Australian government: carbon deal will be difficult

By James Grubel

CANBERRA (Reuters) - Forging a political deal on Australia's carbon trade laws will be difficult after a new round of opposition infighting, the government said on Tuesday, casting fresh doubts on whether parliament will endorse the plan.

The government is in talks with the opposition over changes to the carbon trade bills aimed at ending a political deadlock in the upper house Senate, with the government keen to pass the laws before December's global climate talks in Copenhagen.

But Climate Change Minister Penny Wong on Tuesday questioned whether the opposition could honor any agreement on the bills after a series of senior opposition lawmakers said a majority in the party does not believe in human-induced global warming.

"I think it will be difficult," Wong told Australian radio. "I think the question most Australians would have is, is the coalition (opposition) able to negotiate in good faith if these are the views of many of its Senators?"

Opposition leader Malcolm Turnbull wants a deal on the carbon laws to head off the threat of an early election on climate, but divisions with his party resurfaced late Monday when several opposition lawmakers said they opposed his policy.

Nick Minchin, the opposition's leader in the Senate, said the majority of the party did not believe in human-induced climate change, while several opposition backbenchers said they would defy Turnbull and refuse to vote for any carbon trade scheme.

Under the proposed scheme, carbon trading would start in July 2011, putting a price on greenhouse gas and giving business a financial incentive to curb emissions. Companies will need a permit for every tonne of carbon they emit.

The debate is being closely watched overseas, particularly in the United States where lawmakers are debating their own proposals, ahead of the Copenhagen summit.