New York City, April 12, 2005

PART I - THE NEW ZEALAND - AUSTRALIA COOPERATION:
In November 2004 the New Zealand Government, under the leadership of
the
Minister of Trade, Minister of Industry, Minister of Energy, The
Honorable
Prof. Pete Hodgson, who is in addition also the Convenor of NZ’s
Ministerial
Group on Climate Change, arranged for a conference to bring together
Australian and New Zealand companies with interest to participate in KP
Clean Development Mechanism (CDM) projects.

New Zealand has ratified the KP but has no obligations regarding needed
decrease of CO2 emissions below the 1990 level. Australia, like the US
did
not ratify the KP and thus has also no obligations regarding the KP -
and
this has now come to haunt Australian entrepreneurs that would like to
participate in the business aspect of the KP devised CDM program. It
is
now, in anticipation of the business to be generated by the KP, that
the
interest of part of the business establishment in Australia, was seen
by
business and government in New Zealand, as a way to pry Australia away
from
domination by the US and into the fold of the EU and Japan led KP
process.
Australia is the larger economy when compared to NZ - so the attempt to
generate joint activities in countries like China and India, via the NZ
KP
membership. Further, thanks to free trade agreements with the US,
this
partnership could then lead also to involvement by US business despite
the
fact that the US is also a non-participant in the KP process.

The November meeting was after the KP ratification by Russia. Since
then
the KP entered into effect this February 16, and the Australian
Environment
Minister Senator Ian Campbell invited Prof. Hodgson, to Sydney, for a
day-long closed forum with about 100 business leaders from Australia
and New
Zealand on April 8, 2005. On the face of it - Senator Campbell said
that
“we need an effective global response to climate change and Australia
has
committed to playing a leadership role in this process”. To the
Australian
business people he said that they will not be disadvantaged by
Australia’s
non-participation in the KP process. In effect, what is happening, is
that
Aussies are now looking for backdoor channels around the ban on
countries
that have not ratified the KP. According to “The Australian”, Martin
Wilder, from Sidney law firm Baker McKenzie, said a dozen Australian
companies are already using backdoor means, such as joint ventures, to
participate in the CDM.

The meeting was divided into a morning “Leaders Roundtable” with
Ministers,
CEOs, and other senior participants, and an after-noon larger gathering
with
a broader group of policymakers, stakeholders, and experts. The
afternoon
crowd included Pew Center President Eileen Claussen from the US,
Catherine
Beard of the Greenhouse Policy Coalition representing NZ largest
employers
and energy users on matters relating to GHG issues, Gregg Bourne of the
World Wildlife Fund - an environmental NGO, Mitchell Hooke of the
Minerals
Council of Australia, Heather Ridout of The Australian Industry Group,
and
Ralph Sims of Massey University - a scientist with long involvement in
alternate fuels such as renewables from Biomass.

To attest to the seriousness of this effort - let us mention the case
of the
Christchurch City Council (the South Island of NZ) has been awarded on
April
1, 2005, 200,000 emissions credits under the KP for collecting methane
gas
from a landfill site to fire the boilers at the QE2 swimming pool.
Sale of
these credits at the present international price of $15 will net
Christchurch $3 million. to help pay for the investment.

Australia’s example is the launching of a dual-fuel Caterpillar C15
engine
that will save 8% in GHG emissions. The development by a US company
was
funded by Australia. This engine could then generate credits when
introduced, as an example, to China.

Further, Australia and NZ will now try to help lead the process of
aiming at
the post-Kyoto period and the inclusion of Australia, the US, and such
economic competitors as China and India.

PART II - AUSTRALIA PROPER.
To be more accurate, I am compelled to enlarge on this article.

a. Had Australia ratified the KP, it would have been allowed to emit
8%
above its 1990 level of CO2 emissions, but the federal government,
under
Prime Minister John Howard, has chosen to follow the example of the
Bush
administration of the US and refuse to go along saying that the
evidence of
a human impact on global warming was not conclusive yet.

b. Like in the US were a dozen States are, independently of the
federal
government, looking at following the EU example - the private sector
Chicago Climate Exchange is trying to start trading CO2 credits - so
some
major Australian States - NSW, Victoria, and Queensland, are trying to
develop their own scheme to regulate GHG emissions. Interestingly,
Premier
Peter Beattie of Queensland was quoted as saying: “While the
Commonwealth
has not ratified the Kyoto Protocol, Australia will meet its 2008-2012
emissions reduction targets because of my government’s ban on tree
clearing”. (I assume that what he meant was that by 2012, the
emissions
will have increased by only 8%.)

c. The Sidney Friday, April 8, 2005 forum was actually the third large
meeting in Australia on issues of climate change during this last week.

- the first meeting was on Monday, April 4, in Canberra - the capital -
and
was intended as “a reality check” bringing over US and Chinese
officials to
explain why Kyoto is moribund after the November Conference of the
Parties
to the UNFCCC that was held in Buenos Aires. According to the report
by
Alan Oxley in “The Australian” of April 5, 2005, it sounds as if that
meeting was of the earth-is-flat brotherhood.

- the second meeting was on Wednesday, April 6, in Melbourne. Our
friend
Alan Oxley writes about this meeting: “British government
meteorologists
will recycle claims that climate change is becoming dangerous. A
politician
from Niue will undoubtedly give another run to old (and discarded)
claims
that global warming will swamp Pacific island nations”. Having read
about
that meeting also on the ENS, I am convinced that this was a rather
decent
event - something I could not say about the Canberra event.

The bottom line is that both - a large portion of business and a
seemingly a
majority of the people in Australia - understand the KP better then the
federal Prime Minister.

The Lowy Institute’s report, “Australians Speak 2005″, found that
Australians are more concerned about global warming than about
international
terrorism or illegal immigration and refugees. Only the nuclear threat
worries respondents more than climate change.

Australian Greenpeace Clean Energy campaigner Mark Wakeman was quoted:
“Clearly Australians understand the warnings from scientists about
greenhouse pollution far better than our governments do. Once again,
the
community is leading and governments will be pulled into line”.
Further on this, our article, and the events of a week in Australia,
show
that business people can in effect pull ahead of the rest of the
people.