Sunday, 6 July 2008

Food deals face ban under plan for 'zero waste'

Published Date: 06 July 2008
By Eddie Barnes
Political Editor
SUPERMARKETS could be barred from offering two-for-one deals on perishables ranging from fruit and vegetables to pizzas.
Ministers want a "zero waste" society – and a levy on disposable goods such as razors could also be imposed.Research has proved that shoppers regularly throw away many of the two-for-one products they buy because they go off before they have the chance – or inclination – to eat them.But any move to prevent supermarkets from offering cut-price deals or imposing levies on disposable goods would be inviting the wrath of shoppers, who are already facing huge increases in food costs.A "household waste strategy" to be published this summer will include measures to tackle both two-for-one deals and disposable goods.Officials last night confirmed that the strategy would include "possible legislation" in areas such as "packaging, food waste, and products".Government sources say a ban on supermarkets offering two-for-one deals on perishable goods – such as chickens, pizzas, tomatoes and strawberries – is among the proposals being considered. The deals are blamed for boosting the amount of rubbish going to landfill sites. Officials are also considering whether or not to impose a levy on disposable goods, to encourage shoppers to choose more "sustainable" goods. Razors, cutlery and cameras are likely to fall foul of any such regulations. However, it is understood that disposable nappies will be exempt. The plans are being considered in order to meet ambitious targets set by the Scottish Government to slash the proportion of the nation's rubbish going to landfill from current levels of 50% to just 5% by 2025.By then the Government wants 70% of waste to be either recycled or composted, with the remaining 25% being used to produce energy.The ban on two-for-ones has been prompted by research revealing that one in 10 shoppers in Scotland admit that a quarter of their weekly batch of food ends up in the bin – amounting to some 500,000 tonnes of food waste every year.Environment officials estimate that nearly 30% of all household rubbish is perishable goods which, as it decomposes, gives off methane, a greenhouse gas. Anti-waste campaigners say much of the blame lies with two-for-one deals, which often end up as garbage. Disposable goods are also blamed for adding to the mounting pile of waste. Figures show that thrown-away plastic amounts to 10% of all household waste. Retailers are against any attempt to prevent them from offering discounts, even if they would still be able to offer half-price promotions instead of two-for-one deals.But a ban would be welcomed by many farmers. They claim that supermarkets pressure them into accepting the offers, and they then have to bear the brunt of the costs.The idea of imposing a levy on disposable goods was considered by the previous Holyrood administration but ministers eventually decided the plan was too ambitious.A Scottish Government spokesman said: "The Scottish Government will shortly issue a consultation on possible legislation to help waste reduction and recycling. "It will look closely at what can be done in relation to some key areas, including packaging, food waste and products."Tough new laws on retailers over the amount of packaging waste they generate are also likely to be proposed.Shoppers will be given the legal right to take back any packaging waste to the shop from where they bought an item, with the retailer being required to dispose of it properly.Meanwhile, all businesses and Government authorities may be told to enact a compulsory waste-prevention plan and demonstrate how they are cutting back on the rubbish they produce.

We reap what we sow using crops for biofuels

So biofuels are not such a great idea after all. There is a ferocious debate about the extent to which efforts to promote them are responsible for the rise in world food prices, but it is undeniable that if you have a sharp decline in the supply of a basic food crop such as maize, and even a modest increase in demand, there is liable to be a big effect.
We know that from the oil market, where a small disruption in supply has a huge impact on the price. Some one-third of the US maize crop is now being turned into fuel and therefore taken out of the food supply, so it would be astounding were prices worldwide not to soar. Since maize is such a basic crop, it would be astounding too were it not to pull up the prices of other grains, and of meat as animals are part-fed on grain. The requirement of the EU to incorporate a proportion of biofuel into regular output adds to the pressure. Indeed, were you to try to develop a policy designed to increase the price of food worldwide, this would be about as effective as you could get.
So what should we conclude? Three thoughts.
First, it is too early to try and put hard numbers on the proportion of the rise in food prices that should be attributed to the switch to biofuel. On the other hand, the impact must be substantial and we should be honest with ourselves about that.
The second is to suggest that politicians need to grasp the laws of supply and demand – and the law of unexpected consequences. Well-intentioned people can do a lot of damage if they don't understand economics. It cannot be sensible to subsidise British wine-growers to produce fuel for Prince Charles' Aston Martin. Rationally it is absurd, yet it was presented to the public last week as an environmentally friendly gesture.
Third, we should not dump the idea of biofuels just because our first foray into them has led to a global catastrophe. It should be possible to grow fuel on marginal land and using crops developed for fuel, rather than for food. But it will take time – and honest economics.

