Overview of Carbon Polluter Rewards Scheme submissions
Posted by Dave Bath on 2009-03-31
This is a quick review of the public submissions on the CPRS bills, and a reminder that you only have little more than a week (2009-04-08) to get your general climate policy submissions into the Senate Climate Policy Committee. Email your thoughts to
Anyway, on to the review of those submissions published on the Carbon Pollution
Rewards Reduction Scheme: (and mine is here).
I’ve summarized the submissions, with a few sample snippets (both for good and ill – DES MOORE’S MAKES MY BLOOD BOIL).
- Professor Joshua Gans (PDF 456KB)
WELL WORTH READING! A fine broad submission, including arguments AGAINST compensating heavy polluters, with the following being a good philosophical point:
From an economic perspective, it is appropriate to compensate the losers from a policy if those agents undertook actions and were "surprised" by a policy. However, in the case of climate change policy, it has been on the cards for many years and so investors — in both trade-exposed and high emitting sectors — have known that carbon prices of some form were coming. In that situation, the case for compensation is limited indeed.
Summary: In summary, the ETS is not a diversified strategy and that is a problem. We need to cover measurement and political issues by investing in other direct ways of reducing emissions. We need to deal in a price-sensitive manner with trade-exposed industries rather than industry-by-industry. We need to cover innovation directly as the economy under an ETS cannot be guaranteed to do so. And finally we need to seek broader pollution abatement opportunities and target them.
- The committee received correspondence to its inquiry in the form of standard letters. An example of the letter is attached (PDF 44KB). These were recieved from: Mr Ray Gomerski; Mr Ian Addison; Mr William Shumack; Mr Peter Micenko; Ms Dora Ulgade; Sinclair Knight Merz; Ms Chloe Mason
This is why I argue against expecting form-letters or a single letter via a large group (like GetUp) to carry much weight… a single lineitem on the submissions list, each person thus punches below their weight.
- Olivier La Mer Adair (PDF 35KB)
Feels CPRS won’t be enough
- Alix Turner (PDF 116KB)
A farmer… makes the good point that it should be called "Atmospheric Carbon Reduction Scheme", but also hints at the scare tactics some people are using – arguing that if you are suspected of emitting too much you are treated by law worse than a terrorist. I wonder who drafted that bit of the letter sent to this citizen via the Farmers’ Federation?
- Dr Gideon Polya (PDF 351KB)
Heavy going, but good stuff. Lots of figures (linked, usually to scientific papers) on the difference between the targets and what is required, points out how the permits auction is "rigged" and "farcical". Good science, good data, but if politicians developed evidence-based outcome requirements and evidence-based policy to reach those outcomes, the CPRS wouldn’t be such a trough for big-carbon snouts!
- Australian Pipeline Industry Association (APIA) (PDF 196KB)
Makes the point that there should be a carbon tax, my guess is they are wanting something akin to GST tax calculations. From the submitter name, I’d expected something more denialist and was pleasantly surprised.
The failure to ensure that the CPRS enables full carbon cost pass-through is irresponsible and undermines the CPRS itself. The solution is relatively simple: the CPRS should be treated as a tax for the purpose of allocating costs under contractual obligations.
- Mr Tom Worthington (PDF 26KB)
From the Green ICT group and an academic, Worthington points out how much simply having green data centres and video-conferencing rather than travel can help. Obviously (and correctly) a fan of the Gershon Report and Tanner’s full acceptance of it. Also points to the IPCC saying that between a 25% to 50% cut is needed by 2020.
- CRC for Rail Innovation (PDF 45KB)
From the name, you can guess what they are pushing: better transport policy – and I agree. Let’s hope they make their submission to the wider and more relevant inquiry now open in the Senate Climate Policy Committee.
- Association of Tourist Railways Queensland (ATRQ) (PDF 46KB)
Knows they’ll face some costs, but are prepared to wear them for the good of all, as well as pushing for better general transport policy.
I’d love to know what this was… and why it was confidential.
- Griffin Energy (PDF 67KB)
A West Australian power supplier with the hands out for compensation and more time to get of their backsides. The only risk they perceive to Australia is that of short/medium capital supply, rather than the real risk of climate change.
- Mr Simon Corbell MLA, ACT Minister for the Environment, Climate Change and Water (PDF 168KB)
Supports the idea of the scheme but points out that voluntary action by state governments won’t achieve much because emissions permits won’t be cut accordingly.
- CITIC Pacific Mining Management Pty Ltd (PDF 165KB)
Asks for money not exactly as compensation, but to boost funds for a particular research/prototype effort they have for heamatite ore production that doesn’t qualify for permits. I can see their point – probably more deserving of support than the mob who want to do business-as-usual and get our funds.
