Climate Institute finds $4 billion hole in Coalition's direct action policy

Climate Institute finds $4 billion hole in Coalition's direct action policy

Climate Institute finds $4 billion hole in Coalition's direct action policy

Updated 15 August 2013, 9:23 AEST

The Climate Institute says the Coalition would need to spend an extra $4 billion under its direct action plan to meet Australia's pledge to cut carbon emissions by 5 per cent by 2020.

The Climate Institute says the Coalition would need to spend an extra $4 billion under its Direct Action Plan to meet Australia's pledge to cut carbon emissions by 5 per cent by 2020.

Opposition Leader Tony Abbott has pledged to repeal the Government's carbon tax in favour of a plan which involves planting trees and providing financial incentives for polluters to reduce their carbon output.

A 2010 document outlining the Direct Action Plan states the policy will cost $3.2 billion over four years.

But economic modelling by the independent climate body has found emissions would increase under the policy unless more money was committed.

"Even with conservative assumptions, the Coalition's policy as it is currently defined would see Australia's emissions rise about 9 per cent by 2020," its chief John Connor said in a statement.

"To achieve their promised range of 2020 carbon cuts of 5 to 25 per cent below 2000 levels, the Coalition would need to spend at least an extra $4 billion to $15 billion by 2020."

The Climate Institute says the costs could be reduced if the Coalition removed its restrictions on using cheap international carbon permits under direct action.

It says that would reduce the extra cost of meeting the 5 per cent target to $190 million, or $710 million for 25 per cent emissions reduction.

Opposition environment spokesman Greg Hunt has been highly critical of relying on international offsets.

The Climate Institute based its analysis on modelling by Sinclair Knight Merz-MMA and Monash University's Centre of Policy Studies.

It notes that as the Coalition is yet to announce some details of its policy, its "modelling is based on a number of conservative assumptions about how the policy will work in practise".

The Climate Institute says its assumptions are likely to overestimate the emissions reductions that would be seen under the Coalition's plan.

Opposition rejects Climate Institute's findings

A spokesman for the Coalition has dismissed the modelling as "unprofessional" and originating from a partisan organisation.

The spokesman says the findings are based on wrong assumptions and do not relate to the policy.

But Mr Connor says the Climate Institute has engaged with Mr Hunt "for some time".

"We've been clear we've supported a price and a limit on pollution but all our modelling is out there," he told AM.

"We've engaged with Greg Hunt on this for some time. We gave him a detailed briefing of the outcomes on Monday night.

"You can attack the man or attack the data. I'd love to see independent data which challenges what we've found here."

Climate change policy: a key difference between parties

Both major parties have committed to meeting the 2020 target, and to further reduce emissions by between 15 and 25 per cent depending on global action.

But heading into the election, their policies are vastly different.

Last month Prime Minister Kevin Rudd announced Labor would dump its controversial carbon price ahead of schedule and move to an emissions trading scheme.

Where do the parties stand on climate change?


Not sure about the state of play? Inform your vote using our policy page.

The Federal Government wants to move from a fixed carbon price of $24.15 a tonne to a floating price of about $6 by July 2014, a year earlier than planned.

Under the Coalition's Direct Action Plan, funding would be allocated to projects designed to reduce emissions.

"We will support projects such as the exploration of soil carbon technologies and abatement, putting carbon back in soils and providing for a once in a generation replenishment of our farmlands," the party's Real Solutions booklet said.

Mr Abbott has also pledged $300 million over four years to create an environmental workforce known as the Green Army.

The Climate Institute found the Coalition's policy would reduce domestic carbon pollution by 200 million tonnes by 2020.

In contrast, it says Labor's current laws would see a carbon reduction of 290 million tonnes.

The modelling also found gross national income per capita would grow by around $6,900 by 2020 under the current policy, and by around $7,200 under Coalition policies.