10%? 5%? 15%? 25 or 40%? Off 1990 or 2000? Groundhog Day? Is the Government going to wimp it? And where is Poznan anyway?

I’m willing at this point to be heretical and declare that the emissions target doesn’t matter a great deal. As long as the price of carbon will continually rise under an Australian emissions trading scheme, and as long as Australia indicates its willingness to make deep cuts in emissions in the context of an international agreement, a soft start doesn’t matter a great deal, nor does a weak 2020 target.

Targets can be adjusted upward. In fact, the Government’s “gateway” approach to targeting in the Green Paper allows for upward revisions of the emissions cap within a limited band. Over a longer period, the target itself can be lowered, moving us onto a more rapid path of reductions. Given how unlikely it is that Copenhagen will yield a decent international agreement, we can always hope that a future agreement is struck, and lift our target to match it.

And yes, delaying action means it costs more to reduce emissions later, but given the likely economic circumstances of 2010, that trade-off might be an acceptable one for now.

What does matter is the design of the scheme, and this is where it looks as if the Government will seriously undermine the effectiveness of an emissions trading scheme, particularly in compensating heavy polluters with free permits. Speculation has centred on a third tier of compensation for firms just under the Government’s arbitrary compensation threshold of 1,500t per million dollars revenue. This would drive the ETS even further toward an almost notional activity, with polluters collecting pieces of paper and no one but low-emission firms and their customers paying for carbon permits.

With such a scheme, it doesn’t matter what the target is, there’ll be no incentive for polluters to change their behaviour or invest in more efficient or lower-intensity equipment. The whole exercise will be a waste of time.

The process of “refining” the Green Paper ETS model has been one conducted by the Government in close consultation with polluters, who have been given ample opportunity to state their claims — frequently backed up by half-baked “modelling” from economists-for-hire. The flight of industry to non-ETS jurisdictions has been repeatedly threatened, despite the lack of evidence that ETS-related costs will be high enough to overcome all other commercial factors in such a decision. Environmental groups and businesses in favour of strong action to address climate change have had limited opportunity to directly respond on the Government’s proposal and push for a more efficient and effective scheme.

The result seems likely to be a weak, ineffective ETS that minimises any inconvenience to our biggest polluters. One the Government can show voters to demonstrate its commitment to addressing climate change, despite its lack of impact.

All the debate about the target is a sideshow. The target doesn’t matter a great deal, provided we’re willing to play a strong role in an international agreement. The design of the scheme is the real issue, and the key to whether it will achieve anything, regardless of what target we set for ourselves. Barring a surprise next Monday, it looks like we’ll get a scheme that’s barely worth the carbon used to produce it.