The following is attributable to CMI CEO John Connor:
The Carbon Market Institute (CMI) welcomes today’s credible policy package and increased climate ambition from the ALP but urges stronger 2030 targets for decarbonisation investment.
The announcement is an encouraging step that builds on the bipartisan consensus target of net zero emission by 2050, but recognises increased ambition and investment in climate solutions is required this decade.
The proposed policy package cautiously but credibly builds on Australia’s policy architecture, responding to industry and think tank calls to evolve the existing “Safeguard Mechanism” which requires over 140 of our largest emitters to manage, measure and occasionally do compliance trades in emissions.
While trading under the carbon pricing and Safeguard emissions mechanism has been relatively small to date, industry analysis from Ndever Environmental and Reputex suggest nearly a million tonnes may need to be traded by early next year. The baselines and procedures in this mechanism can relatively easily evolve to credibly assist in guiding greater emission reduction investments.
CMI believes the proposed 2030 emissions reduction target of 43% falls short of the at least 50% reductions required for Australia to do its fair share of reductions in keeping average global warming well below 2C and pursuing efforts to limit warming to 1.5C.
The proposed target is closer to other major economies and trading partner country commitments (e.g. EU 55%, US 50-52%, Canada 40-42% and South Korea 40%) announced ahead of COP26 in Glasgow, but these collective targets all still require strengthening to achieve agreed climate goals.
The new target would relax but perhaps not entirely remove pressures for carbon border adjustment tariffs for Australian exporters under consideration by the EU and others.
CMI welcomes the plans to review and build on Australia’s well-established and globally regarded carbon crediting mechanism. COP26 agreed to new rules for international cooperation and carbon markets which will be established in the next few years, presenting a once-in-a-generation opportunity to ensure they assist climate, environmental and agricultural productivity goals with high integrity. This is another welcome area of bipartisan support.
We look forward to further discussions on the detail in the ALP policy package when we hear from Shadow climate spokesperson Chris Bowen at next week’s CMI Summit (Friday 10 December).
The upcoming 8th Annual Australasian Emissions Reduction Summit
CMI’s largest-ever business and climate action Summit on 9 and 10 December 2021 at the Sydney International Convention Centre is a unique opportunity to explore the outcomes of COP26 and its implication for Australian governments, business and the region. Speakers include the Chair of the Pacific Island Forum, Fijian Prime Minister Frank Bainimarama; Co-Chair of the Voluntary Markets Integrity Initiative Rachel Kyte; Australian Energy and Emissions Reduction Minister Hon. Angus Taylor; NSW Treasurer, Energy and Environment Minister Matt Kean and Opposition Energy and Emission Reduction Spokesperson Chris Bowen.
Limited registrations are still available.
The Carbon Market Institute is the independent industry association for business leading the transition to net zero emissions. Its over 120 members include primary producers, carbon project developers, Indigenous corporations, legal and advisory services, insurers, banks and emission intensive industries developing decarbonisation and offset strategies.
To interview John Connor please contact Thomas Hann on 0408880536 or via email: thomas.hann@carbonmarketinstitute.org