- Cement Industry Federation (PDF 77KB)
After consideration for their industry (as expected), but notes they have decreased emissions over the last decade voluntarily by 23% on a per-tonne of product basis.
- Ian McGregor, University of Technology, Sydney (UTS) (PDF 121KB)
Argues that targets are pretty gutless, and for "Border Adjustments" rather than permit giveaways, with assistance based only on exported stuff rather than stuff used domestically. Good read.
If these trade-exposed firms choose to relocate elsewhere, with no consequent global reduction in emissions, it results in what is called carbon dioxide leakage. In other words, the carbon dioxide is still produced, just somewhere else. The better way to prevent this, than the free permits proposed is in the CPRS is Border Adjustment.
Border tax adjustments are a common feature of tax systems, like Australias Goods and Services Tax (GST) and European Value Added Taxes (VATs). GST, for example is payable on most goods that are imported into Australia, either at the border or the point of sale. Exported goods are generally GST-free. In the same vein, many Australian travellers will be familiar with the opportunity on departure from European airports to obtain VAT refunds for major purchases. Border adjustments are not tariffs or export subsidies, but an integral part of consumption and production tax systems that serve to clearly define the tax base and protect the revenue.
Border adjustments have been proposed as a solution to carbon leakage in the United States and Europe, but have not yet been adopted for this purpose by any country. The United States, however, has implemented border adjustments for two environmental taxes, the ozone-depleting chemicals (ODC) tax and the Superfund chemical excises. These border adjustments were applied not only to the target chemicals, but also to certain other traded products that are manufactured using these chemicals. They applied regardless of whether the target chemicals were consumed in the manufacturing process or physically incorporated into the traded good.
- Dr Chloe Mason (PDF 63KB)
Points to possible burdens on public transport but not private transport. Doesn’t like the CPRS at all, especially where it goes contrary to Garnaut.
- Mr Des Moore (PDF 741KB)
GRRRRRR! Institute for Private Enterprise DENIALISM! Don’t read the following quote if you suffer hypertension!
The belief that increasing emissions of CO2 (sic – no subscript of the 2 like anyone into science would do in a PDF) threaten dangerously higher temperatures is based on claims that are increasingly exposed as false or grossly exaggerated.
- Dr Klaus Weber (PDF 12KB)
Says 20-40% reduction needed by 2020, not 15%, and that taxpayers will feel the pain but polluters get a windfall.
- Dr David Tranter OAM (PDF 17KB)
Points to market failure of finance system as a model for market failure on Carbon.
..Growth is more and more of the same stuff; development is the same amount of better stuff. Perhaps the time has come to consider the merit of steady-state economics as a means of stabilising both the global climate and the global stock market?
- Mr Andrew Farran (PDF 15KB)
A farmer gainst ANY hassling of pastoralists, permanently, for anything to do with carbon. Don’t think he is in line with Landcare-members (who are mainly farmers), and don’t think he is a fan of ABC "Landline" editorials. (Seriously: ABC Landline is a GREAT show… a real eye-opener for those of you who’ve been big city folk all your lives. Watch it!)
- Energy Supply Association of Australia (PDF 1731KB)
The "We Are Coal and Want More Taxpayer Dollars" line
- Mr David Kault (PDF 9KB)
Points out CPRS is full of loopholes and advocates a carbon tax structured a bit like the GST
- Quintessence (PDF 98KB)
Points out cap-and-trade doesn’t encourage action, especially with free permits, and advocates a "feebates" system that transfers money from carbon polluters to carbon "sinks" (or at least that’s my understanding on a quick read)
- Dr Judith Ajani, Fenner School of Environment and Society, The Australian National University (PDF 92KB)
Calls the CPRS "incoherent" and mainly deals with shortcomings of the bill with regards to "reafforestation" definitions and treatment.
- Dr Geoffrey Davies, Research School of Earth Sciences, The Australian National University (PDF 117KB)
In the "targets are too little too late" camp and points out that some emissions lowering can save money.
- Climate Action Canberra (PDF 22KB)
Pretty much what you’d expect, hates free permits, short and to the point, but the following is one line on the CPRS I really like:
a CPRS will… entrench the "right to pollute" as property
- Australian Workers’ Union (PDF 132KB)
Looks more interested in the short-term economy… motherhood statements that could have been written by the Big-Carbon lobbyists
- Carbon Sense Coalition (PDF 215KB)
Another warm-fuzzy-name-cold-sharp-intent lobby group arguing for a max of 10% cuts because GRRRRRR AT NON-SEQUITURS THAT MAKES MY BLOOD BOIL (and probably Garnaut’s too)…
Carbon dioxide emissions are directly proportional to our own standard of living
The only chance of achieving even the "moderate" cuts proposed is if the war on carbon and other factors causing a long and deep economic depression…
AAAAAARRRRRGGGGHHH!!!!! and their climate-change denialism is worse than Des Moore’s. Looks like they think their members are un-retrainable for green-collar jobs!
