The setback was expected after months of hardening resistance to prime minister Kevin Rudd’s plan. Rudd said he still aimed to push laws through parliament this year. Eventual success was not assured, however, as Rudd’s concessions were rejected as flawed by political opponents. Some in the carbon industry said the delay could help clear away uncertainty that had blocked early trade and clouded the outlook for corporate costs.
The new draft included several short-term concessions to big industry in Australia, one of the world’s biggest carbon emitters per capita: a low fixed price capped for a year at 10 Australian dollars (US$7.36), with a transition to full market trading in July 2012; and increased eligibility for free emissions permits, including 95% for the heaviest export-oriented polluters.
But Rudd also left open the possibility of deeper reductions. Maintaining his interim 2020 reduction target at 5 to 15% below 2000 levels, Rudd said his government could move to a 25% cut if other rich nations agreed to similar reductions at United Nations climate talks in Copenhagen in December.
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