The Australian oil and gas industry says the political and commercial landscapes have changed significantly since the Australian Parliament last considered pricing carbon and this needs to be recognised in the treatment of Australia’s liquefied natural gas (LNG) exporters.
The Australian Petroleum Production & Exploration Association’s submission to the Government’s Multi-Party Climate Change Committee supports a national climate change policy that delivers abatement at least cost and facilitates investment decisions consistent with there being an international price on carbon. However, the submission also says APPEA will assess proposals for treatment of LNG exporters against the MPCCC’s own principle, which states:
Competitiveness of Australian industries: The overall package of carbon price design and associated assistance measures should take appropriate account of impacts on the competitiveness of all Australian industries, having regard to carbon prices in other countries, while maintaining incentives to reduce pollution.
A range of measures not included in the 2009 “political settlement” negotiated by the major parties are required to maintain the international competitiveness of Australia’s LNG industry, including a 100% permit allocation until Australia’s competitors such as Qatar, Nigeria, Algeria and Malaysia are subject to a carbon price.
The APPEA submission says: “ As has been considered and accepted by every major credible analysis of an emissions trading scheme undertaken in Australia and internationally, if policies and measures such as emissions trading schemes are implemented in some countries and not in others, there will be distortions .”
APPEA Chief Executive, Belinda Robinson said: “ While the pre-Copenhagen Carbon Pollution Reduction Scheme assumed the imminent development of a global carbon pricing agreement, it is clear that no such agreement is imminent .
“ Selling our gas to the world is the most meaningful thing Australia can do to reduce global emissions and a climate policy that puts the brakes on Australia’s LNG potential will only deny the rest of the world a cleaner form of energy, at a time when demand has never been greater. Studies by Worley Parsons and the CSIRO show that for every tonne of greenhouse gas emissions associated with the production and use of Australian LNG, up to 9.5 tonnes of emissions are avoided in customer countries when this LNG is substituted for coal in electricity generation.
“ The Government should not lose sight of the fact global warming is a global issue and that Australian gas exporters need to be treated as part of the solution, not part of the problem .”
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Source: APPEA, May 16, 2011;