Taxpayers to back Sellafield £7bn clean-up

Tim Webb, industrial editor
The Observer,

Sunday July 6, 2008
Taxpayers are being forced to indemnify the winner of the £7.5bn contract to decommission the highly toxic Sellafield nuclear site in Cumbria against an accident because the bidders are based overseas. The preferred consortium will be announced on Friday.
Four consortia are vying for the contract, which could be worth £20bn over its lifetime, including US engineering giants Fluor, Bechtel, Washington Group and CH2M Hill, as well as French nuclear power group Areva and the Japanese firm Toshiba. UK companies Serco and Amec are also members of overseas-led consortia.
Because every country has different laws setting out liability in the event of a nuclear accident, the government has agreed to waive UK rules that require companies to pay the first £140m of clean-up costs.
It is understood that Washington Group recently threatened to walk away after being awarded a much smaller contract to manage an atomic waste dump in nearby Drigg without securing an exemption.
In a document obtained by The Observer, the Nuclear Decommissioning Authority, which is running the Sellafield tender, proposes to indemnify operators against 'claims arising as a result of property damage, damage to human health', 'cost of measures of reinstatement of significantly impaired environment' and 'the cost of preventative measures'. Under the arrangements, the NDA will also compensate operators for the resulting loss of income after an accident, even if it was their fault.
Most European governments have signed up to the Paris and Brussels conventions on nuclear energy. But neither the United States nor Japan is a signatory. Even among European signatories, governments have set different caps on liability for nuclear accidents. While the UK has settled on £140m, others have put the maximum cap for operators as low as £5m. Clean-up costs above these caps are met from public funds.
The NDA says that courts in the home country of a foreign company contracted to clean up Sellafield could challenge UK laws. This is despite the fact that the conventions rule that jurisdiction over the liability for a nuclear accident lies in the country where the incident occurs. Nevertheless, because of the legal uncertainty the NDA warns that there is no commercial cover available for companies. The Treasury has approved the waiver, which will last for 30 years after the Sellafield contract expires.
The NDA, which manages more than half a dozen sites across the UK including Sellafield, has itself obtained insurance on the commercial market. The NDA argues that the benefits of awarding the contract 'outweigh the small risk that this indemnity may be called upon'.

How China’s thirst for oil can save the planet

The pioneers of green energy report a ‘gold rush’ mentality as soaring oil prices speed up the search for alternatives

Richard Woods

At the Lotusengineering works in Norfolk, researchers are working on an idea that seems almost too good to be true: a car that runs on CO2 The very gas that comes out of exhausts and poses the threat of climate change could, they believe, be extracted from the atmosphere and used as a source of synthetic fuel. Hey presto: a carbon-neutral car, planet saved.
From theory to practice is a bumpy road, of course, and Mike Kimberley, chief executive of Group Lotus, readily admits that some alternative fuels “could be more easily implemented than others”. He is optimistic, however, and determined to make Lotus a “world leader in green transport engineering”.
These days even diehard petrolheads know that in the long run there is no choice but to find an alternative to the black gold that has lubricated the world for more than a century. All sorts of initiatives for clean, green and renewable energy are being supercharged by oil prices that hit a new record last week of $146 a barrel – and may well go higher.

