Government to look before it jumps on CO2

THE Australian automotive industry is gearing up to put its case for a co-operative approach to motor vehicle carbon emission reductions at a national inquiry ordered by the joint federal-state Council of Australian Governments (COAG) in Darwin this week.

The industry welcomed the decision by COAG not to rush into mandatory restrictions in CO2 emissions from motor vehicles and instead look at options to reduce the carbon impact from cars and light trucks.

Car companies and the Federal Chamber of Automotive Industries (FCAI) are now awaiting the terms of reference of the inquiry, including a starting date.

The industry agrees with a proposal to set new carbon targets, but is concerned car-makers might be slapped with penalties that overlap with the federal government’s broader emissions trading scheme (ETS), creating a cost double whammy.

The FCAI fears such an impost would be especially detrimental to local manufacturers.

For now, the state and federal governments have agreed to hold “a detailed regulatory assessment of introducing CO2 emissions standards for new light vehicles”.

The COAG communiqué said the regulatory statement would assess the impact of both voluntary and mandatory standards on the automotive industry and how it would fit with the Carbon Pollution Reduction Scheme.

“COAG will make a final decision following thorough consultation with industry and the community,” it said.

Left: Federal environment minister Peter Garrett.

A statement from federal environment minister Peter Garrett said such new standards had the potential to reduce fuel consumption by around 30 per cent, based on overseas studies.

The FCAI has cautioned against comparing the European and US mandatory CO2 restrictions with the Australian current target of 222 grams of CO2 per kilometre, saying the overseas schemes had marked differences with the local voluntary scheme.

In Europe, where a limit of 120g/km is about to be imposed, the emissions trading scheme (ETS) does not include road transport, nor does the vehicle emissions limit include SUVs and LCVs. As well, diesel fuel in Europe receives tax breaks, encouraging more widespread use of CO2-reducing diesel.

FCAI chief executive Andrew McKellar said the industry was committed to reducing vehicle emissions and increasing fuel efficiency“We support a comprehensive review and it is important that all options are on the table,” he said.

“The COAG decision demonstrates a clear commitment to achieve better outcomes for the environment and consumers.

“Vehicle brands will be active and constructive participants during this review process.”

Mr McKellar said the new strategy should be consistent with the targets established by the federal government’s CRS.

“It also fits well with the positive incentive provided by the new Green Car Innovation Fund which will encourage the production of more fuel efficient vehicles in Australia,” he said.

“The industry has a positive track record of reducing emissions and we have achieved our current target of 222 grams of carbon dioxide per kilometre more than a year ahead of schedule.

“The time is right to set a new target and the industry agrees this should be consistent with leading international standards.”

COAG also agreed to streamline regulations for heavy transport, announcing plans to establish a single national regulator for all vehicles weighing more than 4.5 tonnes.

The regulator will take charge of inspection standards, safe driving hours, weight limits and registration.

COAG proposed that the reforms be fully implemented by 2013, while transitional arrangements will be in place by 2011.

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