Department of the Environment, Water, Heritage and the Arts logo
Department of the Environment, Water, Heritage and the Arts home page

Archived media releases and speeches

Disclaimer

Much of the material listed on these archived web pages has been superseded, or served a particular purpose at a particular time. It may contain references to activities or policies that have no current application. Many archived documents may link to web pages that have moved or no longer exist, or may refer to other documents that are no longer available.

Transcript
Minister for the Environment and Heritage
Senator the Hon. Ian Campbell

Monday, 14 February, 2005

Comments on Kyoto


Campbell
I just thought I'd take the opportunity to make a few comments on climate change and global warming as Mr Albanese and Mr Beazley have decided to pull a bit of a stunt and link the romantic and slightly frivolous Valentine's Day with the very serious, important issues of climate change.

I'd like to say that just signing a Kyoto Protocol or pulling a post card stunt about the Kyoto Protocol, is no substitute for a policy. What the world's going to need to address climate change is in fact two very important and very expensive things.

Firstly, significant domestic action, so replacing high greenhouse gas emitting power stations with low emission alternatives, moving to those low emissions alternatives, investing heavily in renewables, investing heavily in new technologies, to reduce our emissions profile yet keep expanding our economy. These measures are expensive, they require solid policy not stunts.

What I challenge the Labor party to do today, if they are going to bring forward a Private Member's Bill is to ensure that the Private Member's Bill isn't just a postcard or a stunt, that it actually shows Australians how they intend to implement the Kyoto Protocol. If they say we are going to sign up, how are they going to bring in domestic measures to reduce our emissions but also an international mechanism that sees the world meets target, because the Kyoto protocol simply doesn't do that. Saying that you'll sign the Kyoto protocol doesn't reduce domestic emissions. It takes high levels of investment. The Federal Government has indicated it's willing on behalf of the Australian community to make those investments about $1.8 billion in a whole range of technologies.

Furthermore, I think that if the Private Member's Bill Mr Beazley or Albanese are putting into the Parliament today is any more than a stunt and a glorified postcard, then we need to see in it, the full details of the proposed national emissions trading scheme. We need to have a clear enunciation of just what that scheme will cost the consumers of Australia. What it will cost the households in terms of their power bills. What it might cost for the transport sector and what it'll cost for industry.

Reducing greenhouse gases is not a cost free exercise, that's why the Government is investing $1.8 billion. Labor's policy is to have a national emissions trading scheme that will cost all consumers. We need to understand what those costs are, we understand that the Carr Government and the Labor states have more broadly have a national emissions trading scheme designed. We also understand that they have no intention of releasing that before the WA state election, because there will be costs involved. The Allen Consulting Group have looked at national emissions trading schemes and have come up with costs that vary from a 27% increase in power bills and the lowest estimates between 2-6% increases in power bills. So there are costs involved, what Mr Beazley and Mr Albanese and the Labor premiers want you to believe is that you can have a substantial solution to addressing climate change and therefore to be no cost on households or industry.

We challenge Labor to go beyond stunts and emblems, beyond linking this very important and serious issue with the frivolous and come up with substantial policy and come clean on exactly what Labor's plans mean to the consumers of Australia.

Journalist
But doesn't Albanese have a point in saying that your position is contradictory in the sense that you say the current protocol is detrimental to the economy and yet you're arguing for a stricter regime down the track.

Campbell
No, we're saying that the Kyoto Protocol is ineffective in that during its period, the scientists expect that greenhouse gasses will actually increase in the world because it doesn't have a pathway for developing countries. It basically says, let's just ignore them for the time being and furthermore what I'm challenging Labor to do today, is rather than just talking about stunts, what is their policy? Signing Kyoto is not a policy, that's a stunt. What they need to do is tell us what their national emissions trading scheme looks like? What are they going to trade within it? Are they going to trade intensity measures or carbon credits? The Australian people need to get to understand these terms because Labor intends to bring it in with or without federal Labor support and the WA election which occurs in less than two weeks time is the important test of that policy, if we in fact know the details of it before the election.

Journalist
So you're labelling Kyoto a "stunt". Is that what you're saying?

Campbell
No, Mr Beazley's proposal to send out postcards on Valentine's Day is a stunt. It of course reduces the importance of the whole policy area. The Commonwealth's investing $1.8 billion in measures to address it. They obviously don't think those policies work, we want to know what the alternative policies are and what they will cost.

Journalist
Aside from a domestic carbon trading scheme, can you guarantee that Australian industry or the economy won't miss out with the introduction of a international trading scheme?

Campbell
Well, what we see in the European trading scheme so far is a very lack lacklustre performance. It's only early days and I actually genuinely wish it well. There's a story overnight from the carbon trading in Europe that says the sort of price that carbons now sunk to on that very early market is getting so low that it will make no policy effect on global warming. It reinforces my view that unless you have a comprehensive agreement that includes all of the emitters, that includes China, India and America then you won't have an effective emissions trading scheme. That's the fundamental flaw of Kyoto, it wasn't able to bring in all of the major emitters and I've been very public. I think that ultimately trading will be part of the solution as long as the transaction costs are low. As long as you really maximise the benefits of it, it's like everything in public policy, it's costs and benefits. The cost of the European trading scheme seems to be too high at the moment.

