This piece was originally published in today’s Crikey email.
In the coming months before the emissions trading legislation comes before the Senate, the Rudd Government needs to think hard about what it is trying to achieve.
Does it plan to buy into the lowest common denominator populism of the Coalition? This approach drags the debate backwards, undermines the global climate fight, and risks alienating a significant portion of Labor’s own base who voted for leadership on climate.
Or will it lead from the front, inspiring Australians to embrace this challenge to rebuild, upgrade and retool for a zero emissions future? Will it appeal to people’s best instincts, articulating a positive vision of preparing ourselves for the future by investing in a systemic roll-out of energy efficiency, mass transit and renewable energy?
The final answer will be in the 2020 target that is promised in the legislation by the end of the year, but the signals from yesterday’s Green Paper were decidedly worrying. The Paper was framed entirely around costs and cash compensation instead of the opportunities for transformation we Greens have been advocating.
The Canberra insider view, surprisingly articulated even by the eminently sensible Bernard Keane last week, is that, while the Greens position makes perfect sense, it is politically unacceptable and won’t pass muster with the electorate. This is a leftover from the Howard years where good policy was abandoned in favour of pandering to special interests and appealing to base populism was seen as effective politics.
I don’t believe that that is the case anymore. The Canberra insiders are completely misreading the level of anxiety in the community about the science of climate change and the awareness that, if we don’t act now, there will be nothing that we can do to avoid runaway climate change when the politicians finally wake up.
All around the country, I and my colleagues are accosted by people demanding to know what we are going to do to help them reduce their emissions. Why isn’t the Government helping them install insulation and solar water heating, they want to know. Why isn’t the Government embracing the smart, baseload solar technologies that we are exporting to the US and Spain? What are the Greens going to do about it? They feel that hading out cash compensation while doing nothing to bring on alternatives is cruelly setting them up for a fall when the crunch comes.
Voters were outraged by the capturing of the Howard Govt by the greenhouse mafia. They will be equally outraged by the Rudd Government’s capture and storage in the pockets of the coal sector. This is the one and only case where I am hoping for leakage!
Emissions trading is supposed to go hand in hand with a suite of measures to unleash creativity and innovation and stimulate investment in the zero emissions alternatives. Instead, we have every mechanism imaginable to protect existing investments. The Green Paper even proposes free permits and cash handouts to protect investment in coal generators. This will deaden any stimulus to invest in the much-needed new infrastructure for renewables and energy efficiency.
Just as with increasing the price of petrol with one hand and decreasing it by the same amount with the other, the Government has put its foot on the brake and accelerator at the same time. The wheels are spinning madly, we’re burning up fuel, and we’re going precisely nowhere.
Prime Minister Rudd and Minister Wong would do well to read Nelson Mandela’s first lesson of leadership, in last week’s Time Magazine: “courage is not the absence of fear, but the ability to inspire people to move beyond fear.”
Rudd and Wong are so paralysed by fear that, for all their talk of transformation, they are clinging to the past. The community has moved well past the Government towards the Greens position, opening the field for courageous leadership.
Rudd and Wong would do well to consider this before bringing legislation before the Senate that gets the support of the Coalition but loses the community.
The E&O-TS is a much better name for it Christine. Errors and omissions included in a fearful attempt to avoid liability.
[...] Senator Christine Milne wrote a piece for Crikey today, in which she argues that the Government has underestimated the public’s willingness to accept what is needed to truly address climate change and failed to show the leadership needed to honestly set out what must be done. [...]
The government has decided they are going the emissions permits trading route and we may as well accept that is the framework. The thing is to make the best we can of it because it actually does not matter much how we collect money when people emit greenhouse gases. What matters is HOW we spend the money.
We have been promoting an idea called Energy Rewards for a couple of years now and perhaps now is the time that it might catch the imagination of the people.
The essential idea is to collect some money when people pollute but to give the money to the population for behaviour that shows that they are doing something about reducing emissions. It might something as simple as your household electricity consumption is below average or it might be that you ride public transport or it might be that you close down your carbon emitting coal fired power station.
The key part however is that you must spend your Energy Rewards on INFRASTRUCTURE that will reduce carbon emissions. It might be a solar hot water heater, it might be buying a share in a geothermal power plant - whatever you choose as long as it is infrastructure and it will reduce emissions
The trick is to set up the system so it is fair and is difficult to rort. Luckily this is simple provided you make it all voluntary. There would be NO cost to the government in setting up such a distribution system. We have devised a way that it can be done with little or no regulation and best of all it can start tomorrow. There is no need to “design” a whole new set of property rights.
[...] Ms McCaughey’s comments came just hours after the federal government released its Emissions Trading Green Paper, a document fraught with problems and mixed-messages. She, like the Greens Council Candidates, expressed concern that the initiative simply won’t send a signal for change. [...]
“increasing the price of petrol with one hand and decreasing it by the same amount with the other”
This kind of policy shows complete and utter ignorance of markets.
http://en.wikipedia.org/wiki/Supply_and_demand
Without a change in the price, behaviour will not change. It is just a complex form of taxing and handing back and will have the same effects as if nothing has happened. Investment will be held off, people will still demand in three years what they demand today (i.e. petrol for 1c/L) and the only difference will be that another federal election will have passed by.
Looking at things from the “what can be done better?” side, in terms of building out renewables there’s an interesting paper here which looks at getting renewables to 50-90% of total generation in the US by 2020 - more ambitious than any plan I’ve heard of in Australia.
He doesn’t include possible growth in demand from normal factors and from converting away from fossil fuel use, but it’s an interesting piece nonetheless. Something for the Greens to toss out the next time some drongo tells them “but it’s not possible!”
Correction, wrong link, the correct one is - Gore sets goal of 100% carbon-free electricity by 2020. I’m happy for Tim to edit my post to put the right link in ;)
The Greens have an opportunity here to expose both the Labor and Liberal parties. Simply DONT pass this in the senate. Just watch the Libs clamber over themselves to get this through. The Greens should advocate a carbon tax to be applied as the fossil fuel is extracted from the earth. This would be easier to implement and also to police because the scheme as proposed will foster an amazing amount of innovation on how to cheat it.
Rob,
There are good reasons to apply a carbon price on fossil fuels as they are extracted, such as the fact that coal exports would be liable. Coal exports seem to be the thing that politicians and policy makers don’t like to talk about for some reason. Unfortunately fossil fuels don’t count for all emissions, there are also things like agriculture, deforestation, forest degradation, and cement production. It may be better to apply a carbon price to both domestic emissions and exports of goods that will be cause additional emissions (e.g. coal).
You are absolutely right - at the moment there is a huge perverse incentive for firms to emit more than 1500 tonnes carbon dioxide equivalent per million dollars of revenue.
At the moment the level of the cap will not be released until October, when treasury modelling will be released. The level of the cap is crucial, and just as important as the framework outlined in the Green Paper. It is hard to see how this will play out, although I suspect that people in Treasury will be less sympathetic to rent seekers than the people in charge of the Department of Climate Change.
I suggest the posters to this should perhaps read some of this!
http://nzclimatescience.net/index.php
While I’m in no way saying believe it, but read it, and wonder “the way back” from promulgating the the efficacy of promoting GW!
fluff
What am I meant to get out of that website?
It’s just a whole lot of cobbled together articles which don’t attempt to follow any scientific process at all with added headlines which distort the reader’s prior knowledge.
But Austin, it has such a great name!
Plus it’s seems so impartial. I was very taken with this headline - “To help non-scientist visitors: LAYMAN’S GUIDE TO “GLOBAL WARMING” HOAX”.
Just hard to impress some people I guess.
All fluff and no substance ……………….. sorry frank luff, but you really did leave yourself open for that one.
I really do like the Mark Twain quote on page one though. Yes he was a sceptic, but he also had a brain. Not that I am implying that climate change sceptics don’t have brains, but any site that posts articles by Andrew Bolt, as an authority on climate change science, must be severely discounted.
