Labor is in the middle of a delicate balancing act on climate: it’s seeking to appease both those demanding action and workers worried about their jobs.
The pitch: a commitment to reduce emissions by 43% by 2030. Conservative by many international standards but more than the Coalition’s official target of 26 to 28%, and its adjusted estimate of 35%.
How will Labor do it? Not by putting a price on carbon. In fact its carbon credit scheme builds on existing Coalition policy, and is distinctly not a carbon tax.
The Coalition is attacking the policy as being too left, too vague, costing too many jobs and aligning with the Greens. But Labor is actually closer to business groups. How close? We checked.
Business Council of Australia
The BCA has advocated for 46-50% emissions reduction targets by 2030. It described the target as “both ambitious and pragmatic”.
The Achieving a net zero economy report, published in October, offers a number of recommendations around achieving that. The key suggestion involves adjusting the existing safeguard mechanism by gradually reducing the emissions baseline to incentivise further deployment of low emission technologies. Rather than a carbon price, this policy would in effect create a carbon credit, a positive incentive to adopt renewable technology.
According to the BCA: “The momentum for moving towards net zero by 2050 is unstoppable.”
And the message is clear: it makes good business sense to adopt ambitious emission targets.
Australian Industry Group
Ahead of the COP26 meeting in Glasgow, Innes Willox, chief executive of the Australian Industry Group, called for targets to halve emissions by 2030. This largely aligns with the BCA.
The AIG welcomed Labor’s 2030 targets and policy platform, but emphasised that “no matter who forms Australia’s next federal government, the call for greater ambition will need to be answered and the challenges of achieving it will need to be navigated.”
The AIG is Australia’s largest industry association, representing more than 60,000 small and large businesses.
Labor
In announcing its plan, Powering Australia, Labor’s energy and climate change spokesman Chris Bowen promised that “not one” job in traditional industries would be lost. Instead, 604,000 jobs would be created, $76 billion in investment would be stimulated, and power costs would go down.
It would achieve that with a suite of policies including updating the electricity grid to support further wind, solar and battery infrastructure, and a version of the Coalition’s “safeguard mechanism”, which would see a $15 billion national reconstruction fund provide the industry with low-cost financing to embrace clean energy. This safeguard will rely on improved technology and company-funded carbon offsets.
Sound familiar? Labor’s policy borrows a lot from the BCA recommendations. Until now, the BCA and Labor sharing a policy position would have been rare, so this signals movement on both sides. And by embracing a carbon credit as its key policy, accusations of a carbon tax will be quickly dismissible.
With this policy, Labor hopes it will demonstrate a greater commitment to climate action than the Liberals, while also strongly differentiating itself from Greens’ policies. It is aiming for an achievable middle ground, leaving room for more ambition and — if all goes to plan — doing just enough to keep everyone happy.
Big business supporting Labor’s climate policy…only a decade (give or take) too late. They along with Abbott’s Coalition government trashed Labor’s ETS until it was repealed. Must be a buck in it for them now. Hypocrites.
It would be a mistake to think that the reduction doesn’t have to be done until somewhere near 2030. The revolution needs to start right now, with momentum and achievements next year and every year after. That is, the momentum of change starts tomorrow and never stops. The BCA proposal would require us to average painful reductions of 9% across every one of the eight years to 2030. Neither should the momentum stop at 2030, because there is an even greater momentum of change required from then on to 2050.
Most urgently, we need to identify all uses of gas, and adapt them to non-fossil energy. Right now we should be confronting our fears and preparing ourselves for the revolution.
Funny how the worm has turned, isn’t it? Of course I could be cynical in thinking that the sudden about-turn from “Big Business” and its support of Labor’s current environmental Policy, may be, just maybe, something to do with shareholders’ questioning their respective Board’s decisions to continually deny scientific research and evidence? Moreso now, as the public is pushing for more Climate action, perhaps?
We may but pray ’tis so.
A carbon tax with every dollar returned as cash to the public is the best, easiest and fastest way to zeroC.