Multibillion Dollar Taxpayer Bill As Australian Emissions Rise And Projected To Keep Rising Without Substantial New Policies

Climate Institute

Taxpayers could be slugged for $12b-$25b if the Emissions Reduction Fund remains the Government's principal policy tool for reaching its inadequate 2030 target of 26-28 per cent below 2005 levels by 2030. Removing policy options from the 2017 review is a costly mistake.

According to government data out today, Australia’s emissions have increased by over four million tonnes in the year to June 2016 and are projected to keep rising to 2030. Without stronger energy and climate policies, government’s own inadequate 2030 target will be blown by around a billion tonnes, said The Climate Institute.
“With the government ruling out a policy option that would make companies take responsibility for their own emissions, this billion tonne gap could see taxpayers slugged for $12 to 55 billion if the Emissions Reduction Fund remains the government’s principal policy tool,” said the CEO of The Climate Institute, John Connor.
“These results are a national embarrassment, so it’s not surprising that the government has released this data as close as possible to Christmas. Despite having committed through the Paris Agreement to reduce our emissions to net zero, our emissions are still going up, not down – and it is because we don’t have effective policies to reduce them.”
“Though the government has committed to reducing emissions by 26-28 per cent below 2005 levels by 2030, the projections show Australia is currently on track to blow that target by about 1 billion tonnes. If we were serious about our Paris commitments we should be 65 per cent below 2005 levels by 2030.
The latest emissions inventory shows that emissions from electricity, transport, and industrial processes all went up. This reflects the absence of effective policy to decarbonise these sectors.
“The latest projections show that, in the absence of policy changes, national emissions are expected to continue rising over time,” he said. “The federal Renewable Energy Target is projected to help decrease electricity emissions till it stops growing in 2020. Without extra policies electricity emissions are predicted to rise again thereafter.”
The government is to review its climate policy framework next year, but has already withdrawn one widely recommended option, an emission intensity trading scheme.
“Given the proven ineffectiveness of the government’s existing climate policy framework, removing anything from the table before the review has even commenced is a very costly mistake,” Mr Connor said.
“With 80 per cent of the $2.55 billion Emissions Reduction Fund already used up, it will clearly need more of taxpayers’ money.”
If the Emissions Reduction Fund were to carry the billion tonne gap, this would cost at best $12 billion (based on the average price per tonne in the ERF’s last four auctions) but potentially $55 billion (based on the IPCC’s estimate of a global carbon price consistent with the government’s target).
This data released in the shadow of Christmas makes clear that the Government needs to get serious on energy and climate policy reform. There are far cheaper options than just relying on the taxpayer, and the 2017 review should be able to examine them all, said Connor.

Links

• Malcolm Turnbull rules out carbon tax or emissions trading
• Federal resources minister accuses ABC of 'fake news' over Adani coalmine 
• Finkel review criticises climate policy chaos and points to need for emissions trading
• Australia needs two emissions trading schemes, Climate Change Authority says
• Malcolm Turnbull: Labor's climate targets will destroy Australia's bargaining power