The problem with sites like the one fluff identified is that we can be sure that less discriminating readers will buy the message. Only a tiny percentage of the population has scientific training necessary to properly critically examine the site.
Genuine scientists can and probably should be legitimately critical of emotive campaigns which claim science as their bedrock. The deniers will sieze on such critical statements as sign of dissent, regardless of the true opinions of the scientist.
This suggests the popular support for climate change response could be quite fragile. My guess is that right now the broad support for climate change response is like a fad. Many people support it simply because lots of other people support it. Many of those who now say they support a response will not actually understand the issue very well at all.
If the popular tide turns then all the actions predicated simply on climate change may be derailed. It would be foolish to imagine their won’t be a backlash, we are already seeing the early signs of one.
The existence of increasingly sophisticated sites like nzclimatescience mean we need to give the general public more reasons than climate change science in order to help them stay the course during the difficult hours that lie ahead.
We can appeal to two things.
The first is a built in human psychological aversion to risking free rider punishment. Whether climate change is likely or not, its clear that other nations fear it, and so we risk sanctions from them if we thumb our nose at the risk by emitting more than our per capita fair share. This is the key reason why people felt good about signing Kyoto. This is something John Howard deeply misunderstood. We just felt more vulnerable outside the Kyoto club than inside it.
The second reason is that the climate change response promises inflation resistant future energy security.
Both these two things are motivators for response, even for a person who feels the climate change fears are overblown.
I wouldn’t be so sure about that, Griffin. People can spot bollocks. Well, uneducated people can, as Monbiot recently observed in an article,
“On almost every other weighty issue, the professional classes appear to be better informed than the rest of the population. On global warming the reverse seems to be true. The only people I have met over the past few years who haven’t the faintest idea what manmade climate change is or how it is caused are university graduates.”
It’s very strange, but matches my experience. I work in kitchens and have worked in factories and the Army, and except for the 17 year old waitresses, everyone else is well aware of climate change and peak oil - not all the crunchy details, but they have the gist of it. But I also meet schoolteachers, IT professionals and engineers, and they have no idea.
I don’t think you need a BSc to spot bollocks.
Kiashu there is a handy explanation for what you and Monbiot observe and it is the opposite of what you imagine. The professional classes have two reasons to dismiss climate change:
a) Firstly they are better trained at being skeptical of various claims, they know not to believe everything they read, or see on television.
b) Secondly climate change risk means we need to change the status quo, and the status quo favour the professional classes, so they will happily invoke their tendency towards skepticism of this thing that threatens the world which suits them.
On the other hand it is entirely plausible that the less trained are frankly more gullible. They are much more prepared to believe what they see on TV. What’s more if they perceive a threat to the status quo then they are more likely to embrace it, since it presents the opportunity of being a leveller by unwinding the paradigm which sees them presently disadvantaged.
Once the media siezes an issue (as it has with climate change) then the less trained will readily buy into it and the more highly trained resist especially given the threat the highly trained percieve in it.
So now we have two possibilities, your explanation that the untrained are more perceptive and intellectually discerning than the highly educated, or my explanation which is the polar opposite of yours. For the moment the result is the same.
However the critical thing is what happens when the pain of climate change discipline bites (decades before the severe justifying climate consequences arrive). With my explanation for what you observe comes the risk of a popular backlash against the deprivation to the current generation and thus the unwinding of the effort to protect the future. Because the buy in is fad like devotion to pet media issues, the media can take it away when it wants to sell more advertising, or when it senses the public is bored with the issue. And then the house of cards tumbles down.
And that dear Kiashu is the whole point of my argument in 14. That is we need to innoculate ourselves against this backlash risk by building an unbreakable argument for decarbonisation.
The thing I find most odd is your confidence that we shouldn’t even feel the need to bother to build a solid case for the cause. Why are you so cavalier about this?
Some interesting views above, but I believe that no matter what type of carbon trading system is implemented, the following will happen:
a. Increased businessess migrate to countries that do not have a carbon tax (eg. India, China), and the loss of jobs in Australia (remember a factory worker cannot be retrained to be an environmental scientist).
b. Australian business that remain will need to pass all the increased costs direct to the consumer.
c. The wealthy will just sigh, and pay any increases.
d. The Governments will have to subsidise the low income earners who will never be able to afford to new technology installations (besides most rent, and if landlords install, rents will go through the roof), else there will be riots in the streets (remember that low income earners include the working poor, welfare recipiants, pensioners (Gov and Self Funded)), and these numbers will increase as business sheds staff.
e. Middle income earners will bear the majority of the cost increases, and are likely to throw out the instigators of the system at the 1st opportunity.
f. Interest rates and rents will continue to increase as increased costs push up inflation.
Sorry people, but I agree with a few comments above that suggest the majority of supporters of the carbon trading systems wil only remain as long as they are not directly hurt. Wait until a family cannot afford to buy the necessities in life due to increases caused by environmental who have pushed prices to unpayable levels.
One thing for sure is that, I am a retired baby boomer who does not have the funds to implement any new technologies, so will just have to limp along reducing spending as necessary, and wait for the Feds to subsidise my energy bills.
What I can also see happening is that the Federal Government will instigate a scheme in say, 2010, with a rollout term of 3 years, then as time goes by, and people / the economy start to hurt (maybe badly), the Government will change the roll out to run for 10 - 15 years (political necessity).
I agree to a certain extent with Grant, his prophesies seem realistic.
I have written on many blogs that there is no way we can deal with climate change or any other aspect of the ecological crisis without major pain and major structural change to the economy. I have often been told on these blogs, including by Greens, that we can deal with climate change within our current economic frameworks and that the economic opportunities of green industries will fill the economic vacuum where carbon intensive industries used to be. But I still reckon this is escapist crap.
Until we keep coal in the ground there is nothing realistic Australia can do to reduce warming. Keeping coal in the ground means the collapse of the export economy as well as local industry and this is just unthinkable - as reflected in both Garnaut and Wongs strategic directions. The myth of clean coal emerging at some future stage is the only legitimisation of the current responses based on affluence as usual.
This is not just a matter of re-engineering industry and energy modes but also basic questions of the distribution of wealth in society. As Grant correctly points out, the pain of the emissions cap will not be felt by the richest in society, in fact they are being given all sorts of exemptions and incentives to pollute in order to maintain their businesses; it is the poorest who will pay the cost. This is the case in Australia as indicated by Grant but it is also the case internationally as the big polluting corporations get world bank support through such things as carbon trading as well as the usual loans system to build energy and industry infrastructure in the third world - rather than the third world using carbon credits for economic development which they are demanding but being ignored in united nations climate change processes. Australia’s aggresive loyalty to the U.S. and world bank priorities at Bali and our role in sabotaging the third world perspectives at that conference is a glimpse of how this whole scheme will unfold internationally.
It seems to me the future will go in one of two directions 1/ Economic collapse through treating climate change seriously including a global zero emmissions target in the next few decades or 2/ economic collapse through not taking cllimate change seriously, such as the present ETS proposal and what looks like an inability in most of the rest of the world to act.
In either case, questions of how will the poor survive (or will they survive) need to be on the agenda too, not just arguing about various inadequate scientific models of climate action.
The Greens have always said they were not a single issue party and that they are committed to social justice. I believe this aspect has been missing in the climate debate - including from the Greens.
Strange there is never any discussions about what kind of jobs/wealth will be created from low carbon emission economic opportunities.
I know it is easy to think in terms of the past, but the you cannot state that there will be few jobs in a future with low emissions without any evidence. In fact, there is plenty of evidence to show that there are heaps of entrepreneurs out there who can use the skills that people have today in low emission technologies if given the chance.
And this garbage about overall increased costs. Inflation is targeted between 2 and 3 percent (in Australia). No matter how fast scarcity increases we can remove money from the economy at a rate which keeps prices within that target range. The people who will suffer are those who have to borrow for future investment. That is, we will need to use our current technologies wisely if we wish to maintain low costs of money. The is exactly why trying to reduce Australia’s emissions with nuclear power and CSS is crazy. That is a future investment as we have no capacity in these technologies at all with today’s assets.
