Julia Gillard has called on business to help put the case for a carbon price, stressing the commercial opportunities in the transition to a low pollution economy.
The Prime Minister told a business breakfast in Sydney yesterday that on a visit to California she noticed that the climate change dialogue was focused on opportunities to ”make a buck”, and called on Australian business leaders to ”channel that spirit into Australia”.
As she pledged to push for a carbon price next year, Ms Gillard said there was a broad view in business that Australia needed to ”get on with this job … and I’m determined to do that”.
With United Nations climate talks getting under way in Cancun, Mexico this week, GE’s Australasian commercial director, Ben Waters, asked whether Australia’s unilateral emissions reduction target - to reduce greenhouse gas emissions by 5 per cent below 2000 levels by 2020 - would be reviewed since it was not strong enough to prevent dangerous climate change.
Ms Gillard said Australia would be holding to its unconditional emissions reduction target of 5 per cent, while keeping open the possibility of lifting the target to 25 per cent depending on international action.
”We’ll be holding to these [targets] as we design the pricing mechanism that will get us there,” she said.
A report published yesterday by the Australian Conservation Foundation said a 5 per cent cut in the economy’s emissions by 2020 would require more than $100 billion in investment in energy, transport and infrastructure.
As any carbon price was likely to be modest, it would not provide a strong enough incentive to raise $100 billion worth of investment, the report said.
To address this, the foundation said other incentives would be needed to mobilise green investment. For instance, governments in Scandinavia have issued ”green bonds” to help fund renewable energy projects and energy efficiency programs.
The British government has formed a ”Green Investment Bank” to help lower the risk of investing in green projects today, before a global agreement on carbon has been struck.
The foundation’s economic adviser, Simon O’Connor, said these types of measures could boost private investment in clean energy and minimise the need for extra government borrowing.
“In Australia, governments use a suite of financing tools to support other industries - loan guarantees and risk insurance for exporters, tax credits for the film industry and off-take agreements and co-investment for major utilities,” he said.
“It’s time government got smarter in applying the available tools to deliver the low carbon economy.”
