Taylor flies out of Madrid, leaving Kyoto carryover battle unresolved

Federal energy and emissions reduction minister Angus Taylor has left Madrid following his address to the COP25 climate change talks, leaving Australia’s diplomatic corps to continue the fight for Australia’s Kyoto accounting loophole.

Much is at stake for the Morrison government, as it plans to rely on the accounting loophole to represent almost all of the federal government’s actions towards meeting its 2030 emissions reduction target. If the loophole is successfully blocked by other countries, it will blow a 411 million tonne hole in Australia’s emissions budget.

Taylor will primarily rely on the Ambassador for the Environment, Jamie Isbister, who is attending the UN climate talks in that role for the first time. Isbister will be backed by a diminished team of Australian diplomats to ensure Australia has access to carryover Kyoto units, which will likely be the Australian delegation’s core priority for the remainder of the talks, that are expected to run into the weekend.

New Zealand and South Africa have been called in to mediate an outcome on the issue, with New Zealand climate change minister James Shaw, a Green, telling the conference that he hopes to have a propose solution by Friday evening Australian time.

Shaw said that parties had shown agreement to both a “mutually acceptable outcome” as well as a “commitment to environmental integrity”, suggesting a compromise may be in the works.

The issue of the Kyoto carryover has emerged as one of the key sticking points at the talks and there is also growing speculation that a resolution may not be reached in Madrid, if countries like Australia continue to hold out for their preferred position.

The issue was meant to be resolved last week when negotiators split off into various “subsidiary” groups to deal with matters in fine detail, but with mutually agreeable outcome yet to be reached, the matter may be referred to the full plenary for a final decision, at which point the stakes are raised.

At the 2012 round of climate talks held in Qatar, the protestations of Russia during the closing plenary, also over a Kyoto carryover issue, were effectively ignored by other negotiators. The issue caused a minor diplomatic incident, which Russian negotiators described as an “an outrageous violation”.

Prime minister Scott Morrison claimed on Thursday that the battle in Madrid of the Kyoto carryover wasn’t relevant to Australia’s circumstances, saying that the dispute related only to carbon permits that were “traded” and did not relate to the permits Australia seeks to use to meet its 2030 target.

“The issue of carryover credits that’s been discussed in Madrid has actually been about trading credits with other nations, old credits. And that is the issue that concern has been expressed about in Madrid and that does not apply to what Australia’s practice is,” Morrison told a press conference in Melbourne.

However, based on the most recent version of the draft text under negotiation at the talks, Morrison’s suggestion is clearly untrue. While there is a question over the carryover of traded units, which is more relevant to the circumstances of Brazil, Russia and the Ukraine, a group of around 100 countries are also attempting to block Australia’s use of its own surplus units.

“While there is some compromise to the restriction to allow some Kyoto credits to carry forward to the Paris Agreement, it does not include the type of credits that Australia is heavily banking on,” former Australian negotiator Richie Merzian said, who is observing the talks on behalf of the Australian Institute.

“Australia has very little diplomatic capital to call on and received another fossil of the day award for its persistent and baseless lobbying to reduce its climate action through the use of hollow Kyoto credits.”

Morrison also sought to dismiss a report from European think tank Germanwatch, that gave Australia a score of zero for its national and international climate policies.

Morrison dismissed the conclusion of the Germanwatch report.

“I completely reject that report. We don’t accept that… because I don’t think it’s credible,” Morrison said.

In the latest version of its Climate Change Performance Index, the Germanwatch report ranked Australia last of 57 countries, including below the United States, saying that Australia had become a “regressive force” at international talks on climate action.

“Minister Angus Taylor arrived earlier this week to a chorus of about 100 countries urging Australia to cease using creative accounting – specifically the use of ‘carry over’ credits from the Kyoto period – to meet its already woefully inadequate emissions reduction targets,” Oxfam Australia’s Climate Change Advisor Dr Simon Bradshaw said.

“In doing so, Australia is not only shirking its own responsibility but equally encouraging other countries to weaken their efforts. It beggars belief that Australia – a country with more to lose than any other developed country from lack of climate action – would seek to undermine international cooperation and the spirit of the Paris Agreement in this way.”

“The irony of Australia continuing to dig in its heels while our east coast is going up in flames and Sydney is blanketed by smoke has not been lost on those in Madrid. There is a perception that climate policy in Australia – which was ranked the worst in the world by this week’s Climate Change Performance Index – has become totally disconnected from reality. Self-defeating for Australia, just as it is dangerous for the world at large,” Bradshaw added.