A controversial Abbott-era fund that uses public money to pay companies to reduce their pollution will survive the federal government's review of Australia's climate policies.
In an interview with Fairfax Media, Environment and Energy Minister Josh Frydenberg also expressed confidence that future generations would avoid disastrous predicted impacts of climate change, saying technology would drive the transition to decarbonised economies and "get us where we need to be".
Climate summit seeks new direction
More than 200 institutional investors with $26 trillion in assets under management said they would step up pressure on the world's biggest corporate greenhouse gas emitters to combat climate change.
More than 200 institutional investors with $26 trillion in assets under management said they would step up pressure on the world's biggest corporate greenhouse gas emitters to combat climate change.
Among the measures being evaluated is the $2.55 billion emissions reduction fund, which provides financial incentives, in the form of carbon credits, to polluting companies that cut their emissions.
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| Environment and Energy Minister Josh Frydenberg at Parliament House. Photo: Alex Ellinghausen |
The government purchases the credits in reverse auctions using taxpayer funds. Pollution can be cut through measures such as improving energy efficiency, capturing methane from landfill, tree planting and storing carbon in forests and soils.
Critics argue that taxpayers should not be paying polluting companies and that many of the projects would have been carried out anyway, as part of normal business.
Others say the fund has systemic problems and that up to half the claimed abatement does not exist.
All but $265 million of the fund has been spent over six auctions, and the government did not top up the fund in this year's federal budget, prompting speculation over its future.
Mr Frydenberg said the fund had contracted more than 180 million tonnes of abatement at under $12 a tonne which was "pretty cost effective".
"It certainly has a role into the future and [especially in regards to] the concept of emissions reduction out of the land sector," he said.
"It's been effective, it's important and it does inform us in terms of the future options we have."
His office later confirmed the fund "will be continued". However Mr Frydenberg did not say how much would be allocated to it in the next federal budget.
He also declined to say if the fund's safeguard mechanism, which requires heavy polluters to keep emissions below baseline levels, would be tightened to force behaviour change.
Experts say big industry has not warmed to the fund, and it mostly supports projects such as carbon farming - where farmers are effectively paid to plant trees - vegetation management, savannah burning, landfill projects or energy efficiency.
A Climate Change Authority report released this week warned that 139 million tonnes of carbon to be stored in vegetation and soil projects was "a significant risk", partly due to its vulnerability to fire.
However it found the fund was "generally performing well" and would help Australia meet its international commitments.
Charles Sturt University public ethics professor Clive Hamilton, who resigned from the agency in February, dismissed the report and said the fund was a discredited "bastard child whose existence no one wants to acknowledge".
Government opponents say Australia needs a higher proportion of renewables in its energy mix to meet the Paris targets – which are themselves too low, according to some.
Asked if he was personally concerned about the potential effects of climate change on future generations, Mr Frydenberg told Fairfax Media that he felt "confident" the worst impacts could be mitigated.
"There is a huge amount of work to be done, but I have enormous faith in technology to support that evolution to low-cost emissions reduction across the economy ... to get us where we need to be," he said.
Links
- Review of Australia’s climate change policies
- Australian climate politics in 2017: a guide for the perplexed
- Submission to 2017 Review of Australia's climate change policies
- Climate Change 2017: Restarting the debate | Grattan Institute
- Australia – 2017 Australian Government Climate Change Policy Review
- A 2050 emissions target is an essential outcome for the federal government’s 2017 climate policy review
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