On this subject of carbon trading and suggestions that the government is not doing enough. Well, I’m not convinced. Thing is there is a bunch of legislation already passed that deals with the obligations of organisations to publish data about the energy levels they are consuming, the energy they are producing, and the emissions they are generating as a by-product. That legislation has a significant impact on these bigger companies out there (and ok, it’s a smaller number of companies but it is the industries that matter when we do the numbers). So right now those big industries (including those constitutional companies that we don’t talk about much) are doing the stuff necessary to meet the legislative reporting requirements (and this is both a cost for those organisations and a economic stimulus for those other organisations providing the info-technology to support this).
So if we project out into the future a couple of years from now – we will be seeing the emergence of data coming from out from major industry players. For any one of these players chances are we are talking about hundreds of millions of dollars in potential liabilities (with or without an ETS). Factor into this equation the emergence of an ETS irrespective of targets (because the target is partially academic if we look at the end-game). What is more important is the putting in place of the mechanisms – because once you have the reporting mechanisms in place then, and only then can you start playing policy with the economic configuration (a.k.a. tweaking taxation dials and whatnot). With those mechanisms in place (and I can’t emphasise enough that the establishment of those reporting mechanisms is what is really important here) you turn a page of the management equation – only then can you actually start to manage the problem – and only then can we start to be responsible – companies (even the big polluters) will start to understand and factor into day to day decisions the economic consequences of operational decisions.
The reduction target does not matter (at least today) – because today – today we are just grappling with the problem of capturing the information about what we are doing. Two years from now and the federal government will start to see numbers that are meaningful (as in the Australian Federal Government will have the initial numbers of the flows of energy and the emissions from individual companies and those constitutional corporations at a level of granularity that will make your head spin). But that time-point is important but it’s not what we need – what we actually need is trend lines. We need a few years to get to the point of understanding the picture of what is happening in Australia. It is from this perspective that I think that less is more – because what Australia does in emissions production is not the issue, what is much more important is what Australia does in establishing the regulatory framework from which we can demonstrate a national comprehension and from that – grounded and concrete actions – based on national facts that are linked to national corporate entities – that implicate national employees – that change union policies – that generate informed local opinion.
Australia is not a global leader on this issue – but the Australian Federal Government is working on fundamentals that are critical for a responsible solution. Targets and levies are just numbers and dials – what is more important is establishing the machinery capable of responding to adjustments, and the machinery capable of returning accurate and reliable feedback on changes.
We are heading in the right direction.
And take a deep breath – because we still have a way to go.