However, we do have the ability to build solar panels, wind turbines, water turbines and a wide range of proven ideas including energy efficiency that with the proper signal will be online quicker than any of those grandiose alternatives.
And about industries going offshore, great. We don’t need them for our future. Demand in developing countries follow the demand of developed countries (that is, they are catching up). So these fundamentally emission intensive corporations will find more profit elsewhere, but not in the long term and will eventually find themselves in dark corners. This has occurred in the past for things that were traded that we shun in today’s (e.g. slavery, but there are far worse examples).
There is no easy solution (easy meaning doing nothing in this context), but the thinking in above comments is fairly ignorant of what society knows about economic development.
Futher to Austin’s comments @ 19, listening to Alan Jones of the London Climate Change Agency this morning, moving to ‘greener’ and decentralised power in Woking U.K. saves the council 1.2 million pounds a year in power costs (80% reduction in energy consumption).
BUT importantly this was at an upfront capital cost of 250,000 pounds, AND jobs were created in the process, AND the cost of electricity went down, AND social justice?? A 120 to 200 pound saving per annum on a households power bill! Now that’s what I call a return on investment!
So please Grant @ 17, stop all the Furphy’s about increases in costs, loss of jobs, and John Tracey @18 reduced social justice by pursuing ‘green’ power. Economic and social collapse need not happen, and there are working towns/examples that prove it!
Furthermore due Australia’s distances, Alan claims the savings will be greater than those of the UK, not less, as our transmission losses are higher. The power industries that see these energy savings as a threat to business as usual, will go the way of the dinosaur, but industries with a different mind set will profit - big time, and so will all Australians.
This is an overview of Woking and Alan Jones http://www.guardian.co.uk/society/2005/jun/29/environment.interviews
and these are the figures for Woking pop. 100,000 (read them and weep for what we could have started in the 1990’s):
Summary of Energy,
Environmental and Financial Savings
1 April 1991 to 31 March 2004
Energy Consumption Savings 244,408,155 kWh 48.6% saving
Carbon Dioxide CO2 Emission Savings 142,013 Tonnes 77.4% saving
Nitrogen Oxides NOX Emission Savings 439.0 Tonnes 76.6% saving
Sulphur Dioxide SO2 Emission Savings 1,480.84 Tonnes 90.9% saving
Water Consumption Savings 412,855,000 Litres 43.8% saving
Savings in Energy and Water Budgets £5,388,721 31.36% saving
Notes:
• The Council’s target was to reduce energy consumption by 40% within 10 years from 1991/92 to 2000/01.
• The above savings are for corporate property and housing stock, where the Council pays the energy and water bills, and exclude Council tenant and private sector savings achieved by the Housing Energy Efficiency and Sustainable Energy Programmes.
Climate Change Strategy
for Woking
1 April 1991 to 31 March 2004
Reduction of CO2 Equivalent Emissions 17.23% saving
Electrical and Thermal Energy from Sustainable Sources 97.7%
Notes:
1. Woking’s Environmental Footprint - 1,060,000 tonnes of CO2 equivalent emissions at 1990 levels.
2. Target to reduce CO2 equivalent emissions by 80% from 1990 levels by 2090 RCEP target.
3. Council targets to purchase 100% of its own electrical and thermal energy from local sustainable sources and 20% of its own electrical energy from local renewable sources
The above savings, and benefits, will also be greater in Australia due to our needs for Tri-generation (power-heat-cooling).
Most importantly for Australia he says, “You don’t get a energy and carbon emissions reduction by trading it, you get a reduction by doing something”. The trading system will not reduce energy consumption or CO2e emissions, only the proposed and ill-defined, dare I say “rubbery”, cap will do that.
The good news is that Alan is replicating the Woking results in London which is 75 times the size, and is in Australia calling on Sydney to do likewise and be an example in our region.
I strongly urge the Australian Greens not to be diverted by the carbon trading scheme, that they renew their calls for the “doing” of energy emissions reduction, and they not support the parasitic and emasculated “trading” option as proposed by Labor.
I did not put that smiley in my post! Bloody annoying that I can’t edit it out too. Please turn the auto smiley’s off.
McFarm,
Please do not caracature my position as “reduced social justice by pursuing ‘green’ power”.
The reduced social justice comes through pursuing and protecting corporate profits.
The truth is, what ever the carbon plan is, somebody has to pay - and it is either the consumer or the big corporations. If the consumer pays, then the poorest in society suffer the most.
The corporations will not pay without a sustained political battle which they will avoid by relocating to some secure, cheap and ecologically dirty dictatorship somewhere else to maintain their profits and emissions.
I agree with Austin - good riddance to them, but if they just move their pollution we have achieved nothing for the environment.
If we do not plan for a more nationalised and self sufficient economy then our present economy will collapse with the exodus of foreign capital.
To really attempt to create a dissincentive for the coal industry, we need to create an alternative economic base - not just for ourself but also for the poor and developing nations such as self sufficient energy so they wont be dependent on the big corporations centralised and polluting systems.
Green power is essential to social justice, not just in terms of the nature of the technology (eg wind, solar) but also in the social mode of the technology, e.g decentralised self sufficient energy modes. - especially in the third world. However the third world and developing countries are being offered centralised nuclear and “clean coal” technologies that will entrench the domination of these big corporations over the poor communities that they continue to suck wealth from.
What we have with the Rudd/Wong and UN and World bank plan is not a process of developing green energy, unless you consider nukes and the myth of clean coal to be green energy. It is a process for the maintainance of centralised monopoly control over energy and therefore the economy.
The UK example is perhaps not so relevant to here as they no longer have cheap coal as we do. A better example would be the magnificent plan to make Cloncurry in N.W. Qld. totally emmision free for electricity. However, Cloncurry’s main industry is mining including coal mining. So while the coal miners might enjoy solar hot water and electricity in their homes, the economy still demands massive carbon emmissions through the mining itself as well as the stuff being burnt in Australia and overseas. The other big industry in Cloncurry is cattle. While the farmer may have clean green energy running the freezer and washing machine, the cattle still keep on farting.
Only major social and economic change can deal with climate change. Only social and economic change can deal with local and global poverty.
And Austin,
you said…” No matter how fast scarcity increases we can remove money from the economy at a rate which keeps prices within that target range. ”
What are the mechanisms for doing this and how does it affect the poor?
Also, what are the implications of the global credit crisis on our capacity to adapt to scarcity through the mechanisms you suggest?
At present the reserve bank does it through interest rates which has driven up housing and grocery prices causing great suffering in a rapidly expanding underclass. Now it seems electricity prices are going to go up too - and leaving our shores to go to the multinational energy and mining corporations, so I guess that is another way to remove money from the economy and fight inflation in a time of scarcity?
One of the myths put by the big corporations is that imposing a carbon cost will scare away foreign investment.
There is an excellent case instead that the reverse is true. Properly imposing a carbon cost can (if not corrupted) encourage clean generation which will attract foreign investment on two levels. Firstly to fund construction of clean generation and secondly to develop industries which are users of that clean generation.
Australia will one day have the world cheapest power. This will happen because we have the worlds most abundant, and cost effective renewable potential. Foreign capital will obviously be attracted like bees to honey to access this clean cheap power.
It is critical that all politicians understand this so that the misinformation from the fossil fuel industry on this point is ended. Can the Greens senators please explain this to the other pollies?
Some old dirty industries will feel some pain, but this is a vital and necessary case of creative destruction which allows new and better things to emerge. Propping up an industry which has no place in our future offers no satisfactory return on investment.
Sorry John, it was not meant to antagonistic, I am just frustrate by the lack of vision and leadership by the tired old parties, and also worry that the Greens are being side tracked by a superfluous trading system. That said I hardly think the Greens are the party that will be “pursuing and protecting corporate profits”, do you?
