A federal backflip on the environment gives Victoria a chance to lead.
It was a bad day for the Brumby government when Kevin Rudd dumped ''the greatest moral challenge'' from his priority to-do list. The Victorians uttered not one harsh word in public, but privately, they seethed. The state's climate change agenda was hitched to the federal emissions trading scheme. Now that agenda is in disarray.
Several years ago, the state government made a strategic decision about climate change. It recognised that the promised carbon scheme, if well designed, would be more effective at cutting pollution than any state reforms. So it put on hold its election promises and policy architecture – a future energy statement, a climate change bill and white paper – until the scheme passed federal parliament.
This was a pragmatic decision, but also politically convenient. The heat over Victoria's notoriously dirty power sector came off John Brumby and landed on the Prime Minister. The downside? The state's climate change policy went into a deep freeze. At one point, the fashionable view in the bureaucracy held that the state had no role in cutting greenhouse gases, only in helping the community adapt. As one Labor insider told The Sunday Age last week, waiting for a carbon price was a bit like Waiting for Godot: both never came and the void was filled with talk and no action.
Now, seven months from an election, Brumby has re-inherited the climate problem, but it is bigger and uglier now. In a year in which he must polish his green credentials to impress voters in marginal inner-city seats, senior state government sources now admit Rudd has damaged Labor's brand on climate change. Also, Labor has to rewrite large chunks of its policies – now years late – that were based on a working federal carbon scheme (the state budget was also wrong-footed by Rudd's decision: it had little climate spending).
But the biggest issue for Brumby is Hazelwood, a 45-year-old brown-coal-fired power station in Gippsland. An effective emissions trading scheme – and it is not clear Rudd's was – would have dealt with Hazelwood, Australia's most polluting electricity generator. A decent price on carbon pollution would have made Hazelwood much less profitable and its owner, International Power, would have received millions in compensation to ease it through a phase-down.
In the absence of the scheme, however, the environment movement has Brumby in its sights. Environment Victoria has called on the major parties to replace Hazelwood with renewable energy, energy efficiency and gas. A campaign on Hazelwood is to the 2010 election what old-growth forests were in 2006: the central ''ask'' of the green movement.