Those MPs working behind the scenes and talking climate compromise include Ley’s right-hand man Alex Hawke, leading moderates such as Tim Wilson and Andrew Bragg, and conservative-leaning MPs such as James Paterson, Claire Chandler and Simon Kennedy (as my colleague Paul Sakkal first reported earlier this month).
There is even some hope that the bare bones of a policy compromise can be worked out by the time parliament returns in October and a divided party room meets again.
The compromises, which could include removing the net zero goal from law, exempting parts of agriculture from the target, getting more gas online and pushing back the net zero date from 2050, would be controversial.
As one MP familiar with the pragmatists’ discussions, who asked not to be named, put it, “there has to be a showdown when we get back to parliament. We need a position by the time parliament returns. I’m confident we will actually be able to land it [a compromise on climate policy]. It’s not 2013 [when Tony Abbott won the election by campaigning against the carbon price]; we can’t just be against something. That was a simple deliverable outcome, ‘axe the tax’. But just arguing ‘vote for us to end net zero’ is not going to win us the next election”.
Hastie sounded almost messianic on ABC Radio Perth as he explained why he would quit shadow cabinet if the Coalition kept its support for net zero. He outlined an alternative policy he believed should be pursued – making Australia an energy superpower, with cheaper electricity to boot.
A more nuanced argument is now being put publicly by MPs such as Wilson and Kennedy too. Wilson argues, for example, that he supports net zero prices, net zero power outages and then “people are quite relaxed about net zero emissions if you get the first two”.
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In other words, Wilson wants the party to figure out how to come up with an energy policy the party room actually wants and then work back from there towards emissions reduction.
Compromise carries risks for Ley, though, not the least of which is that it may not go far enough for MPs such as Hastie and Canavan, and could trigger a split in the opposition parties again.
Conversely, there is an electoral risk for the opposition that voters will be turned off by a party that could be seen to be walking away from addressing greenhouse gas emissions.
The opposition leader tried to drag the focus back to Labor’s plan and away from her own problems on Thursday and there is plenty to be concerned about in the policy documents. It will cost hundreds of billions to achieve a 62 per cent to 70 per cent cut by 2035. (Of course, advocates will argue that the cost of inaction would be far higher.)
Consider some of the headline points from the Climate Change Authority’s work. Half of all cars sold between now and 2035 will need to be EVs; industry and resources sector emissions will have to come down by about a third; a six-fold increase in energy storage, doubling of rooftop solar, tripling of utility-scale solar and a quadrupling of wind capacity will be needed.
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Australia’s emissions reduction targets need to accelerate from 7Mt (megatonnes) in 2024-25 to 19-24Mt per year to meet the 2035 target. The Labor catch cry is “ambitious but achievable” and Treasury modelling suggests under a so-called baseline emissions reduction scenario, Australia’s economy will be $2.2 trillion larger by 2050, GDP per capita will be $36,000 higher and more. It all sounds a bit Utopian.
Delivering the emissions cuts required will pose huge challenges for Labor, with questions about what kind of baseload power is best, whether Australians will accept wind and solar power being scaled up to the level required, and will that many people buy an EV, and has the age of affordable battery storage actually arrived yet?
The 2035 target is designed to claim the political middle ground for Labor, disappoint some environment and business groups – but not too much – and push a divided Coalition to the political fringes while it begins the hard work of keeping the public onside as the cost of the economic transition rises.
Ley just needs her allies and her enemies within to end the interminable climate wars, so she can apply the blowtorch to Labor.
James Massola is chief political commentator for The Sydney Morning Herald and The Age.
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