Among mainstream analysts, predictions of the price reaching $200 are unexceptional. Last month Gazprom, the Russian oil giant, suggested it would hit $250 next year. The maverick energy guru Robert Hirsch, who forecast the present oil squeeze, has suggested the price could reach $500 a barrel within three to five years.
Gas prices are also soaring and coal, though cheap and plentiful, is one of the worst emissions. sources of CO2 What is bad news for businesses and consumers, however, is good for investors in green energy. Vast sums of money are pouring into technologies that until relatively recently were the preserve of niche businesses and environmental campaigners. This year should see a record £73 billion or more invested in “clean technology” despite the credit crunch, according to a report published last week by the consultants New Energy Finance for the United Nations.
“The green energy gold rush is attracting legions of modern-day prospectors in all parts of the globe,” said Achim Steiner, head of the UN environment programme. Dotcom entrepreneurs, Wall Street financiers and venture capitalists of every hue are piling in.
This 21st-century “green Klondike” stands in stark contrast to the fortunes of ageing icons of the oil age, such as the US carmaker General Motors.
Until recently the biggest vehicle manufacturer in the world, GM is in the middle of an enormous, possibly fatal, slow-motion crash. It has been running low on gas for some time, losing $51 billion in just three years. Last week one of the wheels fell off as it axed four plants that build thirsty sports-utility vehicles and trucks. The company’s outlook is so poor that the investment bank Merrill Lynch has warned that bankruptcy is “not impossible”.
These tectonic shifts are driven in large part by the surging development of China and its 1.3 billion people. While the demand for oil in most western countries has flatlined or even declined over the past 12 months as economic conditions have worsened, in China it is powering away. This demand, and for other commodities, is driving up prices – but also spurring investment in technologies that might unlock a new era of clean, affordable energy.
It prompts several questions: are consumers finally beginning to change their habits? Will alternative energy sources become economically competitive? And could China’s thirst for oil in fact save the planet?
That high oil prices are changing consumers’ habits is clear. In the US the latest figures show that American motorists drove 1.4 billion fewer miles in April than in the same month last year. It was the sixth consecutive monthly drop. Bus and train use has jumped 10-15%.
In Britain similar concern is evident. Petrol sales are down and an AA survey shows that 48% of drivers are considering cutting out short journeys by car and 62% would consider buying a more fuel-efficient model.
Last month Toyota sold its 25,000th Prius in the UK and the hybrid car, powered by petrol and electricity, is in such demand that buyers sometimes face waiting lists, depending on colour and specification. Worldwide, Toyota has sold more than 1m Priuses.
Michael Meacher, the former environment minister, is one of those being spurred into action. His home is heated with oil, and at $146 a barrel it’s time to change. “I looked into wind turbines, which are fashionable, and solar panels, but neither would really work for me,” he said.
“So I’m installing an air-heat pump and a woodchip burner.” The pump will bring heat from the air into his home rather like a fridge in reverse.
Consumer action is also illustrated by Rosemary Randall. Three years ago she founded Cambridge Carbon Footprint, a volunteer group that spreads the message of greener living. It offers to measure people’s carbon footprint for free, explains how to reduce it and advises on deploying renewable energy technologies.
“We are just coming up to measuring our 2,000th carbon footprint, and we think that as a result of coming on our courses people drop their carbon emissions by about a ton a year,” Randall said. “People who come to our groups go on to facilitate other groups. It’s a cascade system.” Juliet Davenport, chief executive of Good Energy, a niche company that supplies consumers with electricity from renewable sources, said: “A lot of people want to be green but haven’t reallyfound it economically necessary.
“I think the urgency is there now. Our website hits are going up 10-15% a month.”
Vital though such local consumer interest is, for renewable energy to become mainstream will require huge investment. That step change now seems under way after funding for “clean tech” surged 60% last year.
Although the credit crunch dented the figures earlier this year, they have rebounded and the UN believes global investment will grow to £225 billiona year by 2012. In Germany, the government believes it will be bigger than the car industry by 2020.
Among those searching for change are the Google billionaires Sergey Brin and Larry Page. Through, a philanthropic arm of the company they founded, they have committed £42m to developing solar and wind power, plug-in hybrid cars and other ideas. One of their aims is to make “RE<C” – shorthand for renewable energy cheaper than coal.
Elon Musk, co-founder of PayPal, the internet payment system, is the driving force behind the Tesla, a high-per-formance sports car powered entirely by electric batteries.
