EDITORIAL: by Peter WestmoreNews Weekly
Taxpayers to help subsidise UN's $100 billion climate fund
, March 19, 2011
The failure of the 2009 UN Climate Change Conference in Copenhagen to set enforceable targets for cutting CO2 emissions has not stopped the Australian Government committing billions of dollars to the UN's Green Climate Fund, which is intended to raise $100 billion a year by 2020.
The extent of Australia's commitment to funding the UN's climate change agenda is unclear; but Climate Change Minister Greg Combet signed up for it at the UN Climate Conference at the Mexican holiday resort of Cancun, last December.
It helps explain why Prime Minister Julia Gillard is determined to push ahead with a "carbon tax" this year, despite widespread public opposition.
Mr Combet told the Cancun conference, "In June 2010, Australia announced it would contribute $599 million to fast-start financing for climate change. I'm very pleased to report that we're delivering on this commitment." He said that "close to 80 per cent of Australia's fast-start commitment has now been allocated to countries and regions, as well as to specific multilateral initiatives. This funding is already flowing to developing countries."
"This demonstrates that we are delivering on our pledge, working with other countries which are committed to providing funding under the Copenhagen Accord," he said.
In a later statement, he said that among the achievements of the Cancun conference was "the establishment of a new Green Climate Fund to help developing countries deal with climate change", but he did not put a dollar value on this fund or the size of Australia's commitment to it.
Documents from the UN's website show that it intends to raise a massive $100 billion annually by 2020, despite the lack of international agreement on greenhouse gas reduction.
Mr Combet's statement gives no indication as to what commitments Australia has made to that fund. Yet he can hardly claim ignorance of what is proposed. In a statement issued on December 10 last year, Mr Combet said he had been invited to "chair the high-level negotiations on the establishment of the Green Climate Fund. This has been a major achievement of this conference and will mobilise significant funds to help developing countries tackle climate change."
As Australia's commitment to the Green Climate Fund will undoubtedly dwarf the $599 million already committed, Australians are entitled to know how much this will cost - particularly as the cost will come from the new "carbon tax".
One suggestion, quoted in the West Australian
newspaper on February 28, 2011, "emphasises the importance of a carbon price in the range of US$20-25 per tonne of CO2 equivalent in 2020 as a key element of reaching the US$100 billion per year".
The problem with putting a price on CO2 has been emphasised by recent developments in Europe and the United States.
In Europe, where governments have underpinned the European Union's emissions trading scheme (ETS), the spot market has recently collapsed, the third such collapse since the ETS was established around 2005.
All carbon-trading was suspended by the European Commission on January 19, after the biggest-ever allowances fraud netted as much as €28 million worth of carbon permits.
One carbon market expert, Mark Lewis of Deutsche Bank, was quoted describing the carbon market as "effectively dead", despite the market being propped up by European governments and the European Commission.
In the United States, the main emissions trading scheme, the Chicago Climate Exchange (CCX), collapsed last August, when the price of CO2 fell to just 10 cents per tonne. It is now 5 cents a tonne.
There is no prospect of the US Congress enacting a carbon price. The American Clean Energy and Security Act, a greenhouse gas cap-and-trade bill, was passed in the House of Representatives by a vote of 219-212, six months after Obama took office. The bill originated in the House Energy and Commerce Committee and was introduced by Henry A. Waxman and Edward J. Markey. However, it was never passed in the Senate.
With the Republicans defeating the Democrats for control of the House of Representatives last November, the chances of a carbon tax or ETS being adopted during the rest of Obama's term in office are effectively zero.
In the meantime, plans to set up an interim committee to run the UN's Green Climate Fund are in turmoil, because of disagreements as to who should comprise the committee.
A date set for the first meeting of the interim committee, March 14, 2011, has been abandoned because of disagreements at a regional level. Groups of Asian, Latin American and Caribbean countries are deadlocked over who will attend the 40-nation UN talks.
OPEC nations in the Asian group are also demanding compensation for a loss of oil revenue if the world shifts to wind or solar energy.
In the meantime, Julia Gillard remains hell-bent on imposing a new tax on Australians, in part to fund the UN's international climate change agenda.Peter Westmore is national president of the National Civic Council.