King Coal set could upset Rudd’s apple cart in Australian climate vote

US coal giant Peabody Energy Corp has expressed fears that the Australian ETS scheme would hit investments in coal mining and force closure of mines. Australian lawmakers are to vote on a government proposed scheme on Thursday that will introduce carbon trading in July 2011. The company has extensive operations in Australia.

The government plan faces almost certain rejection in the parliament on Thursday, but the proceedings are being closely watched around the world with the global climate talks scheduled for December in Copenhagen.

Australia is the world's leading exporter of coal, but the coal industry has been offered only $750 million in compensation rather than ongoing free carbon permits the industry has demanded.

The government wants its ETS laws passed ahead of Copenhagen which will commit the country to cut emissions by a minimum 5 per cent or up to 25 per cent if an international agreement is reached to take stronger action.

The government needs an extra seven votes to pass the laws with the opposition, Greens and independents having opposed the current scheme.

Boyce has urged for reconsideration of how the coal industry would be treated under the ETS and has called for changing the current plan. He said that from a coal perspective, the industry would say the plan is inadequate to produce a healthy industry going forward.