This morning, a long-standing assumption of mine about emissions trading was blown completely out of the water. I’d always thought the purpose of an emissions trading scheme was to get industries who are chocking our atmosphere with greenhouse gases to stop – the prospect of heavy financial penalties being the incentive for the industry to cut its emissions. However, I have just learned that coal-fired electricity producers will be lobbying the Federal Government for free permits to pollute. Um… does this not defeat the purpose of having emissions trading?
Handing out free permits to coal-fired electricity producers is like exempting armed robbers from a firearms buy-back scheme. It’s called “grandfathering”: protecting certain individuals or groups by giving them a free ride. The European emissions trading scheme has been justly criticised for giving major polluting industries free permits – this allowed them to continue with business as usual and in some cases, even cash in on an over-allocation of permits by selling the excess through the scheme.
The only reason the coal industry would suffer financially from an emissions trading scheme is if it failed to see the writing on the wall. Climate change necessitates a rapid reduction in greenhouse gas emissions and the coal industry should plan for business in a carbon-constrained economy. Investing in renewable energy and energy efficiency would be a welcome start.
Australia needs to cut its greenhouse pollution by at least 40% below 1990 levels by the year 2020 and then get to zero emissions as quickly as possible after that. With half of our emissions coming from producing electricity, this means moving away from coal-fired power towards renewable energy. An emissions trading scheme is one way in which greenhouse pollution can be regulated and reduced but if the coal industry is given a free ride, all this discussion, debate and extra bureaucracy will be for naught. The coal industry is one of the main reasons why we consider emissions trading!