Vinod Khosla, one of the founders of SunMicrosystems, is an advocate of certain types of biofuel as the answer to new energy for cars. And the veteran tycoon T Boone Pickens recently announced a deal with General Electric to build the world’s largest wind farm in the heartland of the US oil industry – Texas.
In the UK the venture capitalist Martin Wright and mechanical engineer Peter Fraenkel are leading the way in tidal power. Their company Marine Current Turbines installed the first commercial-scale tidal power system in the UK and it should start generating this summer. If it works as planned, the company intends to develop an entire “tidal power farm” off the coast of Anglesey by 2012.
For the moment wind power is the favoured technology, since it is proven, simple and enjoys political support. In the longer term solar cells will come to the fore, according to a leading international investment company specialising in clean tech.
“At present wind is cheaper,” said Alexander Rohde, a spokesman based in Switzerland for Good Energies, which has an annual investment budget of £250m. “The question is, over the long run can you make it cheaper than it is? We do not see over 20 to 30 years that there will be technology to bring the cost down. On the other hand, the solar cost per watt is coming down quite steadily.
“In the US they are asking where the next great technology will come from. We are not sure that is needed. The technologies are there in solar and wind – the point now is to get the cost down.”
Jeremy Leggett, a long-standing proponent of solar photo-voltaic power (PV), feels vindication – and despair that the British government is still doing too little. “It’s now inevitable, and I used the word advisedly, that solar electricity is going to be cheaper than electricity from gas and coal,” he said. “It’s straight manufacturing economies of scale, while we all know what is happening to oil and gas.”
Bulky panels that used to be bolted on are giving way to integral thin-film technology. Solar-century, a company founded by Leggett, now supplies some builders with solar tiles that fit seamlessly onto roofs alongside ordinary tiles. “The technology is so efficient now it just needs grey light to work,” said Leggett. “The future can be really different from the way we have done things in the past.”
US researchers are manipulating materials on the nano-scale to keep sunlight “bouncing around” inside solar panels to boost the amount of electricity produced. They reckon this could bring the cost per watt down to about £1 – much closer to the cost of electricity from coal and without the emissions.
So far, however, the UK government has concentrated on wind, at the expense of solar. “The government has just put out a consultation which is supposed to be a green revolution. It’s pretty much all about wind,” said Leggett. “If you look at the figures, they have solar PV producing less than 0.5% of UK primary energy 12 years from now. It’s a catastrophic failure of imagination.”
From tomorrow Gordon Brown and leaders of the other main nations will gather in Tokyo for a G8 summit. On the agenda are oil and food prices, and climate change. Though many observers would like to see an agreement to cut carbon emissions by 50% of their 1990 level by 2050, the scale of the challenge is enormous.
At present renewable energy sources make up just 1% of the world’s primary energy consumption; gas accounts for 21%, coal 25% and oil is the single biggest energy source at 35%.
When it comes to electricity, 40% is produced from coal and a further 20% from gas; hydro power produces 16% and nuclear 16%; renewables again account for just 1%.
To escape our reliance on oil and to create energy that is clean will require more than the endeavour of private investors and individuals. It needs political courage.
Lord Browne, European managing partner of the Carlyle investment group and former chief executive of BP, recently argued that the necessary knowledge and skills are available, but one other factor is key, he said: “It is one thing to know what needs to be done and quite another for the details of those policies to be worked out, enacted and enforced.
“Getting from the former to the latter requires political leadership. I believe this remains today’s determining step.”
There is an added motivation for western politicians. The spike in oil prices is handing yet more power to oil-producing nations, some of them hostile.
To reduce the dependence on these countries is becoming more of a geopolitical priority.
Innovators, investors and entrepreneurs are optimistic change can be achieved with political backing. Michael Liebreich, chairman and chief executive of New Energy Finance, said: “The high oil and gas prices are certainly helping to drive that investment, but investors are still looking for stronger signals on policy because they worry about what will happen if, or when, the prices recede.”
In the right political environment, even hard-nosed bean counters are optimistic. A report by Price Waterhouse Coopers last week reckoned the change to a low-carbon future can be achieved by 2050 at the cost of “one year of global GDP growth . . . ie, reaching the same level of GDP in 2051 as might otherwise have happened in 2050”.
It seems a modest price to pay for what Liebreich calls “nothing less than the complete restructuring of the world’s energy industry”. Are you listening, Mr Brown?
