Foreign Correspondence

[fuagf]

Australian Senate Rejects Climate Bill; Rudd Left Empty Handed
By Jesse Riseborough and Ben Sharples

Dec. 2 (Bloomberg) -- Australia’s Senate rejected the government’s climate-change bill, frustrating Labor Prime
Minister Kevin Rudd’s ambition of taking landmark legislation to global warming talks with world leaders in Copenhagen.

The government will send the legislation to the Senate for a third time when parliament resumes in February, Deputy Prime Minister Julia Gillard told reporters in Canberra today. Senators voted 41 to 33 against the bill, which included plans for a carbon trading system similar to one used in Europe.

“There is no danger of this country rushing ahead, but as a result of the actions of the opposition, there is a
risk this country is left behind,” Australian Climate Change Minister Penny Wong said during today’s Senate debate.

The failure followed a revolt in the opposition Liberal Party that saw a new leader withdraw support for the Rudd plan. The deadlock over setting a cost for the carbon emissions blamed for heating the Earth’s atmosphere complicates investment decisions for companies such as Santos Ltd,Woodside Petroleum Ltd. and AGL Energy Ltd.

“AGL is disappointed with the further delay in the implementation of a national ETS,” Australia’s biggest electricity retailer
said today. “We believe that without a firm decision on climate change, business will continue to face investment uncertainty.”

Australia’s liquefied natural gas industry has more than A$200 billion ($186 billion) of investment projects
on the board. Woodside, meanwhile, is building a A$12 billion liquefied natural gas project in Western Australia.

“The prospect of a carbon price in Australia is unlikely to diminish if the legislation is deferred or defeated, but such action could result in higher costs as other policy choices fill the void,” Don Voelte, chief executive of Woodside, said in a letter to Rudd on Nov. 30.

Get Design Right

The bill’s rejection would provide the opportunity to get the design right, Mitchell Hooke, chief executive officer of the Minerals
Council of Australia, said in a statement today. The legislation would have cost the economy at least A$120 billion to
2020 and resulted in the loss of thousands of jobs, without “materially” reducing greenhouse gas levels, he said.

Rudd, 52, had wanted the climate bill approved before he travels to Copenhagen this month to attend
a meeting of more than 190 countries seeking terms for a new treaty to cut greenhouse-gas emissions.

Today’s rejection may give Rudd an election trigger through a double dissolution, a procedure under the Australian constitution
to resolve deadlocks between the Senate and the House of Representatives. The house has already approved the bill.

Political Foes

Should Rudd eventually call an election over the issue, he would face off against new Liberal leader Tony Abbott, who says
the prime minister’s plan amounts to a A$120 billion ($112 billion) tax without doing much to mitigate climate change.

Australia, the world’s biggest coal exporter, was proposing to reduce greenhouse gases by 5 percent to 15 percent of 2000 levels in the next decade. While the U.S. is the biggest greenhouse-gas producer among developed nations, Australia has overtaken it as the biggest per-person emitter of carbon dioxide, British risk analysis firm Maplecroft said Sept. 9.

‘Avoid Small Schemes’

“We have to avoid a proliferation of small schemes that increase the regulatory burden on Australia’s companies, do not share the burden of shifting to a lower carbon economy equally across the economy, and offer no guaranteed environmental outcome,” said Carl McCamish, head of policy and sustainability at Origin Energy Ltd., Australia’s second-largest electricity and gas retailer.

The fate of Rudd’s bill was entwined with that of former opposition leader Malcolm Turnbull, 55, who was ousted yesterday by his party partly for backing the legislation. Abbott has said he’s prepared to fight an election over climate change.

Two Liberal senators, Judith Troeth and Sue Boyce, crossed the floor to support the bill in the 76-seat upper house, honoring a deal struck by the coalition with Labor last week which offered A$7 billion in assistance to coal and electricity producers in return for opposition support.

The two Liberal votes ultimately proved insufficient to ensure passage of the bill, which didn’t have the support of the Australian Greens and independent senators. The Greens said the bill didn’t go far enough to combat global warming.

“The defeat of the CPRS may, in fact, provide Australia with greater flexibility in its negotiating position, as it is now no longer wedded to having to support a scheme that would only have been recently adopted by the Australian parliament,” Australian National University Professor Donald Rothwell said today in a statement.

To contact the reporter on this story: Jesse Riseborough in Canberra at [e-mail]; Ben Sharples in Melbourne at [e-mail]
http://www.bloomberg.com/apps/news?pid=20601087&sid=ax3aE3GpLudQ&pos=9

6 months ago, Kevin Rudd danced and spun, he made 'practical', 'realistic' concessions, fyi some here ..

Carbon bill burns as Rudd fiddles
PHILLIP COOREY .. May 5, 2009

In the biggest policy reversal of his prime ministership, aimed at wooing big business and the Liberal Party,
Kevin Rudd announced the scheme would be delayed by one year to July 1, 2011, beyond the next election.

Compensation for the nation's heaviest polluters would be more generous and the price of a tonne of carbon for
the first year would be fixed at a low $10, reducing by half the original projected impact on energy bills.

As a sop to environmentalists, there was a heavily conditional commitment to increase from 15
per cent to 25 per cent the maximum amount by which greenhouse gases would be reduced by 2020.

"I am in the practical business of responding to realistic challenges," Mr Rudd said of his reversal, which, he said, would
mean "a slower start" but a "stronger, greener conclusion".
http://www.smh.com.au/environment/climate-change/carbon-bill-burns-as-rudd-fiddles-20090504-asme.html

Kevin Rudd cops it on the chin and goes to Copenhagen a disappointed
man. As mentioned earlier, Rudd has stayed out of the debate in recent times.

He knew.