But if the version of energy and carbon reduction, as presented by Alan Jones and the Woking example, means lower energy bills for all, where is the lack of social justice?
As for dismissing the UK example because of “our cheap coal”, I thought coal was a globally traded commodity and we paid world parity prices for our own coal? I could be wrong about that, but price doesn’t stop the Chinese and others form using our cheap coal - unfortunately.
“Only major social and economic change can deal with climate change.” True, and change can be positive. Your premise is that change will be painful and that there will be winners and losers. The Woking example is proof positive that change can be a win for all, including the poorest of our society. Bring it on I say.
“What are the mechanisms for doing this and how does it affect the poor? ”
http://www.rba.gov.au/MarketOperations/Domestic/open_market_operations.html
Two moderate sized words… repurchase agreements.
If you choose to read this document just remember that when the RBA “debit” and “credit” escrow accounts, they don’t actually have another account to credit or debit accordingly. The values are just increased and decreased and in other words money is just created and destroyed.
As I said, it only really affects future purchasing. That is people who want stuff in the future and hence borrow today to do it (i.e. the cost of money)
If poor people want to borrow finance to survive into the future then it would become more expensive. If they have the opportunity for meaningful secure employment in which they are given a _fair_ share of the profit margin then the amount of money is pretty much irrelevant because of the inflation targeting. If the policy continues we will know that prices will be kept steady in that range and hence will have a good idea as to what to expect into the future.
And remember prices of assets are determined by supply _and_ demand, not just interest rates alone. Our country seems to have leaders which want to spur on demand at all costs for everything. Say for example, real estate investments. Which has the drastic effect of making it almost impossible for people to have security of ownership of their family or first home. Which is why the demand for rentals is so high. Which is why demand for investment properties is so high. (and so it goes). Hence prices are just stupidly high. Supply does have a role to play, but so does demand.
High interest rates tend to affect middle/upper class people more as they cannot spend like there is no tomorrow. It also affects businesses as they cannot spend money in anything they like to increase profit; they have to think harder as to how to organise themselves.
I’ve typed just about enough.
Moderators, may I suggest this blog/the Greens needs a Carbon Myth Busters section. Above contains commonly held misconceptions about the pain, losses, cost/benefits and ROI’s etcetera, of a move to a low carbon economy. Granted there can be pain and loss, but it ain’t necessarily so.
It would be helpful if there were an area, or perhaps a link to a site, that tackled this misinformation. Perhaps someone has a link to such a site that is in plain English and eschews jargonese?
I agree with mcfarm’s call. It’s not too much trouble to put up a static page outlining what is involved with a decent ETS. Environmental Economics (an American blog, but very good) has a page on Carbon Tax vs. Cap and Trade under their Environmental Economics 101 section.
Synthesising the env-econ information with Greens policy and Christine Milne’s Crikey articles would go a long way to giving the Greens a page outlining the economics of a move to a low carbon economy.
Australia’s strength in a post-carbon world is the quality of our renewable potential.
Our present weakness is dependance on fossil energy.
We should be playing to our strength and eliminating our weakness.
mcfarm and Sam, we are in the process of building a new website, as discussed previously here, which is planned to go live in about a month. You can be sure that such a page is part of the plan and in development as we speak.
McFarm,
While you may disagree with what I and others say, please do not caracature what you disagree with as myth.
And I did not say “the Greens are the party that will be “pursuing and protecting corporate profits”.
What I did say was “I believe this aspect (social justice) has been missing in the climate debate - including from the Greens.
I have just been looking at the climate change policy and while it has a number of brief platitudes about social justice, there is no policy framework at all as there is on the technical aspects of the debate. This is important for Australia but is especially important for international efforts. The World Bank is in control of the whole agenda of transfering technology and carbon credit to the third world and developing nations, a plan created and supported by the rich world including Australia and in direct opposition to the stated will of the third world and developing nations on this matter.
And Austin,
The reserve bank is a non-elected group of bankers and corporate executives making up the most powerful entity in Australia, with no accountability to government at all for its decisions about the economy, and it has an inherent bias to maintain profits of banks and corporations. Questions of unemployment and unaffordable housing are just collaterall damage to protect the profits of the elite.
And you said…”High interest rates tend to affect middle/upper class people more as they cannot spend like there is no tomorrow. It also affects businesses as they cannot spend money in anything they like to increase profit”
Although this is very sad for the middle/upper class people and business, what is the flow on effect of this to the poor? - jobs and prices?
John, I used ‘Myth Busters’ as popular culture shorthand for disprovable postulates and theories, or, if you prefer, to say that there is an alternate possible reality to the negative one the press and business in Australia has latched onto.
No personal offence or caricature was intended, and perhaps some skin thickening is in order, as the ‘Carbon Myth Busters’ was addressed to the moderators about the need to counter ‘there will be pain’ mentality that seems all pervasive. In other words, it wasn’t about you.
That is not to say that increased social injustice may not be a result of an ill conceived and executed carbon trading/reduction, because ‘collateral damage’ is definitely possible, both nationally and internationally. I for one intend to fight vociferously agin this possibility and, in this regard at least, I suspect we are singing from the same song book - perhaps not from the same page though.
Tim @ 29, great! Will await with interest.
McFarm,
you said….” Above contains commonly held misconceptions about……….”. Forgive me if I have misinterpreted this to include my opinion.
One of the myths to be busted on the myth buster page is the myth that we can undo the ecological damage to the point of surviving even another century without radical change to our lifestyle, economy and sociology. It is a myth to consider such change could occur without pain. Either the rich share in this pain or the poor, already in pain, continue to die at escalating rates.
This is not just about public transport and solar panels. It is about a dysfunctional mode of industry and agriculture and trade that has just about exhausted itself ecologically on so many fronts, even without climate change. We are an evolutionary departure from sustainable modes of humanity to an inherently cancerous and self destructive mode, betraying the millions of years of our previous evolution.
We have never lived this way before but for some reason it is unthinkable to consider that we might live any other way.
We have seen the phenomenon of denialism very strongly with the likes of Andrew Bolt and sections of both the ALP and Lib/Nats when it come to climate science - clinging to a confortable belief that it is not that bad.
But it is no less denialism to belittle the scale of the problem to something that can be dealt with by a few painless adjustments and tinkering with present paradigms. This is the spiritual base of the clean coal myth.
Until the banks and energy companies can be convinced to release their massive profits, a very difficult political process that will not be facilitated by the marketplace that they control, or by the reserve bank, world bank and IMF who are in control of the global carbon trading project, then we will have absolutely no chance of even stabilising global emmissions, let alone reducing them, let alone reducing them by any relevant or significant amount. To pretend otherwise is head in the sand denialism every bit as bad as Bolt.
Re #27,
I hope that when the website is up, the explanation of cap-and-trade vs a carbon tax is better than the one on the Environmental Economics site. The main example on the Environmental Economics site is of a specific form of cap-and-trade where all permits are handed out for free. They can also be auctioned. The main issue to do with a choice of carbon tax vs cap-and-trade is to do with uncertainty, I was disappointed that the site did not discuss uncertainty. Without uncertainty you could choose the tax to cap emissions at a certain level or vice-versa. The point is that you cant do this precisely.
These issues are described better in Weitzman (1974) Prices vs Quantities, or Hepburn (2006) Regulation by Prices, Quantities or both: a review of instrument choice. It is also possible to have both cap-and-trade and a carbon tax, without much extra complexity. This is a bit like having an ETS with a price floor, see here.
John Tracey,
“It is a myth to consider such change could occur without pain.” Perhaps, but if the changes occur incrementally, we will be like frogs in cold water being brought to the boil, we won’t object to the changes or even notice “the pain” of being boiled alive - or perhaps this analogy is a little too Machiavellian for a Greens blog?
But back to the Woking example, where was the pain of change there? The changes were huge. When did the hip pocket nerves hurt? Basically there was no pain: not for council, not for rate payers, not for energy users. All were better off financially due to the changes, and the environment benefited greatly too. So why aren’t we all doing this? Perhaps it is denialism to ignore this example?
