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Thursday, 30 October 2003
Page: 17372

Senator TCHEN (5:08 PM) —I rise this afternoon to speak on the Kyoto Protocol Ratification Bill 2003 [No. 2] that was introduced into this chamber by Senator Brown and Senator Lundy. I am delighted to have the opportunity to talk on this very interesting issue. Firstly, can I particularly thank Senator Wong who spoke before me because she has presented the government's case in a most comprehensive way, even though she had to make some obligatory criticism of what the government has done. In fact, she actually described perfectly why Australia has not ratified and should not ratify the Kyoto protocol.

It is my belief that this bill should be taken seriously. If Senator Brown were the only sponsor of it—if this bill came only from the source that Senator Brandis so aptly described in this chamber on Tuesday as `well-meaning oddballs' and `the scruffy ratbag set'—then we probably would not need to take it seriously because we would know that it was nothing more than another political stunt by Senator Brown. However, this bill is jointly sponsored by the Labor Party and, as we all know, the Labor Party has to be taken seriously. Not only could the Labor Party notionally provide an alternative government for Australia; it has in the past, with very serious consequences for this country. Therefore, anything the Labor Party proposes must be taken seriously. That is not to say that any ideas or policies advanced by the Labor Party should be taken seriously—it is just that it is making some effort in this area.

I note that this bill is being introduced into the House of Representatives by none other than the Labor Party's shadow minister for sustainability and the environment, Mr Lindsay Tanner.

Senator Webber —No, Kelvin Thomson.

Senator Crossin —Wrong one!

Senator TCHEN —I am sorry, Kelvin Thomson—my apologies. So it would be not too far-fetched to think that this bill represents that very scarce commodity: a Labor Party policy. If it is a Labor Party policy, it is another reason to take them seriously. According to the second reading speech circulated by Senator Brown and Senator Lundy, the bill requires the Australian government to ratify the Kyoto protocol within 60 days of its being passed by the parliament. That is a very tight timeline—one that obviously befits a monumental world-saving decision. But hang on a moment. If we look at that second reading speech we find that in fact this bill does not propose a monumental world-saving decision. Let me quote the first sentence of the speech:

The Kyoto Protocol will not save the world's climate.

It will not save the world's climate, so what is the rush? Senator Brown and Senator Lundy say that the Kyoto protocol is the first step that demonstrates the willingness of the world's nations to acknowledge the threat of global warming and to form a global alliance in response. But such a global alliance has been working since 1988, when the International Panel on Climate Change, the IPCC, was established. In the meantime we have other models of international conventions which deal with environmental issues, such as the Montreal protocol, which provides a much better model than the Kyoto protocol.

The bill requires the government to prepare a national climate change action plan. It says that the minister must ensure that Australia's aggregate human induced carbon dioxide emissions do not exceed its assigned amount. It says that the minister must establish a national system for estimating human induced carbon dioxide emissions by sources and removals sinks. It also requires the government to publish an annual inventory of greenhouse gas emissions, and there are a number of administrative processes. But I will come back to those points later.

There are some very simple steps to be taken. As Senator Lundy and Senator Brown said in their second reading speech, they believe this bill is simple, it is necessary, it is overdue and it should be passed. They believe the key word is `simple'. They believe dealing with climate change is simple. They believe the Kyoto protocol is a simple process that requires only a simple response. Let us look at the Kyoto protocol to see if it is so simple. Earlier, my colleague Senator Eggleston discussed the Australian government's response to the Kyoto protocol, so I want to go back to what is perhaps the first principle—that is, what the Kyoto protocol really is.

The first thing we know, as Senator Brown and Senator Lundy have pointed out, is that it will not save the world. In fact, not only will it not save the world but, if it is not approached or managed wisely—as Australia is doing—it might well damage the world's climate. The Kyoto protocol was devised as a means of pursuing the objectives of the United Nations Framework Convention on Climate Change. Article 33.3 of the framework convention states:

... to stabilise greenhouse gas concentration in atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system. Such a level should be achieved within a time frame sufficient to allow ecosystems to adapt naturally to climate change, to ensure that food production is not threatened and to enable economic development to proceed in a sustainable manner.

