Australian Prime Minister John Howard announced yesterday that Australia, one of the worst per capita polluters in the world, will launch a domestic carbon trading scheme in 2012 to fight global warming.
But Howard warned that capping the carbon dioxide belched out by coal-fired power stations could seriously hurt the economy and Australia might have to turn in part to previously shunned nuclear energy.
"Implementing an emissions trading scheme and setting a long-term goal for reducing emissions will be the most momentous economic decision Australia will take in the next decade," he said.
"If we get this wrong it will do enormous damage to the economy, to jobs and to the economic well-being of ordinary Australians, especially low-income households," he said.
Howard, whose government joined the US in refusing to sign the Kyoto Protocol on limiting greenhouse gas emissions, said Australia's trading scheme would be better than those already in place in Europe.
"More comprehensive, more rigorously grounded in economics and with better governance than anything in Europe," he told an annual meeting of his Liberal Party national council.
But his refusal to set a target for the reduction in emissions until next year and the delay in implementation until 2012 drew immediate criticism.
"Climate change is not going to wait for the Liberal Party," Australian Greens leader Senator Bob Brown said.
"Keeping global temperature rises to two degrees Celsius or less requires rigorous action now," he said.
Howard attributed the delay in setting a target to a need for rigorous economic modelling, but critics noted that it also meant he would not have to announce the figure before general elections at the end of this year.
The opposition Labor Party, which has pledged a cut of 60 percent in emissions by 2050, has a strong lead in opinion polls.
Climate change has become a major political issue in Australia, where the worst drought in a century is hitting agriculture and the economy and threatening drinking water supplies to cities.
Howard said Australia, which holds 40 percent of the world's uranium reserves, would also have to set aside opposition to atomic energy and consider the introduction of nuclear power stations.
The plan would involve the government setting a cap on emissions and granting businesses permits to cover the amount of greenhouse gases they produce each year. Firms wishing to emit more carbon dioxide than their allocated quota would have to buy permits from companies with a surplus, thereby creating an economic incentive to reduce pollution.
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