The Business Council of Australia released its policy benchmarks for the 2010 election in June. These benchmarks spell out policy principles the BCA believes should apply in responding to the potential risks associated with climate change.

The BCA’s benchmarks on emissions reduction are as follows:

• In the transition to a low-emissions global economy, Australia must seek to maintain its competitiveness.
  
• Given the scale of the required economic transition, a multifaceted approach in Australia is essential.
  
• While a market-based mechanism for emissions reduction is the primary vehicle, other supporting policies, investments and initiatives will be required to ensure the research and development necessary to identify technology solutions, including low-emissions technologies, improved energy efficiency, and to build Australia’s adaptation capabilities.
  
• Australia’s emissions reductions policies must:
  – be at least cost to the economy;
  – use market-based mechanisms, where possible;
  – maintain the reliability and viability of our domestic electricity industry; and
  – protect the competitiveness of our trade-exposed and export industries.

Against these principles, the BCA’s Chief Executive, Katie Lahey, said that elements of the climate change and energy efficiency policies announced by the Prime Minister today were useful.

These include:

• Recognition of the need for a multifaceted approach, including moving to a market mechanism for emissions abatement.
  
• The opportunities for voluntary early abatement by business.
  
• The potential for the renewable energy fund to provide a better environment for decisions in the electricity sector and to increase investment in electricity infrastructure.
  
• The fact that new emissions standards for coal-fired power stations will not be applied retrospectively.

There remain a number of important issues around which consultation will be needed, including:

• The new emissions standards that will apply to coal fired power stations, and
• Some sectors will continue to have concerns regarding the emissions baselines as proposed under the CPRS.

“The ALP’s commitment to building community consensus is constructive,” said Ms Lahey. “However, in this complex policy area, long-term solutions that balance Australia’s economic and environment considerations will only come through strong political leadership.”