The thing about the Woking example is that it was all done at local council level. This bypasses the world bank and IMF, and even a carbon trading system. It also bypasses the need for the releasing of corporate profits, as Woking created their own profits which were reinvested back into the community. This was a local communities ‘doing’, and if these examples are held up as shinning and doable, more will follow. At some point critical mass will be reached and a massive paradigm shift happens willingly, and seemingly overnight. You may call this idealistic and naive, but what are the alternatives, are they ‘doable’, and where are the successful working examples of these alternatives?
I don’t believe it is realistic to expect the IMF, or the world bank, or the reserve bank to change. Neither is it realistic to expect to ‘convince’ private banks and companies to release their ‘massive profits’ for the common good. What is there incentive to change? So bypassing them seems obvious.
As for the third world, if the IMF and world bank are bypassed by communities, once critical mass is reached they lose the power to bend these countries to their ‘free market’ and economically rational will. And btw which would be easier and more ‘doable’, legally bypassing the system, or convincing the system to change when it has a vested interest in not doing so?
So having not pretended otherwise, but having given a working example of how it has actually been done, and could be done on a much larger scale, perhaps I should be offended at being compared to Bolt?
It’s all very well to cry ‘havoc’ in a time of war, but where are your dogs - your constructive/working examples of potential solutions?
Mcfarm,
I do not give your critical mass theory much of a chance to succeed before economic and ecological collapse forces us out of desperation to change.
However, as far as I can see, something along the lines you suggest is the only possible hope for a realistic response to the crises. As far as I can see, a mass boycott of polluting industry is the only real way to affect the behaviour of the banks and energy companies.
It seems to me that the highest priority for those of us who want to engage in realistic change (rather than feel good tokenism) is to envision and articulate and organise the process to build a critical mass outside of the banks’ frameworks. Yet I see none of this in Greens policy which is totally within the expectation of affluence as usual rather than major structural change.
As for… “where are your dogs - your constructive/working examples of potential solutions?” I am a bit old fashioned in this regard. When I was young I got inspired by wind and solar power. The hippies of the time reckoned we could control the system ourselves including maintaining it so we could break free of the polluting energy companies. Although in these days of feed-in tarriffs and anything less than “base-load” is considered useless, this issue of political and economic self sufficiency has been largely buried in the big mega-fix modes to the whole energy debate.
But I reckon hippie self sufficiency, small is beautifull, appropriate technology etc. is the solution to global poverty and provides (as Shumaker preached) a spiritual value and economy to replace the materialist consumerist economy of the affluent world.
That where my dogs are.
If self sufficient eco-village development can become trendy on the Australian real estate market, why can’t this model be the basis of development in the poor and developing world (including Aboriginal Australia)? The world bank specifically discourages (a euphamism) this mode of economy.
I have not heard the Greens challenge the total control of the international carbon trading, including reforestation and conservation programs, by the world bank, a point being strongly protested about by the poor nations who want to resist further imperialism and colonisation through the process.
This is turning into a interesting discussion with many points of view, and prophesies, however Australia is a democratic country, where the Federal Government of the day is beholding to the majority wishes, or it is out of a job. If any Government instigates change that is perceived to hurt the masses, or move too fast with change, then the masses will hurt the Government (eg. Labor 1975)
There is no doubt that we all need to rethink how we consume energy, and I suspect from figures I have seen, that energy consumption is generally reducing. However I believe there is a fine line between reducing energy usage by consensus, and forcing people to escalate their reduction of energy usage by force (ie. potentially inflicting a lot of pain).
One of the previous commentators made the comment that, good riddance to dirty companies if the move off shore, but who is going to provide new employment to the 10s of thousands of employees who are out of jobs. Are these people to be just classified as casualties of change, and left to their own devices. Remember, that although new industries will obviously be created, the skill bases will be dramatically different from what is currently utilised. If they are to be left to their own devices, we had all better prepare for major crime increases.
Maybe a taste of what is to come, is the current transport operator trouble. The truckies are suffering pain with the increased cost of diesel fuel, with many owner operators unable to pay their bills due to increased costs. Over the past couple of days the truckies have caused disruption in each east coast capital city, and if the Feds do not assist them to reduce their fuel costs, they are planning to blockade each city, effectively shutting down all deliveries to the capital cities (food, milk, other necessities etc.). If this happens, watch the prices go out through the roof.
I am sorry people, but if the Federal Government, does not want major social upheaval, with the resultant damage to the economy, then they need to move forward in a slow steady pace, allowing Mr and Mrs Average, and the companies they work for, to adjust to change over a period of time (possibly a time line of 10 to 20 years). Moving forward also needs to be through consensus, with appropriate incentives for all levels of society.
Do you live on a small farm? Is there something on your farm that you never thought of using to make extra income? Well, I am going to give you some ideas on how to take your small farm and monetize it. Here are a few examples of how I make money on my farm. After reading this article, I have no doubt that you will be making extra income from something that you enjoy doing.
Do you have chickens? Ever thought about selling farm fresh eggs? My neighbors are always putting in an order for farm fresh eggs. I sell an average of 20 dozen per week at $2.25 per dozen! I started out with one customer, and by word of mouth, I now have about 15 weekly customers and that number continues to grow. I now need to increase my laying hens.
Do you have a small garden? Ever think about selling farm fresh produce? I sell fresh tomatoes, potatoes, cabbage, squash, cucumbers and much more. I do this right from my farm. I have no need to go to the farmers market. Once you build a good reputation with your neighbors, the word gets out and you will have more demand then you can supply. Everyone wants fresh farm products and really do want to support their local farmers. It’s a win-win solution for everyone.
Do you have a milk cow? Sell fresh farm milk to your neighbors! Or maybe you have plenty of timber for firewood? There are many ways to optimize your small farm and learn how to live a more self sufficient healthy lifestyle at the same time.
I could keep going, but I think you get the point. All of these hobbies can really add up and everyone benefits.
Grant the aluminium smelting industry supports 5,000 jobs, provides 0.25% of our GDP and is responsible for 6% of our GHG emissions.
Every other country makes aluminium more cleanly than we do because we have the worlds dirtiest power.
This is a case where the best possible thing would be for the planet would be for aluminium smelting to move offshore. There are 86,000 vacancies in mining that could be filled by the 5,000 smelter employees. Or for those smelter employees that prefer the city, they could move into jobs vacated by city folk that go for the 86,000 mining job.
If they were gone our per capita emissions would drop from 4 times the global average to 3.75 times the global average. Thats a massive step in the right direction.
Not only that we would get back $400M per annum in subsidies they currently suck out of our state governments. To understand the absurdity, that $400M could be spent on just paying the full wages of the 5,000 staff for doing nothing and we get the 6% drop in emissions for no net cost to state budgets, and 5,000 people get a fully paid life of leisure.
Aluminium prices have risen enormously since the smelters were built, and their profits have jumped accordingly. Its time for them to either go carbon neutral or leave. Its time for us to make a stand against such scandalous behaviour and insist they clean up their act.
Good riddance and begone I say to such a corrupt and inappropriate arrangement.
(This is all documented in Clive Hamilton’s scorcher).
Part of the problem is Australia’s (including the Greens) cry for ‘leadership’ on this issue. Leadership is a top down approach that subscribers to ‘the great man’ theory of history support as the solution to global warming, world poverty or any big problem fro that matter. “Great problems need great men to fix ‘em”. Well, surgically removed bollocks to that sexist and narrow world view.
We need successful role models of alternative action and means that people can relate to and see themselves ‘doing’. This is one reason I have latched on to the Woking example - no ‘great man’ as saviour, just a community acting in self interest with an eye to the future. It’s the deferred rewards of behavioural change at individual and local level that should be promoted. This could simultaneously appeal to self interest and altruism, ideas currently promoted as mutually exclusive but, when combined would be extremely powerful. Woking is an example of self interest and altruism symbiotically acting in a powerful way, and her figures speak for themselves.