WHO IS HE? Social entrepreneur, author, geologist and former oil industry consultant
WHAT IS HE DOING? Leggett is founder and chairman of Solarcentury, which is the UK’s largest independent company specialising in harvesting the power of the sun. He argues the local micro-generation of solar power will be the best way to combat climate change and declining oil production in the long term
WHAT IS THE PROBLEM? The capital costs are still expensive for householders. Installing a small-scale system may cost £2,000, larger ones more than £10,000
DOES HE HAVE AN ANSWER? Costs are falling, while fossil fuel energy is growing more expensive. The two will one day cross over. “These technologies are not called renewable for nothing,” he said. “Once people have found a way round the capital cost, that’s it; it’s free electricity.” Solar technology is advancing rapidly. Cells can now be made wafer-thin and printed on aluminium foil. They can then be “wrapped” on almost any object. American manufacturers claim it will halve the costs of producing solar cells. Nanotechnology is also being used to bounce the sun’s rays around the cells, so less energy is lost
WHO IS SHE? Chief executive, Good Energy, a green power supply firm, and one of the Sunday Times 50 Best Green Companies 2008
WHAT IS SHE DOING? Providing the firm’s 20,000 consumers with electricity from 100% renewable sources. Trying to simplify the fragmented process of creating and using renewable energy. “It’s a bit bitty at the moment – we’re trying to make it more straightforward for consumers,” she said. “We will see some step changes, not necessarily in anything brand new, but in existing technology. We will see a breakthrough on solar”
WHAT IS THE PROBLEM? Finding sources of renewable energy is a competitive business and generators are scattered all over the place. Good Energy has about 450 suppliers, from a factory with its own wind turbine to householders with just a few solar cells on their roof
DOES SHE HAVE AN ANSWER? Like other similar companies Good Energy pays people who generate renewable energy – even if they use that energy themselves. As that message spreads, more people will see the benefit of generating renewable power. “The interest in this area, where people can do it themselves, is increasing,” said Davenport. “We are seeing hits on our website go up by 10 to 15% a month”
WHO IS HE? Silicon Valley billionaire who was a co-founder of computing giant Sun Microsystems. Now a venture capitalist
WHAT IS HE DOING? Investing in biofuels. He argues the only realistic competitor to petrol for cars in the next 20 years will be a biofuel called cellulosic ethanol. “We face an energy crisis, an environmental crisis and a terrorism crisis all related to oil,” he said. “Hybrid and electric cars sound good, but are unlikely to materially reduce carbon emissions . . . The only cost-effective option likely to achieve market acceptance in the next 20 years is cellulosic-fuel cars”
WHAT IS THE PROBLEM? An unpublished study by the World Bank concludes that biofuels have been one of the main reasons behind the global rise in food prices as farmers switch crops diminishing stocks of wheat, maize and other staples. Critics complain Khosla is cashing in on subsidies for biofuels
DOES HE HAVE AN ANSWER? Khosla argues cellulosic ethanol can be made from agricultural waste, municipal organic waste and sewage without taking up land used for food production. Suitable biofuel crops could also be grown on land otherwise left idle in winter
WHO IS HE? Billionaire former oil tycoon who was a corporate raider in the 1980s and is now an investor
WHAT IS HE DOING? Pouring a fortune into wind power. “I have the same feelings about wind,” he said earlier this year, “as I do about the best oil field I ever found.” Pickens recently ordered 667 turbines from General Electric, the first batch of more than 2,000 he plans for the world’s biggest wind farm in Texas. When complete, the $10 billion project should produce 4,000 megawatts of power – about the same as the Drax coal-fired power station, which provides 7% of the UK’s electricity
WHAT IS THE PROBLEM? Turbines still suffer from being at the mercy of whether the wind blows or not. And wind-generated electricity relies on government subsidy to be competitive
DOES HE HAVE AN ANSWER? Technological advances now enable turbines to operate in a wider range of conditions, thus lowering costs. However, wind energy remains more expensive than electricity from gas or coal
WHO IS HE? Multi-millionaire entrepreneur and co-founder of Paypal, the popular internet payment system
WHAT IS HE DOING? Building a high-performance electric car. Musk raised more than £50m to fund the development of the Tesla, a battery-powered sports car being put together by Lotus. It boasts sports car acceleration and style. At its launch earlier this year, Musk declared: “This is the culmination of an enormous amount of work”
WHAT IS THE PROBLEM? Production has run behind schedule. And apart from the £50,000 price tag, the Tesla, like all battery cars, has limited range. And if you run out of power, you can’t fill up quickly like you can with petrol
DOES HE HAVE AN ANSWER? Researchers are experimenting with new types of battery materials, some tweaked by nano-engineering. The most promising may be able to recharge in minutes, rather than hours. Last week Musk predicted that within 30 years the majority of cars produced in American would be plug-in electric

