that basis, which is what Brazil wants?
Or should it be "REDD+," which would also recognize efforts to enhance carbon stocks, conservation of forests and sustainable management of forests?
India and others would like this option since they say they have stopped most deforestation and instead want to be rewarded for efforts to protect and expand what's left.
Brazil also objects to REDD becoming a purely market-based scheme with money flowing from the sale of carbon offsets, fearing rich nations would buy the credits and so avoid cutting emissions at home.
Others, such as Indonesia, back a market-based scheme and are working closely with Australia to bring this about.
(Sources: Greenpeace, WWF, The Nature Conservancy, The Prince's Rainforest Project and the Report of the Informal Working Group on Interim Finance for REDD: here
rmal-working-group-on-interim-finance-for-redd )
(Editing by Clarence Fernandez)
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