Friday, August 31, 2007

Emissions trading in Australia and Climate Change and Business Conference

I am a huge supporter of a carbon trading system. Without capturing the external costs of carbon dioxide, the full value of cleantech products cannot be realized. I just returned from the Climate Change and Business conference, held in Brisbane this year, and it was very worrying and informational.

It was worrying because many people reported on data from the Intergovernmental Panel on Climate Change, which basically states that we need to make massive changes to peak our per capita emissions of CO2 within the next few years or we risk catastrophic changes to the Earth. I'll talk about this more in a later post.

However, it was informational because I learned a little more about the emissions trading scheme that Australia is considering. Both parties now claim to support such a scheme (with, of course, no real details available until after the election!) However, both parties plan for a roll-out in the next 5 years (2012 for Liberals, 2011 for Labour). I think this is great, because once capital markets can influence things, they can be a tremendous force for change. However, this highlights the slow pace of change - 5 years before an emissions trading scheme is active!? If we take decades to make changes, and we only have a little over a decade to start moving the needle, we need to get away from the "environment or the economy" discussion which many politicians use to frame the debate, and quickly recognize the Stern Report conclusion, which is that the "pro-economy" policies are ones which mitigate the damage of climate change. It is the policies which allow greater climate change damage to occur that will truly destroy the world's economy.

More to come...

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