By Philip Hopkins
AUSTRALIA'S shipping industry has accused the Government of undermining the sector through a double cost impost in its proposed emissions trading scheme (ETS).
The Australian Shipowners Association said the ETS, outlined in the green paper last week, excluded international shipping and provided support only to road transport.
"This will impose a double-barrelled cost disadvantage on coastal shipping," said ASA executive director Teresa Hatch.
"How is it possible that two ships are sitting side by side in a port loading cargo, they sail together and unload at another Australian port, and only one of them is included in the scheme?"
Ms Hatch said the domestic industry was being asked to compete with international businesses that did not yet pay a price for carbon. "But we're being asked to compete with them in our own backyard," she said.
Australia's ships carry the minerals and liquids that are helping drive the commodities boom. ASA members include BHP Billiton, BlueScope Steel. BP Australia, Caltex Australia and ANL Containers.
About 30% of Australia's domestic sea freight is carried on international vessels; Ms Hatch said this equated to more than 15 million tonnes of domestic cargo that would not be subject to extra costs on carbon emissions. International ships are registered in various locations around the world and are not subject to any trading scheme.
The ETS will cut fuel taxes to compensate motorists for the carbon price for three years after the ETS starts in 2010. For heavy vehicle road users in the freight sector, this measure will last only one year.
Qantas chief Geoff Dixon has warned that domestic air fares will rise and tourism shackled unless the aviation industry is given free permits under the ETS.
Rail has also joined the critics. Bryan Nye, chief executive of the Australasian Railway Association, said the ETS completely ignored the rail industry and its environmental benefits. Instead, offsets for road use would increase the cost of rail passenger and freight transport.
Mr Nye said, for example, rail now carried only 7% of freight along the Sydney-Melbourne corridor, with the rest going by road. "Despite rail's acknowledged significant energy and environmental advantage over road transport, where one train takes 150 trucks off the road, saves 45,000 litres of diesel and saves 44 tonnes of greenhouse gas emissions, rail will pay under the scheme, but road transport will be fully compensated," he said.
Mr Nye said the proposed scheme offered a vague hope that railways would be considered as a "strongly affected industry" as it would meet all the proposed criteria. Assistance may also be available to rail under the Climate Change Action Fund.
"However, there is no certainty that either of these will be applied to railways," he said.