Australian coal mining billionaire politician Clive Palmer announced on Tuesday that his party’s Senators will vote against the Emissions Reduction Fund (ERF), the Abbott government’s proposed replacement for the carbon price it wants to repeal. Palmer wants the promised ERF funding to be redirected to pensions, and says he is even prepared to block budget bills if necessary.
Undeterred, the Government has pressed on, releasing the ERF White Paper on the eve of Anzac Day (in the tradition of the Green Paper released on the last day before Xmas). But with Palmer offside, ERF legislation will struggle to find any support from non-government Senators.
Labor and the Greens oppose the ERF as too weak. The Motoring Enthusiasts will vote with Palmer United. The Liberal Democrats, Family First, and Democratic Labor are unlikely to support any climate policy because they don’t believe the problem is real. And independent Nick Xenophon won’t support the ERF unamended. That makes up to 43 votes against the ERF, and only 38 votes are needed to block legislation. So it is very unlikely that Abbott will be unable to pass the legislation. This leaves Abbott with almost no climate policy (except the soon-to-be-neutered Renewable Energy Target, and some other bits and pieces that won’t achieve much).
Whether or not Abbott is able to implement the ERF probably won’t make much difference to emissions, because the ERF is a laughable scheme which will pay polluters to (in theory) voluntarily act to avoid emitting CO2 they otherwise would have emitted. I’ve written previously about 21 reasons why Abbott’s policy won’t work, including some issues which have received little attention – and almost all of what I said then remains essentially accurate.
Another thing which will make no difference is the “safeguard mechanism”, the penalty for polluters who exceed their baseline emissions levels under the ERF. Too many people are withholding judgment until the details are announced, when in fact we already know all we need to know. All ERF policy documents have made clear that both the fund itself and the supposed safeguard will allow emissions to increase wherever production increases (even if historical absolute baselines are used they will not apply to new companies or significant business expansion). In other words, the ERF is designed to cut emissions intensity (emissions per economic output), not absolute emissions. This is pointless as emissions intensity will fall automatically even if emissions rise; the problem is that those efficiency gains are being cancelled out by the exponential growth of the fossil fuel economy. The Government is budgeting zero revenue from the safeguard mechanism because they know it will never come into play.
What’s new in the White Paper?
- The policy objective, which used to be to meet Australia’s inadequate emissions target of 5% below 2000 by 2020, is now merely “to reduce emissions at lowest cost over the period to 2020, and make a contribution towards Australia’s 2020 emissions reduction target”.
- The White Paper contains endless impenetrable text about how the Government will design emissions-reduction-verifying “methods” (through consultation with polluters), but there is still no reason to think these methods will have any validity. We do learn that methods will be reviewed by an “independent expert committee” called the Emissions Reduction Assurance Committee, which would be reassuring if the Abbott government didn’t have a history of appointing ideological allies to such panels.
- ERF funding is still capped for the first four years, and it sounds like beyond that funding will be decided in each budget. Again this is hardly reassuring, as every climate program’s funding seems to diminish over time.
- Polluters who fail to deliver emissions cuts contracted by the government must “make good” by purchasing offsets from other domestic companies. I cannot find any mention of earlier proposals to allow international offsets, though business groups continue to lobby for this.
- The 2015 review of the ERF will focus merely on operational elements.
A few journalists have made some half-hearted attempts to get more information out of Environment Minister Greg Hunt, but whenever he is asked a question about the ERF he just starts rabbiting on about how bad the carbon price was. Meanwhile, we’re hearing more and more from government members and advisors that climate change isn’t real after all. In the last fortnight, Attorney-General George Brandis, government backbencher George Christensen, and Abbott’s business advisor Maurice Newman have all challenged the science of climate change.
Perhaps they’re ramping up their attacks on science because they realize the ERF is losing credibility. Because there is one way in which it does matter whether the ERF goes ahead. If it proceeds, Abbott will be able to use it to support the talking point that his government has a policy on climate change, reassuring voters who are concerned about climate change but nervous about the alleged costs of a carbon price. But if the ERF founders, and Abbott succeeds in his overall agenda of climate deregulation, then he will have no significant policy to greenwash his government. And as the hot summers keep coming, there’ll be nothing to stop those concerned voters from becoming alarmed.