Beazley's tepid climate policy has failure written all over it [March 15, 2006]

Labor's attachment to the Kyoto Protocol will please trendies but not the party's traditional voters, says Economics editor Alan Wood
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March 15, 2006
KIM Beazley has released six policy blueprints since August. Name four. How about three? OK, he released blueprint No.6 last week. What was it called? No? It was called Protecting Australia from the Threat of Climate Change. Hands up if you think Kim can do it.

In case you missed it, he says Australia needs a government that puts the preservation of our environment before its own political self-preservation. Labor's climate change policy satisfies at least this criterion.

It is likely to have about as much appeal to Labor's traditional working-class base as Mark Latham's forests policy did to Tasmanian timber workers. It is, of course, designed to appeal to the latte Left and the green secular religionists whose votes Labor so desperately courts.

To be fair, it could have been worse, but that doesn't make it good policy. It means it is sensible in parts, and those parts clearly owe a great deal to ALP frontbencher Martin Ferguson and little to Beazley or shadow environment minister Anthony Albanese.

The fundamental flaw that undermines the whole policy is its commitment to sign up Australia to the failed Kyoto Protocol. This commitment assumes, contrary to all the evidence, that Kyoto is not only alive and well but that its guiding principles and enforcement mechanisms will be successfully extended and made much harsher after the present treaty expires in 2012.

The truth is that Kyoto displays about as many vital signs as Beazley's leadership. Its basic failure, and the reason it has no future, is that it excludes countries that are the globe's biggest emitters of greenhouse gases: the US, China and India.

These countries simply won't sign up to Kyoto's emission targets and timetable, something they have made abundantly clear for a long time. Consider the testimony of Australia's then ambassador for the environment, Christopher Langman, a career diplomat, to a Senate committee inquiry on ratification of the Kyoto Protocol in 2004. Langman told the committee that whenever there was a discussion in Kyoto negotiations of how the developing countries might sign on to the protocol's emission targets, even in the second commitment period after 2012, it led to a breakdown of the talks.

"India and China and indeed the group of developing countries, the G77, have made it quite clear that they are not willing to accept or discuss anything that looks like a legally binding obligation to constrain their greenhouse gas emissions," Langman said.

Even British Prime Minister Tony Blair, a Bob Carr-style green religionist, has recognised Kyoto is not a goer, and said so. And Ferguson, even if he pays lip service to Labor's Kyoto commitment. Last October he quoted Blair, who said he had changed his thinking about climate change: "The truth is no country is going to cut its growth or consumption substantially in the light of a long-term environmental problem." Blair also said he didn't think people would be negotiating another major treaty like Kyoto for some time.

Yet Kyoto forms the spine of Beazley's climate blueprint. His two big ideas are a cleaner coal industry and a solar power industry as big as coal is today. Cleaner coal technology is so obviously a sensible policy for Australia, with its abundant resources, that it has already been backed by the Howard Government and the coal industry and is uncontroversial.

Solar power is another matter. It may be economic over the long term, but it certainly isn't now.

However, let's not argue about that and concentrate on Beazley's big picture. He says the transformations he envisages are ultimately economic. "They can't be driven only by central command and control and public sector spending. They won't happen without all the economic incentives."

So what will he do? "Let me turn to Labor's market reforms. Labor will sign the Kyoto Protocol." That's it? Not quite. Labor will set a mandatory emission reduction target. The target will be a 60 per cent reduction in greenhouse emissions by 2050. So much for no command and control.

We will have a Kyoto command and control system for limiting emissions and an emissions target that will be extremely costly in its impact on industries, jobs and economic growth. And what would it achieve? Given Australia accounts for about 1.5 per cent of global emissions, not much.

Naturally, Beazley doesn't want to talk about the costs involved. Yet last year a report by the British House of Lords on the economic costs of climate change made the powerful point that the public needed to be clearly told the costs of targets such as a 60 per cent reduction in emissions.

It said the reaction to rising petrol prices in 1999-2000 showed how sensitive the public was to even a modest rise in energy prices. Yet it was not told of the cost of climate policies with a much more substantial impact. The same telling criticism applies to Beazley's policies.

And all this is based on still uncertain climate science. The way ahead is not Kyoto but a framework that involves the world's big greenhouse gas emitters, and the Howard Government's Asia-Pacific Partnership on Clean Development and Climate looks like a fruitful path to follow.

Covering the US, Japan, India, China, South Korea and Australia, it accounts for nearly half the world's energy consumption and greenhouse gas emissions. And it avoids the fundamental flaw in Kyoto of legally binding caps and timetables that are completely unacceptable to the key countries involved.

Ferguson knows that. A pity Beazley and Albanese don't.

Fortunately, nobody remembers the Beazley blueprints, which makes them easy to scrap if Labor ever does get back into power.