Prospects dim for G8 climate change deal

Sunday July 6 2008

By Linda Sieg and Chisa Fujioka
TOYAKO, Japan, July 6 (Reuters) - Prospects that the G8 would reach a meaningful agreement to fight global warming at their annual summit dimmed on Sunday as leaders began arriving in northern Japan with a raft of global problems on their minds.
Climate change is high on the agenda of the July 7-9 summit of rich nations at a luxury hotel in Toyako, Hokkaido, and of a Major Economies Meeting on July 9 that brings the G8 together with eight other countries including China, India and Brazil.
Global inflation driven by soaring food and fuel prices, African poverty and the continuing effects of the credit crisis are also on the G8 agenda, as are foreign policy issues as wide-ranging as Zimbabwe's election crisis to progress in dismantling North Korea's nuclear programme.
Japanese Prime Minister Yasuo Fukuda, who arrived in Hokkaido needing a successful summit to bolster limp ratings, wants to add to momentum for U.N.-led talks on a new framework beyond limits agreed under the Kyoto Protocol, which expire in 2012.
Those negotiations are due to conclude in Copenhagen in December next year.
But wide gaps among Group of Eight members and between advanced and developing countries have raised doubts about the chances for progress beyond last year's summit in Germany, where leaders agreed to "seriously consider" a global goal of halving greenhouse gas emissions by 2050.
"I don't think we're expecting a deal. That will come under the United Nations' auspices in Copenhagen next year," Canada Environment Minister John Baird told reporters en route to Japan.
"What we hope is that we can get some momentum toward a solid progress on climate change."
The G8 comprises Britain, France, Germany, Italy, Japan, Russia, Canada and the United States.
Activists and the European Union want the G8 to agree to the 2050 goal discussed in Germany and set 1990 as the base year, and say advanced nations should set their own firm mid-term goals for reductions by 2020.
Japan wants the leaders to agree to the 2050 goal but without specifying a base year.
U.S. President George W. Bush insists Washington will only set targets if big emerging economies such as China are on board as well.
Analysts and diplomats have said that the G8 leaders were likely to craft a fuzzy agreement on a long-term goal to allow Fukuda to save face, but that real progress will likely have to wait until a new U.S. president takes office in January.
"Both advanced and developing countries are close to an agreement on the long-term target," Japanese Environment Minister Ichiro Kamoshita told NHK public TV.
"China and India were not against the idea at the environment ministers meeting. We now want the United States to make a firm commitment and take a step forward at the summit."
Climate experts want advanced countries to commit to reducing emissions by 25-40 percent by 2020. Tokyo and Washington say specific interim targets are not on the table in Hokkaido, although a statement to be issued at the end is likely to acknowledge the need for advanced countries to set them.
"Mid-term targets will ultimately be decided at Copenhagen next year," Kamoshita said. "We need to be prepared (to set a target), but it's a matter of national interest whether we need to set a target before other countries."
But a deal that falls short of mid-term targets is unlikely to satisfy either environmentalists or Fukuda's domestic critics, who say Tokyo should at least come up with a figure of its own.
"It's hard to understand why Japan is not setting a mid-term target," said Katsuya Okada, the opposition Democratic Party's point man on climate change. "There's no reason to be hold back because of the United States."
With the attendance of several African leaders, this is the largest gathering since the event began more than three decades ago at the Chateau de Rambouillet outside Paris in November 1975 to discuss the oil crisis and a world recession.
Some charge that the summit, which draws huge media coverage, countless activists and sometimes violent protests, has got out of hand. Twenty two leaders will be in Hokkaido.
"The first summit was a very small affair. They got in a room, said they were facing a crisis, did a little horse trading and came up with a plan," said Robert Feldman, chief economist at Morgan Stanley in Tokyo.
"It has become something of a carnival ... and got away from the original intent, which was to sit in a room together -- the human side of negotiating and getting things done," Feldman said.
"It's unwieldy and it's not leading to a lot of results." (Editing by Sonya Hepinstall)

