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By Rob Taylor
CANBERRA, Sept 23 (Reuters) - Australia’s plan to impose a carbon emissions trade scheme on its $1 trillion economy within two years will not be affected by global financial turmoil, Climate Change Minister Penny Wong said on Tuesday.
Wong, in an interview with Reuters, said the cost of doing nothing or delaying the regime’s planned mid-2010 introduction would rapidly spiral with Australia already in the grip of long-term drought and climate change.
"The costs of failing to act on climate change will be greater than the costs of taking responsible action. The later we act, the higher the costs will be," Wong said.
"We know that we have to do what we can to reduce the likelihood of dangerous climate change for ourselves and for our children, so it’s important that we continue to press on with these reforms," she said.
Australia is developing one of the world’s most comprehensive emissions trading schemes, with laws to reach parliament by early next year following discussions taking place with 1,000 of the country’s biggest polluting companies. [ID:nSYD67037] [ID:nSYD332898]
Under the scheme, businesses would buy permits to emit carbon in a system expected to raise at least A$10 billion ($8.4 bln) during its first phase.
The scheme would also help reverse Australia’s ranking as one of the world’s top per-capita greenhouse gas polluters because of its reliance on coal-fired power stations.
But big business has warned the scheme could be a "company killer", forcing high-emission firms offshore or out of business at a time of global financial turmoil. [ID:nSYD142008]
Wong, 39, is charged with finding international consensus on climate change and efforts to slow it, and lead domestic moves to rein-in water use on the world’s driest inhabited continent. Australia’s scheme, she said, should mesh eventually with an emissions trade regime operating in Europe, which is being overhauled to widen its reach to more companies after accusations it was too weak to help stabilise climate change.
"Our preference in the longer term is for open linking. It is in all of our interests to reduce emissions no matter where they are," Wong said, before adding the scheme would face limits on international trading in its early years.
Wong said it was too early to speculate on the likelihood of the centre-left government’s scheme passing in the upper house of parliament, in which balance of power now rests with a disparate group of left-leaning Green and conservative independent lawmakers.
Malaysian-born Wong, who moved to Australia aged 7, will lead Australia’s team at next year’s U.N. climate summit in Copenhagen, aimed at striking international agreement on a replacement to the Kyoto Protocol climate pact.
Kyoto’s first phase, which commits only 37 rich nations to binding emissions cuts, ends in 2012 and the goal is to agree a new pact that binds all nations to emissions curbs from 2013.
She said it was important that laws governing Australia’s emissions cap-and-trade scheme pass before the Copenhagen meeting at the end of 2009 as a sign of good faith to developing countries.
A hard negotiator and former Australian coal industry union lawyer, Wong said the Denmark meeting would be "complex and difficult", and poorer countries would be looking for action on climate change from wealthier nations in the leadup.
She said Copenhagen presented a crucial opportunity to lure emerging economic powerhouses such as India and China into global efforts to fight climate change.
"This is a global issue, this is an issue which requires all nations to play their part. It particularly requires those countries who form the majority of the world’s emissions to play their part," Wong said.
For more on this issue click on factboxes: Australia’s Carbon Footprint [ID:nSP112103], Impacts of Australia emissions trade [ID:nSYD338720] ($1 = A$1.19) (Additional reporting by James Grubel)