Prime Minister Malcolm Turnbull has made it clear his Government will not impose a carbon tax or an emissions trading scheme, after a day of confusion about a review of climate change policies.
Energy Minister Josh Frydenberg said the Federal Government was in favour of energy security, after backtracking on a possible carbon price for power companies.
Mr Frydenberg announced an energy review on Monday that would examine the best ways to meet Australia’s climate commitments and told ABC Radio an emission intensity scheme was being considered.
“We know that there’s been a large number of bodies that have recommended an emissions intensity scheme, which is effectively a baseline and credit scheme, we’ll look at that,” he said on Monday.
Within hours, the proposal was criticised by Liberal backbenchers including Cory Berardi who described it as “one of the dumbest things” he had heard and warned there would be political costs.
On Tuesday night, Mr Frydenberg told Melbourne’s 3AW Radio that he was not contemplating a carbon-pricing scheme but was instead focused on keeping electricity process low.
“I didn’t mention an emissions-intensity scheme, it’s not in any document that the Coalition has put out, in relation to this review,” he said.
“The Turnbull Government is not contemplating such a scheme… we’re not advocating for such a scheme.”
On Wednesday, Mr Frydenberg told reporters in Hobart the review had never intended to look at establishing a carbon tax.“I have never advocated for a carbon tax and an emissions trading scheme; that is why the Government won’t proceed with one,” he said.
“I have a position that is very clear, that we will not be adopting an emissions intensity scheme.”
Prime Minister Malcolm Turnbull would not comment on why Mr Frydenberg made the initial comments on ABC Radio, or whether they were approved by his office.
“You will have to ask Josh Frydenberg that,” Mr Turnbull said.
Labor claims Frydenberg caved under pressure
Opposition spokesman for the environment Mark Butler said Mr Frydenberg had caved under pressure from the right wing of the Liberal Party.
“It is quite clear why Josh Frydenberg said what he did on Monday morning; this is good policy and it should have been part of the review,” Mr Butler told AM.
Labor’s Tanya Plibersek said the right-wing of the Liberal Party had yanked Mr Frydenberg’s chain and forced him to reconsider his position.
“What we know is that electricity generators, industry and business in general say they want is some certainty, some predictability,” he said.
“What they are getting instead is chaos. They have got an ideological war in the Liberal Party that is actually directing what happens with energy policy in this country.”
‘Business as usual’
Mr Turnbull said there was no mention of an emissions intensity scheme in the review despite Mr Frydenberg’s comments on ABC Radio.
“The one thing I want to be very clear about, we are not going to take any steps that will increase the already too high cost of energy for Australian families,” he said.
“We will not be imposing a carbon tax and we will not be imposing an emissions trading scheme, however it is called.
“An emissions intensity scheme is an emissions trading scheme — that is just another name for it.”
On Monday, Mr Frydenberg said there had been recommendations for a “baseline and credit scheme”, which could be similar to an emissions trading scheme where emissions are capped by the Government.
In 2014, the Abbott government passed legislation to repeal the clean energy package — or so called carbon tax — put in place by Labor.
It followed a lengthy campaign on the issue, which Tony Abbott described as a “historic betrayal” when it was unveiled by then prime minister Julia Gillard in 2011.
The federal environment minister has sought to allay backbench concerns about a government review into climate change policy.
Following a Cabinet meeting on Tuesday and public criticism from several Coalition MPs, Josh Frydenberg ruled out an emissions-intensity scheme.
“The government will not be adopting new policies which increase the already high cost of electricity for Australian families,” he told The Australian.
“In particular, the government will not introduce an emissions-intensity scheme, which is a form of trading scheme that operates within the electricity generation sector.”
Malcolm Turnbull’s decision to review the Coalition’s climate change policy caused obvious unrest this week, particularly after former prime minister Tony Abbott told Andrew Bolt the issue was reminiscent of 2009, when disagreement over climate policy cost Mr Turnbull the Liberal leadership.
Facing a possible backbench revolt, Mr Turnbull has now promised the climate policy review is simply business as usual, telling media on Tuesday he has never supported a carbon tax.
Mr Frydenberg pointed to the Opposition’s climate policies as “more expensive” and providing “less reliable energy”.
The reliability of new energy was debated by politicians following South Australia’s statewide blackout during storms in September 2016.
A review by the Australian Energy Market Operator found that half of the state’s wind power cut out before the transmission faults that incredibly threw the whole state into darkness.