AI Group supports govt's new climate report for industry

A report from Prime Minister John Howard's climate change task group, released on June 1, recommends starting work immediately on establishing a "cap and trade" scheme, with carbon trading to begin in 2012.

The report said a realistic timeframe is a key factor in implementing any scheme, which also needs to consider that many of the biggest greenhouse gas emitters operate on the international stage.

Ai Group Chief Executive Heather Ridout said the report offered business a way forward that also reflected Australia's particular circumstances and sought to position business in a meaningful way in the global climate change effort.

But she warned that Australia also needed to understand that introducing such a scheme was complex and would be costly.

"Importantly, it will come at a big cost to business and consumers through higher energy and compliance costs.  These costs should not be underestimated particularly when Australia's key competitors will not be subject to them," she said.

Many Australian businesses were also unaware of the complexities involved in implementing such a scheme, she said, quoting a yet-to-be-published Ai Group study that showed some 85% of companies surveyed indicated they had little understanding of emissions trading schemes and the systemic impacts of measures to address climate change.

"The lead time suggested by the Task Group will provide the scope to build community and business understanding of the proposed measures and to ameliorate the impact of the cost," Ridout said.

"It will also allow Australia time to design an approach that has rigour and avoids the pitfalls that have characterised previous approaches overseas.

"We will study the report in greater detail and will be consulting with our members on its implications.  Industry seeks to be part of finding a broad-based and effective solution to this most important issue."