June 23, 2009 / 7:04 AM / 11 years ago

Australian Senate to delay emissions trade vote

(Recasts with Senate developments)

* Australia set to delay emissions trade vote

* Early election options further clouded

* Independent wants more economic modelling

By James Grubel

CANBERRA, June 23 (Reuters) - Australia’s parliament is set to delay any vote on the government’s controversial emissions trading scheme until August, further confusing Prime Minister Kevin Rudd’s options for a possible early election.

Conservative opposition lawmakers, who hold the largest voting bloc in the Senate, struck a deal on Tuesday with two independents to effectively delay a vote until August in a move the government described as a political stunt.

"They have been filibustering, wasting time, using every tactic they can to delay debate on this bill," Climate Change Minister Penny Wong told reporters.

If the Senate delays a vote this week, as expected, the delay could qualify as the first rejection of the laws. If laws are rejected or fail to pass twice, with an interval of three months, the prime minister gains a legal trigger for an early election.

But in their current form, the laws are also likely to be rejected in any vote in August.

That means Rudd could have the option of calling an early election by December or early 2010, although he has publicly said he would prefer to run a full three-year term, with regular elections due in late 2010.

The package of 11 emissions trading scheme bills are being debated in the upper-house Senate, but the government has been unable to attract the extra seven votes it needs to pass the laws to underpin the scheme, due to start in July 2011.

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For a story on likely outcomes click on [ID:nSP488415]

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Key independent Senator Nick Xenophon set up the latest delay when he agreed to an opposition motion to bring on debate on nine other bills on Wednesday, ensuring the Senate will run out of time to pass the ETS package.

Parliament returns from its winter break on August 11, when Xenophon and the conservative parties have given a commitment to put the ETS bills to a vote.

In the meantime, Xenophon will commission more economic modelling on alternatives to the government’s plans.

"My position is that I do not believe it is appropriate to have a vote on the second reading stage," Xenophon told parliament. "There is no bigger issue in terms of the economic and environmental welfare of this nation."

Australia’s emissions trading scheme will be the world’s broadest, covering 75 percent of emissions and covering around 1,000 of the largest polluters, from transport operators to aluminium makers, who will have to pay to pollute.

Australia, the world’s biggest coal exporter, accounts for 1.5 percent of global carbon emissions but is amongst the highest per capita polluters due to a reliance on coal for 80 percent of domestic electricity.

The government will on Wednesday try to extend the Senate’s sitting hours to ensure some time to resume debate on the emissions scheme, though it is unlikely to gain any support.

Conservative Senate leader Nick Minchin said the opposition did not believe the ETS bills were urgent, given that the scheme is not scheduled to start until July 2011.

The government is seeking to cut emissions by five percent by 2020 and up to 25 percent if developed nations agree on tough action at climate talks in Copenhagen in December.

The opposition wants a final decision on the ETS delayed until after global climate talks in Copenhagen in December, and until the United States’ position is clear. Green senators, who hole the balance of power in the Senate, want 40 percent cuts. (Editing by Bill Tarrant)

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