AUSTRALIA will make a "serious and credible" offer to cut greenhouse gas emissions beyond its current target at an international climate change summit in Paris, says Environment Minister Greg Hunt, a move likely to upset some in the Coalition who believe big cuts could damage the economy.
In the strongest sign yet the Abbott government will adopt a moderate shorter-term target ahead of the crucial global negotiations, Mr Hunt said Australia would look for consistency with other industrialised nations of a similar size when deciding on baselines.
Only weeks after the Climate Change Authority said Australia should push for a 30 per cent reduction in greenhouse gas emissions by 2025, Mr Hunt said some political and economic realism was needed ahead of the final target being announced in July.
He acknowledged not everyone would be happy with the final target but said Australia would build on its target to reduce its carbon emissions by five per cent by 2020.
However, some flexibility would be needed ahead of the global negotiations.
"Inevitably, some will say we've gone too far and some will say we haven't gone far enough. I understand that, that's our job," Mr Hunt said in an interview with The Australian Financial Review.
"You never play your hand in negotiations in advance but it will be a serious and credible offer and our ability to do things will be an increase on where we are."
'Significant and definitive target'
When asked whether Australia would choose a specific shorter-term target or indicative figure over a longer period, Mr Hunt replied: "We will put in place a significant and definitive target."
He was in Brisbane on Thursday to meet miners and agriculture and environmental groups as part of consultations over the post-2020 targets.
Some of the attendees included Rio Tinto, rail-hauler Aurizon, Queensland Resources Council, Peabody Energy, Canegrowers and the Queensland Conservation Council.
Mr Hunt said the strong results from the first carbon contracts auction last month - in which 43 firms will be paid $660 million to reduce 43 million tonnes of carbon - would help Australia easily reach its 2020 target of five per cent in emissions (based on 2000 levels) or 236 million tonnes of abatement.
"As a result of the first results from the emissions reduction fund, the speed limits on what we can do have been lifted," he said.
"Many of the savings (that have been locked in) are from two to 10 years, especially industrial changes will have permanent decreases in our natural baseline. So we might pay for a limited period of time but we will get a permanent benefit."
One of the biggest dilemmas for countries is what baseline year to use for carbon reductions.
Some of the biggest emitters use 2000 as a starting point while others, such as the United States, use 2005, and the European Union still uses 1990 as its baseline, making it hard to make a legitimate comparison.
Grattan Institute energy program director Tony Wood, who has recommended a realistic reduction of 15 to 20 per cent post-2020, said Australia should stick to a 2000 baseline but agreed there needed to be a consistent base year on an international level.