I draw the Senate's attention to the last sentence. The United Nations Framework Convention on Climate Change recognises the importance of allowing economic development to proceed in a sustainable manner. It proposes to do so by establishing greenhouse emission limits and reduction commitments for each party to the protocol. The protocol requires the party to take action to ensure that their greenhouse gas emissions do not exceed their assigned limits and reduction commitments, with a view to reducing overall global emissions of such gas by at least five per cent below the 1990 level in the commitment period 2008 to 2012.

The protocol describes a range of different targets for different countries. It ranges from an eight per cent reduction to a 10 per cent increase above the 1990 level of greenhouse gas emissions, depending on the circumstances of each country. These levels are achieved through negotiation between parties. Some countries have to reduce their emissions. For example, countries in the European Union have to reduce their emissions by eight per cent, the United States by seven per cent, and Canada and various other countries by six per cent. I seek leave to table appendix C to the Kyoto protocol, which lists the emission limits or reductions of about 30 of the annex I group of countries, the developed countries.

Leave granted.

Senator TCHEN —It is required that each country's target must be achieved within the period 2008 to 2012. I think those dates are important, because earlier Senator Eggleston might have mentioned the minister's statement that, in 2000, Australia's greenhouse gas emissions stood at 105 per cent of the 1990 level. On current policy settings, Australia's emissions are projected to reach around 110 per cent of the 1990 emissions level by the end of this decade. Australia's target for 2012 is 108 per cent of the 1990 level. So, in looking at those figures, we are well on track to reducing our emissions level and our policy will mean that Australia will be well within the target set for us by the Kyoto protocol.

The Kyoto protocol will come into force when 55 parties, representing at least 55 per cent of those developed countries, have ratified the agreement. As of last month, I understand that 119 countries have ratified the Kyoto protocol. However, they do not in any way approach 55 per cent of the annex I group of countries' carbon dioxide emission total. So the protocol is some way away from coming into force.

The United States—as various speakers have noted—have not ratified, and have actually signalled their intention not to ratify, the Kyoto protocol. As the United States provide some 36 per cent of the world's carbon dioxide emissions, that will make the ratification rather problematic. Up until recently, it was believed that the Russian Federation, which is the second largest carbon dioxide emitter in the world—representing an output of something like 17.5 per cent of the developed world's production of carbon dioxide—was going to ratify it. However, more recently the Russian government have indicated that they do not believe that ratification of the Kyoto protocol would be in Russia's national interest, so that is unlikely to happen.

The important thing about the Kyoto protocol is that it provides some innovative ideas. Particularly, it provides three innovative mechanisms that developed countries may use to lower the costs of meeting their national emission targets. The first one is called a clean development mechanism. This assists developed countries to reduce emissions through cooperative projects with developing countries, which the protocol's emission targets do not cover. Under this mechanism, developed countries can claim reductions against their emission totals, while developing countries benefit from projects which contribute to sustainable development.

The second mechanism is called the joint implementation mechanism. This refers to projects between developed countries where parties may fulfil their commitment jointly so that the targets are shared between several countries. The third mechanism is emission trading, which is a mechanism to assist developed countries in meeting their targets by debiting or crediting each country's greenhouse gas emissions. A developed country that produces more emissions than required by their national target will be able to sell their excess emission credits to countries that are finding it more difficult or expensive to reduce their own emissions. These are the mechanisms which the Kyoto protocol proposes to assist countries to meet their targets.

The simple ratification of the Kyoto protocol would not actually deliver any useful outcomes, because there are many issues associated with the protocol which are yet to be finally agreed. This has been the situation since the year 2000. There has been much debate in a number of conferences in which parties have looked at all the implications of how these mechanisms work and the various unresolved issues related to the Kyoto protocol, but no resolution has yet been reached.

I will give an outline of the unresolved issues. The first is whether there should be a ceiling or a cap on the flexible mechanisms that I mentioned which countries can use to meet their targets. Some countries believe that there should be a cap and other countries believe that it should be open and people should be able to trade freely. Another issue involves what quantity of sink credits may be generated through sink activities and how much trading of these types of credits can be undertaken.

Some of the other issues are more fundamental. For example, what happens to a party which signs up to the Kyoto protocol and yet fails to meet its target? This could potentially be a very serious issue. Ratification is a simple matter—you just sign on the dotted line. We have many examples of signed agreements that are not worth the paper they are written on. Another issue is how to fund activities, and what those activities should be, in developing countries. Of course, an even more fundamental issue is what happens with the emissions of the developing countries, which will very shortly, in a few years time, overtake the total emissions of developed countries? (Time expired)