Journalist
So if the trading scheme is part of the overall solution, what work is the Australian Government doing to investigate how we can participate in such a scheme?

Campbell
Well that's one of the focuses of our work, is to try to engage both developing and developed countries. Not only in looking forward to some comprehensive international framework but also looking at the practical things we can do in the meantime. So we are working within the geo-sequestration international agreement framework. We are working on a whole range of practical projects which will in the interim reduce greenhouse gas emissions across the globe and while we're doing that, looking for pathways to a comprehensive agreement that ultimately may lead to a trading system that works.

Journalist
(inaudible) contradiction between pursuing greater targets down the track and talking about Australia's (inaudible) specifically, not signing the Kyoto Protocol (inaudible)

Campbell
I don't think it's contradictory. My view is that Australia, to be successful needs to be part of an international agreement that's successful. In the meantime, diminishing investment in low emissions technologies and the very technical solutions that can provide the answers is counter productive. We want Australian industry to make profits, to be successful, to export high quality energy products. We want to see Australia export gas to California. That's good for greenhouse gas reductions globally. So you need an agreement that encourages that and Kyoto actually works against it. So I don't see a contradiction, I can see how people would seek to pay the contradiction but Kyoto works against Australia's highly energy efficient industries exporting to the world. We should have an international agreement that encourages countries like Australia to smelt aluminium here because we can do it more efficiently than just about every country in the world. We shouldn't be penalised for that so its works against our economy and against the global environment so sign onto an agreement that achieves neither.

Journalist
But given that you've already committed Australia's meeting the Kyoto target, you say we're on track to meet by the (inaudible) and the economy is not at all being affected by that progression. Why not just sign up and (inaudible)

Campbell
Well that would be the easy thing to do and all of you know that Mr Beazley does generally sign up to the easy options. We're not going to do that, we don't want to just sign something because it'll give a warm inner glow for a few days because we'll be found out in a couple of years time.

We are, for very good reasons, showing that using technology, you can in fact, expand the economy. I think one of the things all Australians should be proud of, rather than having people Albanese and Beazley putting us down, going around saying that we are the biggest energy emitter per capita. I mean why would you

Journalist
But we are ...

Campbell
But why would you say it's a bad thing. I mean the solution to that is to double the size of our population then all of a sudden you solve that statistic. We are a very big country with huge energy resources and a very small population. So why would we criticise ourselves for that? Why not say that's a wonderful thing that Australia produces energy, efficiently and exports to the rest of the world. Why would you put your own country down? It's particularly un-Australian.

Journalist
That heavy energy reliance in Australia, does that exclude Australia of ever becoming involved in the international agreement?

Campbell
Australia's closely involved in the UN Framework on Climate Change. We're respected around the world and I was going to say, one of the things that we've achieved is that during the Kyoto period from 1990 - 2011, we'll double the size of this economy yet our greenhouse gas emissions will only go up by 8%. So it shows that an economy can expand rapidly and still keep its greenhouse signature under control. We have to take that achievement, technologically and economically and environmentally and see us double the economy again in the generation after that, but in that generation use the technology that's available to in fact reduce the greenhouse signature. That's what's going to be on it, it's a technological issue we're facing up to, which will involve trillions of dollars of investment across the world to see us expanding the economy yet reducing our emissions. That's the challenge, it's a technological challenge that needs expanding economies to pay for it, putting in artificial constraints will actually work against the environmental benefit.

Journalist
Is it possible to achieve the deep cuts you say are required, without raising the cost of carbon emissions through a price signal such a tax or a trading scheme?

Campbell
Australia is proving that you can have massive economic expansion and yet a controlled emissions signature and the way to get the deep cuts that I believe will be needed over the next 25-50 years is through technological breakthrough and you'll get technological break through by having expanding investment available. Now whether ultimately a trading scheme is the best way to encourage that investment or to use the sort of policy approaches we're using, the jury will be out on that for a decade or so. I've always said that if you've a comprehensive trading scheme that involves all of the major emitters that that's likely to be part of the solution. I've always thought this for a decade. I've always thought it would be part of the solution but it will only work if the costs and the benefits work out and we are far from that at the moment.

Journalist
That would mean the cost of emissions would have to go up?

Campbell
There will need to be found a price signal for carbon emissions, but you'll only get an effective price signal if you've got a comprehensive agreement that includes all major emitters. Setting up a private little club and trading in it and ignoring the rest of the world when it is truly a global problem. A tonne of carbon that goes up here is a problem for people on the other side of the world so pretending you can have a private club in one part of the world and ignore the rest of it, is not a way to design an effective trading scheme. That's really what happened within Kyoto.

Commonwealth of Australia