Australia's carbon trading scheme rejected

CANBERRA, Australia, Aug. 13 (UPI) -- Australia's Senate today rejected the government's ambitious carbon trading scheme aimed at thwarting global warming.

The proposed law called for reducing greenhouse gases by between 5 percent and 15 percent of 2000 levels in the next decade, with a conditional upper limit of 25 percent if other nations agreed to similar targets during the December U.N. climate change talks in Copenhagen, Denmark.

The Australian government's previous emissions reduction target was between 5 percent and 15 percent of 2000 levels by 2020.

The CTS proposal also called for carbon permits at $7 a ton for a one-year fixed price period beginning in July 2011, followed by a floating price until July 2013.

The Senate voted 42-30 against the law. Climate Change Minister Penny Wong said after the vote that the government plans to reintroduce the legislation after three months. If the amended bill fails in November, it could lead the ruling Labor Party to call for an early election.

"This bill may be going down today, but this is not the end," Wong told the Senate.

"We will bring this bill back before the end of the year because if we don't this nation goes to Copenhagen with no means to deliver our targets.

It's not smart to pretend this won't leave us isolated from the rest of the world, and it's not smart to undermine our transition to a low-carbon economy," she said.

Opposition leader Malcolm Turnbull has called for excluding emissions from coal mining and agriculture from the plan.

Coal-fired plants supply about 86 percent of Australia's electricity, and coal is its biggest export. It also has the highest per capita carbon emissions in the developed world.

Without a pollution reduction plan, Wong said earlier this month, Australia's emissions will grow to 120 percent of the 2000 level.

The environmental lobby maintains that the proposed targets are not ambitious enough.

Some business groups said the plan would hamper Australia's economic recovery and lead to job losses. In May, Royal Dutch Shell's Australian unit urged the government to revise the proposal to avoid reducing the ability of local companies to compete internationally.

In a statement today, Australia's largest green energy retailer Origin reiterated its support for the plan and called for all political parties to negotiate a workable agreement "to ensure this crucial reform is passed as soon as possible."

"We believe an emissions trading scheme should be the central policy mechanism to guide the investments and behavioral changes required to address the long-term challenge of climate change," said Origin's executive general manager of policy and sustainability, Carl McCamish.

He said the legislation "provides the framework for a good, workable scheme" and "is sufficiently flexible to adjust over time to ongoing developments in the science of climate change and in the international negotiations around Copenhagen and beyond."