From Envirowiki

The Carbon Pollution Reduction Scheme (CPRS) is Rudd government's rebranding of a fairly stock-standard Emissions trading scheme.

Contents 1 Process 2 Proposal 3 Problems with the CPRS 4 Random bits 5 Criticism 6 References

[edit] Process

The CPRS is currently in the planning stage - a green paper has been released^[1], and was open for public comment until the 10th of September, 2008 (See http://www.climatechange.gov.au/greenpaper/consultation/index.html). Public comment is now closed, the final release of the Garnaut review is out, and the government will soon release a white paper.

[edit] Proposal

The CPRS, as proposed by the government green paper, has a number of caveats:

• Only include businesses emitting over a certain amount.
• Subsidise heavy vehicle, farm, and fishing fuels.
• Offset higher fuel prices (by decreasing excise?)
• It is proposed that forestry CPRS credits be additional to the overall cap, and be allowed to be sold into the scheme. This is ruinous. It has the potential to defeat the scheme in its most crucial first period.
• The Green Paper proposes that, "Scheme caps would be set and announced for a minimum period of five years in advance at any one time." We need to strongly support this since industry is pushing for periods of up to forty years.
• From the outset the targets will be generous to industry anyway, as they "will be consistent with the remaining four years of this commitment period." That is, they will be aiming to emit 108% of what they emitted in 1990.
• The first five year missions cap for the CPRS is going to be established before the Kyoto second commitment period begins – probably before it is even agreed to in Copenhagen.
• The Green Paper proposes that, "The scheme cap would not be adjusted in the event that it is incompatible with internationally negotiated national targets and, if necessary, the Government would make up any shortfall in internationally agreed targets by purchasing international emissions units."
• It is proposed in Chapter 3 of the CPRS Green Paper that Government should not be able to cancel permits without providing compensation. This would fetter the Government’s ability to take emergency measures should immediate and deep cuts in emission become urgently required.
• The Green Paper proposed that, "initial assistance would be set at around 90 per cent for EITE activities with emissions intensities above about 2,000 t CO2-e/$ million revenue and at around 60 per cent for those with emissions intensities between about 1,500 and 2,000t CO2-e/$ million revenue."
• The Green Paper proposes that between 2010 and 2020 "assistance would be provided to emissions-intensive trade-exposed industries as proposed unless broadly comparable carbon constraints are introduced in key competitor economies, in which case assistance would be withdrawn". After 2020 there is a possibility of a 5 year phase out of assistance.
• Industries and entities that are not “trade-exposed” but are emissions intensive – namely coal-fired power stations -- will receive “direct assistance” for their permit liability administered through a proposed Electricity Sector Adjustment Scheme. It doesn't say whether this would come in the form of one-off cash payments, or free permit allocations.

[edit] Problems with the CPRS

• The flexibility being proposed in the CPRS is designed to cushion the industries most culpable for climate change. This is perverse, and for the scheme to work – to actually reduce carbon pollution commensurate with global requirements and risk aversion, we need flexibility to screw down emissions are low and as quickly as possible.

The green paper makes no mention of a time to peak carbon.

[edit] Random bits

• The Green Paper states that, "The 10 industries with the highest emissions per unit of revenue … are estimated to have contributed around 37 per cent of national emissions in 2001–02, and comprise about four per cent of national production, three per cent of employment and 15 per cent of total exports."
• And "The data suggest that for the most emissions-intensive industries, an indicative carbon price of around $20/t CO2-e would increase costs by around 10–15 per cent."

[edit] Criticism

The OECD, a coalition of free-market democracies (including, ironically, the US) has criticised the CPRS on the basis that a number of it's measures would be counter productive to increasing efficiency and reducing global emissions^[2]. The OECD also called for Australia to charge more for it's coal.

[edit] References

1. ↑ (2008-07) Carbon Pollution Reduction Scheme Green Paper - Full Report . Canberra: Department of Climate Change. Report. Retrieved on 2008-09-03.
2. ↑ "Govt's emissions scheme flawed, says OECD". ABC News (Australian Broadcasting Corporation). Retrieved on 2008-10-11.