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Business seeks ambitious climate targets

08 October 2014

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Frank Jotzo is Director of The Centre for Climate Economics and Policy at Crawford School, and director of the School’s Resources, Environment and Development program. He currently teaches the graduate courses Domestic Climate Change Economics and Policy and Issues in Development and Environment.

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Australia needs to set more ambitious emissions reductions targets for 2020 and beyond which better align with global trends and key partner countries, a national survey conducted by the Carbon Market Institute (CMI) and Crawford School has found.

The 2014 Australian Emissions Reductions Survey is a collaboration between CMI and the Centre for Climate Economics and Policy (CCEP) at Crawford School of Public Policy. The project leader for CCEP was ANU Public Policy Fellow Associate Professor Frank Jotzo.

The project heard from 245 respondents, representing a cross section of experts and senior executives from major greenhouse gas emitting industries, investors and professional service providers. It is the most comprehensive business survey on emissions reductions taken in Australia this year.

The survey found that increasing Australia’s 2020 emissions reduction target beyond the current five per cent below year 2000 levels to better align with our key trading partners was strongly supported by respondents.

“Particular support was evident for aligning with emissions targets and policies in our key international trading partners. It is seen as necessary to avoid the risk of potential negative trade and investment impacts as countries move to decarbonise their economies,” said CMI chief executive officer Peter Castellas.

“Survey respondents overwhelmingly agreed that Australia’s economic growth will increasingly depend on how well we adapt to a low carbon world,” Castellas said.

Jotzo noted that respondents saw developments in China, the United States and Europe as particularly important factors for Australia’s climate policy.

“Around three quarters of respondents said that there will be risks of adverse trade and investment decisions if Australia does not harmonise its emissions reduction targets with key trading partners,” said Jotzo.

“Setting more ambitious emissions reduction targets which better align with global trends and key partner countries was a strong theme throughout the survey.”

The survey also indicated strong support for an independent institution such as the Climate Change Authority, along with business research institutions, to be involved in setting Australia’s post-2020 target.

“All countries are called on to submit their post-2020 targets by March 2015, and the debate has not even started in Australia”, said Jotzo.

Castellas said that survey respondents identified that a lack of investment and innovation in low carbon technology, supply chains, products and services which a price on carbon stimulates would be at risk if Australia does not price carbon in line with our key trading partners.

“The overwhelming majority (90 per cent) of respondents agreed the private sector has a key role to play in funding emissions reduction initiatives,” said Castellas.

Respondents said it is important to have a fully informed approach to emissions reduction targets - all key factors in decision making and all major opportunities for cost-effective emissions reductions should be considered. The survey also raised issues about Australia’s emissions reduction targets for the post-2020 period. CMI will convene business and government to explore these issues. This will be a key focus for the Institute’s 2015 Australian Emissions Reduction Summit.

Many of these topics are covered in courses Frank Jotzo teaches at Crawford School including Domestic Climate Change Policy and Economics (EMDV8081) and Issues in Development and Environment (EMDV8013). You can also find out more about the Master of Climate Change at http://programsandcourses.anu.edu.au/2015/program/MCLCH

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