Since Australia has pledged to reduce its greenhouse emissions by 5% to 15% by 2020, it unveiled the world’s broadest carbon trading scheme several days ago, turning out business calls for a delay due to the global slowdown.

While Australia is now second only to the European Union in its drive to cut emissions by establishing a cap-and-trade system that puts a price on carbon output, it was said that the target is far from powerfulness and blasted the trading plan that will give free credits to some of the economy’s most carbon-intensive industries.

According to Prime Minister Kevin Rudd, it is essential to implement carbon scheme in Australia, which has the fourth-highest per-capita greenhouse gas emissions in the world, and five times more per person than China, due to its reliance on coal for electricity.

Because of no action on climate change, Australia is going to face a series of problems brought by the worsening climate.

But some carbon market participants thought the unveiled system still had a long way to go if it wants to be satisfactory.

And the government said Australia would only target the full 15 percent cutback if a global deal emerges from UN talks in Copenhagen in late 2009, angering environmentalists who had hoped Rudd would follow through on his green electoral mandate by taking a leading role in cutting global emissions.

Greenpeace climate campaigner John Hepburn said the scheme is madness and totally a failure and the climate change is happening much faster than people thought.

The plan is called a “polluters” paradise by Friends of the Earth.

Scientists and green groups wanted cuts of at least 25% but the scheme can’t get to the standard absolutely.

The reduction of Australia’s target is far from 20% that Europe has promise and the UN’s Intergovernmental Panel on Climate Change recommendation of up to 40 percent by then. And the challenge is to find a successor to the Kyoto Protocol in the next 12 months.

Rudd defended the targets by saying they were more aggressive on a per-capita basis than those in the European Union.

The government also said that the scheme would only cut about 0.1% off annual growth in total national product from 2010 to 2050, with a one-off increase in inflation of around 1.1%.

Gary Cox, head of environmental derivatives at global brokers Newedge said economy is more important than environment when we have to choose one.

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Australia, Canberra, carbon, China, economy, plan