Kayoz points to this story about how Howard blocked emissions trading three years ago. This makes interesting reading in the light of the recently-announced Task Force on Emissions Trading, consisting entirely of public-servants and representatives of carbon-intensive industries. As one might expect, farmers, and others who want action are Not Happy.
The obvious implication is that the whole thing is designed to kick the problem into touch for six months, then come up with some meaningless window-dressing which can withstand analysis just long enough for an election campaign. If this is correct, it does not say much for Howard’s reputation as a brilliant tactician, in touch with middle Australia.
It’s obvious to nearly everyone by now that we need immediate action and that means carbon taxes, emissions trading or both. This judgement is only going to be solidified when the Fourth IPCC Report comes out in January, confirming the consensus on climate change in much stronger terms than the Third Report. The science denialists will no doubt get some kind of run, but they are now more of a liability than an asset for those seeking to delay action. The more plausible (though still wrong) Lomborg line, that climate change is real but not important enough to justify economic action, has been undercut by the Stern Review, and by the fact that most of those embracing it are still having two-bob each way on outright denialism.
Given that most Australians can see this, a report from energy-intensive industries saying we should focus on research and voluntary action is unlikely to convince anyone. Howard has already been outflanked by Rudd on the nuclear issue and on Kyoto, and a report like this would do nothing to retrieve the position.
But suppose that Howard has worked this out, and intends to introduce some form of emissions trading as a pre-election rabbit from the hat. If the public servants on the committee push for this, the business reps will find it hard to resist. After all, there is no coherent alternative. And once they signed off, Howard would be insulated against blowback from the sectors they represent.
If Howard is indeed the Machiavellian genius he is painted as (most notably by Jack Strocchi in the comment threads here) this is the strategy that will ultimately be revealed.
John Quiggin 
I agree that Howard has cleverly placed some big emitters in an excruciating position, which makes an outcome almost impossible to predict. Perhaps the task force will split into dissenting camps. I also agree that Australia was a pacesetter on clean energy in the mid 1990s when Howard ascended. From memory big innovations at the time included the vanadium redox battery, a hybrid petrol-electric Holden, tidal power and several types of solar concentrators. In terms of implementation rather than invention we now seem to be lagging the rest of the world.
“…that means carbon taxes, emissions trading or both”. How would that work?
Another issue is how the extensive Federal Govt.work done in 1999 on emissions trading is to be used. And of course the issue of offsets hangs heavy over the whole issue. The US sulphur dioxide emissions trading system, which has attracted favourable comment on this blog, has been held up as an example of a successful emissions trading scheme without offsets, and indeed its success has sometimes been credited to the absence of offsets provisions.
We should not forget that the states have already set up a National Emissions Trading Taskforce (http://www.emissionstrading.net.au/). The National Emissions Trading Taskforce has been investigating the possible design for a National Emissions trading Scheme. The taskforce was first set up in 2004. It has released a Discussion Paper outlining a possible scheme in August 2006, and is recieving submissions on this discussion paper.
The scheme is proposed to initially cover electricity generation from firms producing 30 MWe, and is proposed to at a later date cover stationary energy producers producing over 25 kt carbon dioxide equivalent. The proposed scheme cap is for a 5-19% reduction in emissions in 2030 compared with 2005, and a 60% reduction in emissions by 2050. The allocation method will be to austion permits except for permits to coal fired electricity generators and ‘trade exposed energy intensive industries’.
In my opinion the cap is not strong enough for Australia to do what is required for global greenhouse gasses to stabilise at a level of less than 550 ppm carbon dioxide equivalent. The coverage needs to be increased (with less exemptions) and the free allocations seem a little perverse. The aluminum industry in Australia certainly doesn’t need any more subsidies (see http://www.tai.org.au/documents/dp_fulltext/DP44.pdf ).
Maybe Howard is going to propose an even weaker scheme – the terms of reference talk a lot about competitiveness, which seems to be a code word for carbon intensive industries to find ways of finding subsidies, exemptions and other forms of protectionism. Both Howard’s focuses on climate change, Nuclear power and geosequestration, are technlogies which are not available for immediate reductions in emsissions. Some interesting clues as to what Howard is up to can be found in some leaked minutes from a 2004 meeting between Howard, MacFarlane, and a group of carbon intensive industries called the “Low Emissions Technology Advisory Group” (at http://www.tai.org.au/documents/downloads/WP56.pdf)
It is interesting that the Stern Review recommends technology policies that address market failures which have led to insufficient investment in RD&D in low carbon technologies, and cautions against “picking winners”. John Howard seems to like “picking winners”, which happen to be technologies that wont be available till 2020 or later..
Pr Q speculates:
Oh ye of little faith.
Well Howard is halfway to making Machiavellian history with the mother of all back-flips on climate change curbing policy. Howard has signalled that he wants a greenhouse gas emmissions measuring system in place before he commits to a national greenhouse trading system.
Sensibly he wants a report on the economic downside, as well as the ecologic upside, of such a system. The SMH reports Howard’s latest bit of ideological gymnastics:
It remains to be seen whether Howard will complete the back-flip by authorising greenhouse gas trading regime before the election. My money is that he will do so in a neat bit of electoral cross-wiring, just as he cut Latham off at the knees with worker rabble rousing in Tasmania.
If he does I have no doubt this Machiavellian genius will land on his feat.
I found this in a c++ textbook (Stroustrup):