Australia PM says committed to carbon trade schedule

Sunday July 6 2008

PERTH, July 6 (Reuters) - Australia Prime Minister Kevin Rudd said on Sunday he saw no case for delaying the startup of a carbon trading scheme beyond 2010, adding that the Reserve Bank saw no inflationary pressure arising from the scheme.
Australia's left-leaning Labor government has promised to introduce a national carbon trading scheme by 2010 in order to curb Greenhouse gas emissions. But the Opposition has expressed scepticism at the timeframe and has asked for delays. "Our ambitions remains the 2010 timeframe. We don't believe that there is a case for delay," Rudd told ABC television.
"And part of the reason is because time for Australia is running out, and we can't keep putting these things off."
Australia, the world's top per-head greenhouse gas polluter, laid out a blueprint on Friday for slashing its impact, with the government's top climate guru unveiling a draft trading system to fight carbon emissions.
Respected economist Ross Garnaut, appointed by the government to design what will be the world's most extensive emissions regime from 2010, urged inclusion of energy and transport, but said big corporates whose foreign rivals are free to pollute should be mollified with compensation.
The prospect of emissions limits on road transport and electricity generation has raised fears of higher fuel and power prices at a time when polls show rising living costs are already eating into government popularity.
But Rudd said the Reserve Bank has said the carbon emissions scheme would not put inflationary pressures on the economy.
"The governor of the Reserve Bank, when asked about this a few months ago, had dictated then that he did not see an inflationary impact arising from this scheme," Rudd said.
"But we need to ensure that we give proper powers to competition watchdog the ACCC (Australian Competition and Consumer Commission) to make sure that there is no opportunistic price gouging during that period as well."
Under Garnaut's proposals, businesses that pump out less greenhouse gas than their allowable limit would receive credits and be able to sell permits bought at competitive auction to pollute to firms exceeding their carbon emissions quota. (Reporting by Fayen Wong; Editing by Jerry Norton)

Public ‘misled’ over Heathrow pollution

Jon Ungoed-Thomas

The government’s adviser on air quality has warned that ministers are “pulling the wool” over the public’s eyes to justify building a third runway at Heathrow.
Mike Pilling, who chairs the government’s expert group on air quality, said the public were being misled over claims that Heathrow’s expansion would not cause unlawful and dangerous levels of pollution.
His comments came as it emerged that Ruth Kelly, the transport secretary, has been forced by the scale of the public backlash to postpone her decision on expansion. It was due this summer, but sections of it are now likely to be rewritten.
This weekend the National Trust also came out in opposition to the expansion proposal and to plans by Nats, the air traffic service, to redraw flight routes across the country to ease congestion.

Pilling, who helped to devise the Department for Transport’s rubric for measuring future pollution around Heathrow, said a key recommendation to consider a range of future scenarios was disregarded. He said Kelly’s final conclusion that a third runway would not cause a significant increase in pollution was unreliable.
Kelly had previously pledged that the airport would be expanded only if it did not breach European Union pollution limits. “They mustn’t pull the wool over our eyes,” Pilling said last week. “People are much more sophisticated than that. They [the transport department] need to go back and do some more calculations.”
The government has based its predictions about the impact of expanding Heathrow on a set of optimistic assumptions, including the arrival of cleaner engines. Pilling says that the more pessimistic scenarios were not tested.
“Those residents [who live near the airport] should say, ‘I’m not convinced because you have not looked at all the possible changes that might happen in the future’,” Pilling said.
“They [the department] claim it’s clear that there won’t be pollution [overruns] but they need to spend more time to show there is a very strong chance that this is the case.”
His comments come after a Sunday Times investigation revealed how the transport department and BAA, the airports operator, collaborated to “fix” the environmental figures by selecting the data most likely to get a positive result.
The comments made by Pilling, who is professor of physical chemistry at Leeds University, reinforce concerns raised by the Environment Agency, which has warned that the department’s case is not “sufficiently robust” to conclude that pollution levels will not breach the legal limits set by the EU.
The agency said that more consideration should have been given to variations in traffic emissions, background air quality and climate change.
Kelly is facing protests not just over plans for Heathrow’s expansion but also about her entire aviation policy, with the National Trust warning this weekend that plans to redesign air routes to ease congestion threaten to spoil some of England’s most tranquil areas, including the Chilterns.
Nats has tried to divert some flightpaths from urban to less populated areas, but Tony Burton, the National Trust’s director of stategy and policy, said his organisation opposed the plans because of the impact on some of its properties and the damage to people’s enjoyment of the countryside. One new route out of Luton airport will mean more planes flying over the Chilterns at lower levels.
Under the plans, four new holding stacks are being created to serve Stansted, Luton and London City airports. Some routes are also being changed from Heathrow, with local councils saying that 40,000 more residents will be affected by extra aircraft noise.
The government faces pressure to review both the proposals for a change in air traffic routes and for Heathrow expansion. Serge Lourie, leader of Richmond council and spokesman for the group of councils opposing expansion, said: “The Heathrow consultation has been botched from start to finish. It is an utter disgrace.
“If they are now going to start rewriting the impact assessment, then we deserve a new consultation and not the sham we’ve seen, in which the transport secretary announced in advance that she wanted Heathrow expansion.”