I’ll stop here as I am not articulating this well and need to give it more thought.
hmmm……
Greens policy on global economics
http://greens.org.au/node/775
“22. support abolition of, unless radical reform can democratise, the IMF, World Bank and WTO.”
I look forward to this policy being articulated in the upcoming debate about global emission trading.
The Rudd/Wong plan is specifically designed to dovetail with these agencies.
What global strategies for climate change do the Greens support other than IMF, WB and WTO programs?
Re comments 26 and 27 above, see this new website from a group of environment NGOS: http://www.lowcarbonfuture.org.au/
“One of the previous commentators made the comment that, good riddance to dirty companies if the move off shore, but who is going to provide new employment to the 10s of thousands of employees who are out of jobs. Are these people to be just classified as casualties of change, and left to their own devices. Remember, that although new industries will obviously be created, the skill bases will be dramatically different from what is currently utilised.”
This is the standard frame of thinking that most people have. But the changes are not like having to put tradies into academics positions.
For example, a solar panel put out “electricity”, the same stuff that “electricians” work on. Bio-fuels are used in internal combustion engines, the same as what a diesel fitter might work on. Themal energy works on an external heat source, just as coal and nuclear do.
That’s just on the supply side. People will still demand the services that have been so wastefully provided before. Hence there will be new skills in “accounting” for energy use and this can be done by “accountants”.
I could go on…. and I reserve the right to do so if more strange comments appear.
Point being, that the change is at the very bottom of the food chain and the vast majority of services will be almost identical.
It is interesting to examine Appendix D of the green paper - Analysis of the emissions intensity of Australian industries.
Black Coal mining has emissions per unit of revenue of 1,722 tonnes CO2-e per million dollars of revenue. This would qualify it for 60% free permits. If it emitted more than 2,000 tonnes CO2-e per million dollars of revenue, it would qualify for 90% free permits. This is a subsidy for coal exports.
While with free permits there is still a price incentive to reduce emissions because you can reduce emissions and sell permits, when qualification for free permits is based on having a low carbon productivity there is a massive perverse incentive for having a low carbon productivity.
Peter@44. Good work, very insightful. Hope this gets pointed out where it counts. We should be levying coal exporters not subsidising.
Hopefully pollies grasp the absurdity of giving money to our most profitable companies!
Coal miners won’t leave if levied. Here is where the coal is.
Tim, regarding the link @ 42
I believe this is a good example of denialism and greenwash.
For example, it says on the “good news” page
“A recent CSIRO report (2008) found around 2.5 - 3.3 million jobs will be created in Australia by 2025, even though we would be making the transition to a low carbon economy.”
They provide no reference for this and I have not been able to find it on the CSIRO site (but I’m sure it is there).
It would be good to find a reference for this because if it is based on government figures then it is based on the myth of clean coal and means next to nothing.
Also, the site says
“Climate policies like the emissions trading scheme have the potential to increase energy bills, however if you use energy in a smarter way and reduce your greenhouse emission - then your bills could be lower than they are today.”
I am on a pension. I live in a rented flat where the slumlord owns the hot water system and the stove, the two biggest energy users. have the light bulbs and I have a small fridge and I already turn lights of when they are not in use and use the washing machine only when there is a full load.
What could a pensioner like me do to get my electricity bill lower than what it is now with higher electricity charges?
If I was a wealthy landowner I could redesign my house and buy all the right expensive gadgetry and reduce my electricity bills.
My slumlord could put panels on the roof and get a feed in tariff but I would get nothing.
And my question @ 41 was not rhetorical. What role do the greens see for the world bank, the IMF and the WTO in global carbon trading?
Sorry to harp on a point, but I have been netsurfing to try and find Green policy that reduces the impact of carbon trading on the poorest sections of the community and I have found nothing.
I have found what the Greens do not support.
“Cash handouts (tax cuts, welfare cheques, or free permits) will reduce the effectiveness of the scheme, will be inflationary, and will be temporary relief from a permanent price hike.”
http://greensblog.org/2008/07/14/key-issues-for-the-emissions-trading-green-paper/
Given that most poor people, including millions of welfare recipients, are tenants and not landowners or mortgagees, how will the most vulnerable people be cushioned from increasing electricity costs if not through welfare cheques?
John Tracey, I read that a while ago too, and I think you’ll find the ‘cash handouts’ quote was in the context of corporate, and possibly middle class, welfare, eg. cutting the fuel excise to compensate for petrol price rises under Labor’s bastardised trading scheme. That said a clearly articulated vision for Australia’s ‘relative poor’ that might be affected by a badly thought out and implemented carbon reduction scheme is warranted.
A poorly implemented scheme, such as is currently being touted by Labor and business, will disproportionately hurt the marginalised and effective safety nets must called for. I suspect it would be better for the Greens not to support the scheme as it is proposed rather than attempt to tinker with it at the margins.
The Greens are between a rock and a hard place with this, they want an effective carbon reduction system, but can they support what is being proposed? Dirty deal free permits, associated market distortions, and distant nebulous cap, does not a good system make. So I suspect the Greens will reject the scheme as proposed - assuming my crystal ball is working properly.
McFarm,
The sentence immediately before the quote above is ” It is vital that those people facing high costs, most particularly Australia’s poorest people, are compensated for these rising prices. However, it is also vital this compensation boosts, rather than undermines, the point of the scheme.”
Tim, Christine and the Greens,
Having not had an answer to my question about global economics and the world bank or local compensation for the poor I am now ready to accuse the Greens of having totally ignored and abandoned the poor in their greenhouse thinking.
Some comments on compensation:
The residential sector, including residential transport and electricity emissions, but not goods such as beef, is responsible for about 20% of Australia’s greenhouse emissions. If more than 20% of auction revenue goes to households, they have an incentive for a higher carbon price. People profit while the polluter pays. This blows Brendan Nelson’s carping on about the impact of an ETS on prices out of the water.
If poor people are have their welfare payments increased, or their taxes decreased, then this does not reduce their price incentive to reduce emissions. They can still save just as much money by reducing their electricity or petrol bills as before. However, if people were compensated in a way that is proportional to the impact on their electricity bills or whatever, then the incentive to reduce emissions is reduced (this is the case with the reductions to the petrol excise).
There is a similar issue with free permits. If you give a sector of the economy free permits, they can still reduce their emissions and sell permits. So there is still a price incentive to reduce emissions. The problem is that the method of permit allocation can lead to perverse incentives to increase emissions. This distorts these incentives. The Green Paper is particularly bad like this - firms have a strong incentive to emit more than 1,500 tonnes CO2-e per million dollars revenue, and have a strong incentive to emit more than 2,000 tonnes CO2-e per million dollars revenue. Firms whose emission intensities are around these values have incentives to ensure that their emissions are higher than these levels. This undermines incentives to reduce emissions.
Another problem with free permits is that there is an opportunity cost. There are much better ways of spending money than on pork for polluters.
I’ve modelling switching large scale (100kW plus) remote (continuous service) diesel engines to solar plants and had extensive discussions with owners of these sites.
The case to go solar is now economically compelling with only one obstacle. The problem is securing finance for the solar plant. They can pay off the solar plant very comfortably with diesel savings if they can find a willing finance provider on friendly terms.
If they switch to mains power (usually at extremely high cost to run the transmission lines to the site) their GHG emissions rises by 30%. So that is a bad answer.
The issues with conventional commercial finance providers are twofold. Firstly the finance providers are all jittery given the credit crunch and not really in the mindset to support things for the public good right now. Secondly the site operators are fearful of ruthless tactics by such credit providers.
The solution may be that the Federal government loans the funds to do the project. This is a far better use of taxpayer funds than simply giving grants, since the loan is repayed with interest. The government certainly has the cash squirreled away and they are earning truly dreadful returns on it. This way the Feds will get a much better and more secure return.
Tim, is there scope for Greens policy in relation to lending (not granting) money on terms that don’t terrify site owners for the purpose of converting diesel use to renewable use.
