The Australian government's failure to ratify the Kyoto protocol is costing the nation $3.8 billion a year in lost investment opportunities, according to a study released by the Australian Conservation Foundation. Under Kyoto, mechanisms have been set up that allow companies to receive carbon credits for investing in low-emission and renewable energy projects, and sell them.
The Australian government's failure to ratify the Kyoto protocol is costing the nation $3.8 billion a year in lost investment opportunities, according to a study released by the Australian Conservation Foundation.
Under Kyoto, mechanisms have been set up that allow companies to receive carbon credits for investing in low-emission and renewable energy projects, and sell them.
But the report, conducted by sustainability consultancy Cambiar, finds the Government has given "limited if any" support for companies to be part of Kyoto low emissions projects.
Participation in one such scheme, the Clean Development Mechanism, which allowed companies to invest in emissions-reduction projects in developing countries, was complex and made difficult by the lack of the Government support.
The report estimates Australian companies were missing out on $2.4 billion every year through their failure to participate in the Clean Development Mechanism.
!ADVERTISEMENT!
ACF chief executive Don Henry said this was occurring "because of the immense hurdles facing most Australian companies interested in participating in such projects".
Companies also had no incentive to invest in local carbon reduction projects because they would not gain carbon credits, as Australia had not ratified Kyoto and had no emissions trading scheme of its own.
Those carbon credits could otherwise be sold on the European Union trading market or the Joint Implementation trading markets, another Kyoto scheme, resulting in a loss of $1.2 billion per year.
"The fact that Australia has not ratified the Kyoto protocol is not an absolute barrier to participation in the carbon markets that have been established by action under the protocol," the report said.
"However, Australian companies are at a disadvantage."
Another $180 million was being lost because, unless it ratified Kyoto, Australia could not assume its role as the natural centre for a regional carbon trading hub, Mr Henry said.
As a major existing financial hub for the Asia-Pacific region, Australia would be well placed to take on that role, creating an industry based around legal and accounting services.
"By ratifying the Kyoto protocol, Prime Minister Howard could achieve a great practical economic result from APEC - boosting Australian investments in renewable energy and efficiency measures and helping reduce emissions in other APEC economies," Mr Henry said.
