Climate Action Network Australia (CANA) is a non-profit alliance of over 35 Australian organisations working to fight global warming.

Formed in 1998, CANA is the Australian branch of the global Climate Action Network, which has over 333 members in 88 nations.

Australia's Approach

Australia: Background

• Highest emissions per capita

• Federal Government = Coalition of Liberal and National (right wing)
• NOT Party to Kyoto Protocol
• Federal Government has said NO to emissions trading

• Labor (left wing) hold all 7 state governments
• NSW mandatory emissions trading since 1st Jan 2003
• Coalition of state governments discussing implementing national emissions trading

• “National” Electricity Market = East Coast market across states where electricity is traded.

• In NSW most electricity provided by 3 government owned corporations – Energy Australia, Integral Energy and Country Energy.

NSW Greenhouse Gas Abatement Scheme

• Commenced in current form on 1st January 2003

• Requires NSW electricity retailers and other liable parties to meet mandatory targets for reducing greenhouse emissions resulting from the electricity they supply or use.

• Or pay penalty of $10.50/tCO2e

• NSW Greenhouse Gas Abatement Certificates (NGACs) created through certified generation demand side abatement and sequestration
• Ambitious attempt to reduce emissions associated with electricity

• Complex design
• Baseline and credit
• Poor transparency
• Estimated high transaction costs
• Low additionality
  

• The parameters of the scheme (cap) based on a business as usual calculation and on a per capita basis.  As the population of NSW grows, so too do emissions

• Baseline and credit schemes always complex
• Require an estimate of what would have happened
• Credits are an estimate of emissions reductions – sometimes imperfect estimate

• Very low transparency
• Most information commercial in confidence
• No requirement for participants to report publicly
• Government (IPART) report on scheme had very little detail and no assessment of performance against the intent of scheme (reducing greenhouse gas emissions)
• The remainder of this presentation is based on an independent search through the 2003 NGAC registry by NSW University's Centre for Energy and Environment Markets.
• No rules on additionality
• Against other government programs
• Against business as usual
• Conservative estimations suggest that 70% or more of all NGACs created may not be additional abatement.

• Australian Greenhouse Office estimate of NGAS Gross Abatement for 2010

• Heavy market concentration

• NSW Greenhouse Emissions

CAN Australia ET Position

• Must be part of broad policy response

• Must be cap and trade, with cap set to achieve deep cuts.

• Permits auctioned, not allocated

• Must be transparent

Why Are Australia's Emissions High?

Second – we need renewables

• Half of Australia's emissions come from producing electricity
• 8% renewable, 77% coal

• The EU uses 50% more renewables and energy efficiency and 50% more gas than Aust.

Third – we need to join the rest of the world