- Mr Gerard De Ruyter (PDF 12KB)
Argues that it is a "good first draft" but too weak, permits as "property rights" given away freely are a BAD THING, etc
- Australian Geothermal Energy Association (PDF 155KB); Attachment A (PDF 97KB); Attachment B (PDF 755KB)
Sensible about the need for a scheme, dubious (if not sarcastic) about "national interest" concessions, and points to bugger-all support in th bill for emerging technologies that might help. Again, these folk should make a submission to the wider inquiry on Climate Policy now open for a few more days.
- Mr David Bath (PDF 71KB)
Agree with everything in this submission, funnily enough! Shame about a couple of typos though.
- Mr Ian Dunlop (PDF 100KB)
Objectives are based on old science, so targets in the CPRS are gutless, and angry about "compensation" to polluters. Mainly works from a perspective of Risk Management… and gives the government the thumbs down. Nice one.
- Mr Barry Brook and Mr Tim Kelly (PDF 175KB)
Two academics in the climate change and sustainability field. Prefer a carbon tax to cap-and-trade, because cap-and-trade discourages individual actions. Punchy and well worth reading in full.
A cap and trade mechanism is by its nature an all consuming policy instrument that extinguishes the effectiveness of voluntary actions, harming rather than enhancing the evolution of a low carbon economy.
- Dr Andrew Glikson, Research School of Earth Science and School of Archaeology and Anthropology, The
Australian National University (PDF 648KB)
Good science pointers from a climate change expert, and points out that the current financial mess is a great time to make changes rather than an excuse for weak action as well as stressing the link (again, expert opinion) between recent droughts, etc, and CO2 changes. Concise yet not-oversimplified and not-uncited-reasons why radical action is the most conservative thing to do.
- Locals Into Victoria’s Environment (PDF 288KB)
Science stressed, lots of good footnotes and citations, and has the following great line (my bolding):
Notwithstanding the Government’s mandate, its own research findings and its stated policy aims, Australians have been presented with an emissions trading scheme, the CPRS Bill which, as the rest of the world enters a low carbon era, will further entrench Australia in a quarry ‐ that is, one with high volume pollution and low value economy ‐ by protecting, compensating and rewarding our biggest polluters for being just that.
- Australian Plantation Products and Paper Industry Council (PDF 51KB)
Makes other interesting points on reafforestation, often from the perspective of small growers, with the following attracting my attention, because it looks like the CPRS bill is making it easy for big industry rather than little guys, not just for pollution, but also on the sequestration side:
These requirements imply that there is a liability on all parties who have an interest in the land – but only the carbon right owner is able to profit by opting into the scheme.
- Housing Industry Association (PDF 47KB)
Argues against sloppy drafting and regulation, with monitoring important, and raises the possibility of linking CPRS to "Free Trade Agreements" to prevent carbon leaking… they have a good point which I sort-of touched on in my own submission which advocated the possibility of carbon tariffs on polluting countries.
- Australian Ethical Investment (PDF 115KB)
A major "green" investor, with the following major concerns about a government intent on satisfying legacy companies rather than innovation (my bolding):
- The scheme lacks any grandfathering, or equivalent compensation for existing emissions trading schemes, such as the NSW Greenhouse Gas Reduction Scheme (GGAS). This un-necessarily penalises the early adopters and promoters of green house gas abatement – a highly unusual outcome for a national emissions trading scheme.
- The scheme risks creating a hostile investment environment for abatement industries. We have learnt anecdotally that coal miners would consider abandoning existing abatement facilities, and simply flaring waste gas. This is an example of how the scheme will have an adverse impact on the landfill gas and coal mine methane power generation industries
- Energy Networks Association (PDF 96KB)
Wants "passthrough" carbon, because they are basically a gas-pipe group rather than producer or purchaser, and don’t want the hassle of having to get some financial certificates just because carbon trading is considered a trading instrument. Diddums!
- Chevron Australia (PDF 54KB)
Another whinge about "trade-exposed" giveaways not being enough for them (LPG) compared to coal. In my view they should be treated equivalent to coal (they might sound happy at that), because neither should get ANY giveaways at taxpayer expence (oooh, they’ll hate my stance now).
Other parliamentary submissions from me and my mates… if you’ve made one, add a comment, and I’ll move you into the main body of the article.