Electric dream: ALP sets target for cars

SIMON BENSON
APRIL 1, 2019
The Australian
Bill Shorten will impose an ­aggressive pollution cap on ­industry and business if elected, in a bid to meet Labor’s ambitious climate change targets, and will push for half of all new cars sold in Australia to be electric within a decade.
On the eve of the federal budge­t, the Opposition Leader will today unveil the party’s controversial climate change policy, repeat­ing Julia Gillard’s pledge to not introduce a carbon tax but vowing to resurrect the former Labor government’s Climate Change Authority.
In an effort to meet its ambitious emissions reduction target of 45 per cent on 2005 levels by 2030 — coupled with a 50 per cent renewa­ble energy target — Labor would significantly expand the Coalition’s safeguard mechanism that currently applies to polluters emitting more than 100,000 tonnes­ of carbon emissions a year.
The threshold would be reduce­d to 25,000 tonnes and cover a broader range of industries and businesses.
Labor’s policy, which will shape one of the most hotly contested­ election battles, would expand the number of companies captured under the safeguard mechanism from 140 to 250.
However, the policy also says the cap could be reduced over time, potentially catching an ­increasing number of firms. Mr Shorten has promised that a Labor government would consult with industry and businesses about a timeframe for phasing in the new cap.
Under the broader policy, new vehicle emission standards in line with US regulations, rather than more stringent EU laws, would also be enforced, while the use of international carbon credits would be reintroduced to allow Australian polluters to offset emissions.
A national electric vehicle target­ of half of all new car sales would be driven first through a mandated target for government fleets of half the vehicles being electric by 2025.
Federally funded road upgrades would also be linked to electric vehicle charging infrastructure, as well as incentives for electric vehicle charging facilities for residential and commercial developme­nts.
Farming would be exempt from the national cap but would be targeted under new federal laws to crack down on states with ineffective regulations over broadscale land-clearing.
Critics claim this move would impose the forced reforest­ation of agricultural land.
A ramped-up offset market for carbon farming would also be explored­, while businesses would be given tax deductions to buy electric cars for business purposes.
The electricity market would be exempt from the expanded safeguard mechanism, with Labor exploring the option of allowing businesses to purchase renewable energy offsets generated from the electricity sector.
However, it would be covered by the Coalition’s shelved national energy guarantee, which Labor would revive in its bid to decarbonise the electricity sector.
Importantly, Labor would not use the so called Kyoto carry-over — the emission reduction ­achieved by Australian beyond its Kyoto commitments — as credits towards its 2030 target of a 45 per cent reduction on 2005 levels.
This leaves Mr Shorten with the task of reducing total emissions by an extra 1.3 billion tonnes within 10 years without the use of the 367 million tonnes in carry-over that the Coalition is counting towards meeting its Paris target of a 26-28 per cent reduction in emissions by 2030.
Modelling conducted by BA Economics last month suggested that under Labor’s targets, with the use of carry-over, an effective carbon price of $97 a tonne would be created.
Without it, it flagged a quasi-carbon price of $696/ tonne.
The modelling also suggested a 60 per cent reduction in coal-fired generation would be needed, which would drive up wholesale electricity prices by more than 50 per cent by 2030. “There will be no carbon tax, carbon pricing mechanism, or government revenue,” the policy document released last night claimed.
“Rather, Labor will reduce pollutio­n from the biggest industria­l polluters by extending the existing pollution cap implemented by Malcolm Turnbull — the safeguard mechanism. The safeguard mechanism was established under the Liberals and Nationals to cap industrial pollution for the biggest polluters, by setting pollution limits or ‘baselines’ for covered facilities.
“However, the Liberals and ­Nationals have failed to make this mechanism effective in bringing down pollution, or incentivising reduction of pollution below a ­facility’s baseline.”
The new vehicle emissions standards of 105g CO2/km for light vehicles, which the government claims would add $5000 to the cost of a new car, would be in line with US regulations.
Labor has already announced it would abolish the Coalition’s Emission Reduction Fund.
The ERF has failed to drive down Australia’s emissions, while costing Australian taxpayers $2.25 billion, with the Coalition pledging a further $2bn for the policy­.
“Labor’s approach isn’t about punishing polluters, it’s about partnering with industry to find real, practical solutions to cut pollution­, in a way that protects and grows industry and jobs,” Mr Shorten said.
“There is only one major polit­ical party serious about real action on climate change — Labor.
“That’s because we are determined to pass on a better deal to the next generation — and we will partner with business and industry to achieve it.”
In relation to the pollution cap, Mr Shorten said Labor would help energy-intensive­, trade-exposed­ industries, such as alumin­ium, to meet their obligations with a $300 million reserve fund under the banner of a “strat­egic industries taskforce” to ensure they ­remained internation­ally competitive.