Rudd wants the scheme passed in time for the Copenhagen climate change talks next month; however, reports emerging today show the Coalition is split on passing the bill.
Climate Change Minister Penny Wong said assistance would be provided to the coal sector through a $1.23 billion adjustment scheme and a $270 million abatement fund.
The adjustment scheme is aimed at providing transitional assistance to the most emissions-intensive coal mines with the allocation of free permits, while the abatement fund will grant money to abatement projects with a priority for electricity generation from waste coal mine gas.
An independent expert review will examine the impact of the CPRS on the sector with the first review scheduled for 2014. The review will draw on analysis from the Productivity Commission and advice from CSIRO on the availability of cost-effective abatement technology.
Mines eligible for the free permits will be those that have fugitive emissions of more than 0.1 tonnes of carbon dioxide equivalent per tonne of saleable coal and those that have carried out coal mining operations for some or all of the years from July 1, 2007, to June 30, 2009.
The government said the permits to be allocated would be equal to around 60% of the fugitive emissions from gassy mines during 2008-09.
Wong said the scheme would allow liability for fugitive emissions for the gassiest mines to be reduced from $20 per tonne of saleable coal to $5/t at a $25 carbon price.
Assistance will be linked to production and capped at base period production levels.
The abatement fund, today boosted by $20 million, means the government will chip in a quarter of the cost of a company’s abatement project.
Today’s deal also includes more than $1 billion to help manufacturing and mining businesses cope with electricity price rises.
In addition, the government will introduce minor technical amendments to remove “all doubt” that fuel exporters, including Australian coal exporters, will not be held liable under the CPRS for the carbon embodied in the fuel they export.
