Interviewed on Radio National in early February, Senator Wong was asked by Fran Kelly “How important, in your view, is setting a firm interim 2020 target for greenhouse gas emissions?”

Senator Wong replied “We have said that we will set an interim target. We have also said, and we have set a target for 2050. We think that targets are important because they do send a signal to the market and the community and they also give an impetus to the market.”

She said the Federal Government will also consider very closely the advice from Professor Garnaut.

In her speech to The Australian Industry Group, Senator Wong outlined the government’s climate change policy intentions, including design considerations for emissions trading. The speech followed the government’s release of the National Greenhouse and Energy Reporting System, Regulations Policy Paper, which the government has emphasised as the next step in creating a national framework for corporations to report greenhouse gas emissions and actions to reduce emissions.

“The new national reporting system will provide the data needed to underpin Australia’s national emissions trading scheme, which is a major part of the Australian Government’s commitment to action on climate change,” Senator Wong said.

The policy paper outlines proposed approaches to detailed reporting requirements including the scope of data subject to mandatory reporting, detailed definitions of terms such as facilities and emissions, and registration and deregistration information, as well as reporting requirements for greenhouse gas offsets, and actions to reduce or remove emissions.

Senator Wong said the government is committed to reducing emissions at least cost and that, therefore, an emissions trading scheme will be at the centre of its policy measures.

The scheme will place a limit, or cap, on the emissions allowed to be produced. Permits would then be issued up to the level of the cap and each year firms would surrender to the government a number of permits equal to their emissions. This is known as cap and trade.

This will produce a market for permits, which will be actively traded and will attract a price. It is this price – the cost of carbon – that will change the way that decisions are made throughout the economy, said Senator Wong. The idea is that companies that can easily reduce emissions will do so to avoid this cost, thereby freeing up permits for those companies who have fewer opportunities to reduce their emissions.

“This approach forces us to account for our greenhouse emissions. It means we are responsible for what we put into the atmosphere,” said Senator Wong.

“A new streamlined reporting system will be good news for business. Moving to a single system will cut duplication in reporting and reduce the cost burden currently imposed by the patchwork of separate greenhouse and energy programs.

“It’s also welcome news for the Australian community; providing for the first time, public information on the greenhouse and energy performance of large companies across the Australian economy.”

Eligible Australian corporations will be required to report on their emissions and energy for the 2008-09 financial year, with the first reports submitted by 31 October 2009.

“Consultation is a key part of this process. I encourage interested individuals and organisations to provide feedback on the proposals presented,” Senator Wong said.

Senator Wong also emphasised adapting to climate changes as the second pillar of the government’s climate change policy and helping to shape a global solution to this global problem.

“Australia is no longer part of the problem on climate change,” she said. “We are now part of the solution.”

Senator Wong said the government is committed to reducing emissions at least cost and that, therefore, an emissions trading scheme will be at the centre of its policy measures.