A bit of an update on #44, today’s Financial Review was reporting that because the international coal price has become so high, the revenue for black coal mining is higher, and it may no longer qualify for free permits. The coal industry is complaining about this of course.
People may recall recent complaints from Woodside Petroleum Limited, that the emissions from processing natural gas may not be high enough for them to receive free permits and they might have to relocate offshore etc. Yesterday’s Rentseekers’ Review is reporting that they have no plans at all to locate themselves offshore. The Greater Sunrise gas fields are located between Australia and East Timor. Woodside have announced that the processing of gas will take place in Darwin, not East Timor. This suggests two things: firstly, relocating emissions intensive industries overseas would be a good thing if it provides income to developing countries such as East Timor; secondly, Woodside’s (and many other firms for that matter) claims about having to relocate overseas are a pile of nonsense and do not deserve to be taken seriously.
Well, well, it looks like I trod on a few toes suggesting that we should be worried about people being put out of jobs, and moving dirty industries off shore.
Now lets look at these 2 issues.
1. Dirty industries moving off shore.
I though the whole aim of the exercise is to reduce the amount of emissions emitted. So where do we reduce emissions when we just move the dirty industries overseas, and they keep on the same as they have been for the past 50 years ?. Would it not be better for the planet, for the Fed Gov to assist these industries to implement new technologies over a period of time, and remain in Australia.
2. Putting 10s of thousands of people out of jobs.
Sure people may have to move, but it will be a slow painful process over a period of time. Taking Portland for example. Many of the employees have bought homes in the area, and if the smelter shuts down, they are out of jobs, and will possibly lose their homes as there are no other jobs in the area. And what about all the associated industries in Portland and surrounding areas for these families. Sorry, there is no mining down that way, only a farming community.
There are potentially thousands of businesses that will be in trouble if ETS is implemented too quickly, and as families cannot just up stakes and move to mining areas, where, by the way there is very little accommodation for families, they will become unemployed.
It has been mentioned that the solar panel industries may take up much of the slack, but where are these companies. As far as I can see there are very few manufactures (who will probably need to move off shore to compete with imported panels), mainly installation companies. Are people going to flock to have solar systems installed, not bl_ _ _y likely, unless the Feds are prepared to pay 75%+ subsidies, and I cannot see that happening.
Remember I said in one of my previous comments that the poor will not be able to afford the new technology, and the rich will just be prepared to pay the increased amounts for their energy. Lets take this one step further.
a. Salaries up to around $75k / year are really struggling with the mortgage payments (mortgage stress), so will not move in any number to new technology, and will probably need the Feds to subsides their energy usage.
b. Those over $100k will not receive any solar subsidy from the Feds, so are not likely to take up new technology in the short to medium term (this I have confirmed with my previous peers in the IT industry who are all earning over $100k).
c. Leaves the bunnies earning $75k - $100k. A fair percentage are also in mortgage stress so can be counted out, so who are going to buy all the new technology?.
In summary, as far as I can see, we (Australia) are going to be in a real mess if the Feds try to push the ETS to soon, and too fast. I believe that the Feds will huff and bluster how great they are, then pass everything to committees to review the potential impacts, pick the components with the least economic impact, and proceed with extreme caution, and minimal political damage.
Grant, a bunch of providers have sprung up offering “free” 1kW rooftop solar systems. The condition is you qualify for the rebate.
So it turns out at least some of your fears are unfounded. There is now zero obstacle to takeup among people on $100k pa. In fact there is a strong incentive since they get cheaper power bills henceforth.
Methinks Rudd’s PV rebate scheme will be overrun. At least if people on less than 100k are even vaguely tuned in to saving money.
The whole PV rebate scheme is ridiculous anyway. $8/W is way to much for govt to pay to subsidise renewable energy. It can be done much cheaper. And putting it on rooftops is unbelievably inefficient. It PV is done at all it should be in solar farms at a cost of $6/W (yes this is a real figure) and maybe with a gov subsidy of $2/W. That solar farm can pick up REC worth around $1/W (NPV’d) and then we have $3/W up front cost of power attracting full on peak revenues and the business stacks up beautifully.
This way the govt money goes 4 times as far in reducing GHG’s.
John Tracey @ 49, I am sorry, I am on leave at the moment and not able to spend the time reading all the comments and replying to them.
I will respond to your comment when I have the time, but to accuse the Greens of not caring about the poor in our greenhouse policy is completely bizarre for someone who is a regular visitor to this blog who will have read numerous posts and comments about how to make greenhouse policy act to make our society more equitable, not less.
For just one example, you should know, from your many visits, that we advocate using revenue from permit sales to retrofit the homes of Australia’s poorest people with major energy efficiency measures, and to retrofit the rest of the country on a payback scheme.
From an international perspective, we advocate the rich countries, like Australia, acting very fast and effectively to reduce emissions in order to give poor countries the chance to develop, in as sustainable way as possible, before having reduce their own emissions as fast. This will be of far greater benefit to poor countries since they will, generally, be far more susceptible to climate change than more rich countries.
More when I am back from leave in a week’s time, but in the meantime, please have a look at our EASI policy (google “Australian Greens EASI” to find it) to see how rental properties are included. We have publicly discussed updating it since it was published pre-election to make the retrofits free for the poorest sections of the community, rather than requiring payback as for most people.
If emissions caps are stringent enough, and all permits are auctioned, there will be tens of billions of dollars raised, in which case we could make a larger proportion of retrofits free.
“If emissions caps are stringent enough, and all permits are auctioned, there will be tens of billions of dollars raised, in which case we could make a larger proportion of retrofits free.” - Tim Hollo.
And there’s the rub, the cap is too distant and not stringent enough, and our biggest polluters are being given free permits with more freebies to come (just watch the natural gas ‘negotiations’). Furthermore, what’s left of the reduced monies will be spent pork barrelling just prior to the next election for Kevin ‘11. This is why Labor will/must have it’s corrupt trading scheme up and running in 2010.
Tim,
you call me absurd and then you refuse to answer the question - how politicianesque of you.
Firstly, the website changes makes it very difficult (I could not do it) to find EASI on google. However a search of this site lead me to this link on Christine Mine’s site, for anyone else having trouble finding it.
http://www.christinemilne.org.au/files/campaigns/extras/For%20web.pd
As for EASI, apart from a free audit, poor people get nothing. According to the EASI policy, not my interpretation of it, tenants will pay higher electricity costs in order to pay for capital investments on the landlords property. Apart from increased bills, this means the poor are again paying to reinforce the profits of the rich.
It seems the poor will be paying the same way as a home owner except they do not get to keep the assett at the end.
The Rudd/Wong Green paper specifically says it will be paying compensation directly to poor people by way of welfare payments.
Will the Greens be pressuring the government to do this properly including raising pensions and benefits or will it be opposing this measure because it is inflationary and not directly tackling efficiency?
As for the wold bank and Greens global economic policy - why do you avoid this issue? Where do the Greens stand?
p.s. EASI provides no relief at all to the poor for raised grocery and other prices resulting from carbon trading.
p.p.s. Tim,
Just looking through EASI again and I cannot find any reference to free retro-fits for anyone.
Why do you say “we advocate using revenue from permit sales to retrofit the homes of Australia’s poorest people with major energy efficiency measures, and to retrofit the rest of the country on a payback scheme.”?
Has the policy been ammended since August 07 to include free retro-fits for the poorest people? If so, what do their landlords pay for the capital improvement on their property in these cases? What happens when the tenant moves?
John Tracey, give the guy a break, he’s on leave for crying out loud. And be patient, he will get back to you next week.
Why is the poor an afterthought, not even a policy, at such a late stage of the debate?
How does the new suggestion of free retrofits for the poor affect the economic modelling of EASI?
Which poor will get it and which poor will not?
The simple truth is that EASI offers nothing but pain to the poor. There are no quick and easy fixes.
EASI is a policy for home owners, not the poor.
The solution? Mandatory efficiency standards on all rented houses, old and new - a pre-requisite for investing in housing just as health and safety is. Landlord/investor pays with tax breaks.
- plus higher pensions and benefits to a reasonable standard before emissions trading begins and then keep it tied to the CPI.
McFarm,
I would hope that there was more than one person in the Greens capable of answering this. After all, it is a bit topical at the moment.
John Tracey, firstly let me say re your comment at 62 that I am one of only 3 people employed by the Greens Senate team working on this at all, including Senator Milne. We have very limited resources to answer your questions and deal with the entire legislative agenda, attend conferences, do mainstream media work, take holidays, build a new website, help our colleagues understand the issues, etc. I do not apologise for not dropping all that in order to immediately answer the myriad questions we receive on the blog. Please have some patience and tolerance.
Re the world bank question, I’m sorry, I actually disagree with the underlying premise of your question, as I understand it, that global climate action is based on the world bank, the IMF and WTO. It is not. It is based on the UNFCCC. Certainly the world bank is heavily involved in funding energy projects in the developing world, as is the Asian Development Bank, and they both do a lot of harm and a little good in that field. We do not see a role for all those organisations in the global carbon trade for two reasons - firstly because, as you have pointed out, we would prefer to see them abolished and replaced with organisations which put equity at their heart, and secondly because the global carbon trade is a very small part of our vision for a global climate regime.
Our global climate policy is based on negotiating the next phase of the UNFCCC in good faith. Developed nations must take on very stringent targets and developing nations come on board in a contraction and convergence pattern. We also advocate very significant developed-to-developing country technology transfer and all that goes with it. This policy is unashamedly and obviously based on the primacy of equity.
Re EASI, firstly I apologise for the difficulty in finding it. Our website, as discussed, is crap and is being rebuilt from the ground up.
Secondly, re rental, it is very clearly stated at 2.2.4 that the landlord pays back the cost of the retrofit, not the tenant. The tenant therefore gets the clear benefit of reduced energy costs due to the effect of the energy efficiency retrofit, without having to pay a cent.
Thirdly, re free retrofits, I clearly stated @ 55 that the policy as written is out of date and we are on the record since then saying that emissions trading permit revenue gives us the opportunity of providing the retrofits free to the poorest people. How do we determine that? In the first instance it would go to Housing Commission and to the homes (rented or owned) of those on pensions of various kinds. The scheme would then be rolled out through the lowest income areas before much later going to the middle and high income regions.
Finally, you’d have to have been hiding under a rock not to know that we have a long-standing policy of increasing pensions and welfare benefits, funded by not giving tax cuts to the rich. Just because that’s not part of our climate policy doesn’t mean it doesn’t exist.
I know there’s a lot more issues in your comments that I should respond to, but I’m going back to my holiday now. I may try to address them in bits of time over the weekend and next week if I find myself in front of a computer and at a loose end.
Tim,
2.2.4 also says……
“As the details of the repayments will be publicly available, landlords will be in a position to transparently pass on this
cost as a rent increase for the duration of the repayment period.”
who pays?
I am most disturbed that out of such a big political party, social policy can be in the hands of 3 overworked people, which might be part of the reason why you forgot about the poor in your frameworks.
The senators must negotiate this with the government, ask questions in committees and propose amendments. But it seems you have not gotten around to thinking about the poor yet. Who will stick up for the poor? Brendon Nelson?
will the senators hound the government to deliver on the green papers policy of welfare compensation or will they oppose it because it is inflationary and not emission targeted?
This is real for millions of welfare recipients, even if you are on holiday.
Surely the role of the poor would have featured somewhere in the party discussions and policy formulation process? .
Since the Greens attended the UNFCC at Bali, where the role of the world bank was a major dividing point between the rich and poor world, I can only assume your comments about the world bank are more denialist politician speak.
As I remember when I asked questions shortly after Bali, the Green reps lined up with the Australian delegation in supporting the world bank against the poor and developing nations proposals.
Let me jog your memory, the statement from the president of the world bank to the UNFCC at BALI in the opening session….
http://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/ORGANIZATION/EXTPRESIDENT2007/0,,contentMDK:21585737~menuPK:64822306~pagePK:64821878~piPK:64821912~theSitePK:3916065,00.html
They have delivered on their promises, even though the UNFCC is still debating their offer, and set up a climate investment fund that will suck any ecological value out of the Rudd/Wong scheme.
http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:21826304~pagePK:34370~piPK:34424~theSitePK:4607,00.html
Some background
http://www.twnside.org.sg/title2/finance/twninfofinance20080510.htm
Tim,
i’ve just had a post disappear, maybe in moderation or spam? It had a few links on it.
But one point I will repeat, you should read the whole paragraph of EASI 2.2.4 as it also says……
“As the details of the repayments will be publicly available, landlords will be in a position to transparently pass on this
cost as a rent increase for the duration of the repayment period.”
who pays?
Proof positive @ 63, that the squeaking wheel gets fossil fuel lubricant applied.
I wish the Greens would start squeaking on global and local poverty issues inherent in global and local carbon trading schemes.
I am outraged by the exclusively rich world, middle class policies produced by the Greens, however my point here is not to identify contradictions in Greens policy, for they are not in government so their policies are still just fantasy.
The historical conditions we are faced with is the ALP Green paper and the UNFCCC process, both of which are dominated by the world bank.
If the Greens were serious about their global economics policy, instead of endorsing the UNFCCC in good faith they should be standing with the G77, “the south” and the indigenous nations that protested at Bali and denounce the process for what it is - a world bank scam.
If the Greens are opposed to the world bank, why dont they at least publically criticise the government for its role in the world bank group of the UNFCCC?
And I repeat, in the hope that maybe there might be at least one more Green party member who has considered the economics of carbon trading, or in anticipation of Tim interupting his holiday…… will the Greens oppose the green paper’s welfare compensation because it is inflationary and not targeted at carbon efficiency?
I thought the Greens had a democratic policy process, there must be someone other than Tim and Christine who has considered these issues?
Or have the senators and their staff assumed absolute control of the policy process? perhaps there is nobody else in the party who knows what the party policy is?
John T,
may I suggest you quit with the blatant strawmans and mild hysteria while you’re still just a little behind.
As this website clearly states, its the website of the green senators and their staff, and Tim is the relevant staffer on this one. Tim’s on holiday. Cope. In the interim all the information you want is amply available in the public domain from greens policies, statements, speeches and posts on this blog.
You’re an intelligent man. A quick google, or even just going straight to either Christine or Bob’s personal senate websites would find you in rapid time the literally dozens of references both of them have made as climate change spokesperson and as party leader on the need to ensure that climate change measures are not introduced at the expense of the poor. It’s not just in EASI, it’s in virtually every damn speech and comment Christine in particular has made on Garnaut, the trading scheme and Greens policies in this area. No, I’m not going to google it for you. It’s more than a tad tragic that when you either can’t or won’t find the information, you’re next response is a knee-jerk criticism and reductio ad absurdum (”I can’t find the greens saying exactly what I think they should say! The greens are therefore eeeevil!”) approach.
If you’re too obdurate to do even that, go on this very website to the links to Christine on Q&A and listen to what she said.
This is the site of a political party. Part of being a participant in the political process is accepting that it is not the realm of policy purity and perfection, nor is it your personal fiefdom to have incredibly busy public representatives on tap to answer every single one of your questions, especially when a) most of your points have been answered and b) you’ve been directed to where to find the information.
If you’re foolish enough to believe that the Greens align with vested interests against the poor, I suggest that your questions don’t have much merit in terms of time worth answering.
Myriad,
Thank you for your response. If you have read my comments you will have realised that I have read the statements, and amongst them is opposition to welfare compensation - emphatic opposition repeated in Christine Milne’s various statements.
Having uncovered EASI I find it has nothing for the poor except rent increases, but apparently this is out of date but there is no available document with the updates.
The Greens platitudes about poverty in press releases is admirable, but if policy or more import