Abbott seizes on Obama emissions retreat

The Federal Opposition has seized on US President Barack Obama's new emphasis on energy from biofuels and burying CO{-2} emissions to portray Kevin Rudd as the world's sole supporter of emissions trading schemes.

Like the Prime Minister, the US President faces a hostile Senate after losing a crucial seat to the Republicans last month, leaving his ambition to introduce a scheme similar to the ETS in significant peril.

While insisting he would "ultimately" like to put a cap on carbon pollution, Mr Obama yesterday conceded his administration may have to make do with "incentivising clean energy" and by mandating construction of up to 16 carbon capture and storage plants by 2016.

Mr Obama's revised climate change position has echoes of the coalition's new "direct action" alternative to the Government's twice-defeated ETS, emboldening the Opposition to assert the ETS was dead in the water.

"This is a strike at the very heart of the Prime Minister's carbon pollution reduction scheme," the Opposition's climate action spokesman, Greg Hunt, said. "It's time for Mr Rudd to acknowledge that his ETS is now friendless, lonely and inappropriate for Australia." Mr Rudd said even though the US Senate stood in the way of Mr Obama's "aspirations", 30 other advanced countries around the world had adopted similar market-based approaches.

Opposition Leader Tony Abbott continued his attack on the ETS, peppering the PM in Parliament with questions about the impact of an 18 per cent increase in electricity prices on various households, from single-income earners on $45,000 a year and "a police officer and their teacher spouse who each earn $65,000 a year".

The PM said 92 per cent of households would get full or partial compensation under the ETS, compared with zero compensation under the coalition's alternative plan.

The Government last night released further analysis of the Opposition's rival $3.2 billion plan, showing it was underfunded by $14.9 billion.

Mr Abbott said the Department of Climate Change review of his policy was wrong.

"We have completely explained our scheme to the public and it's easy for us to do it because our scheme is simple and clear," he said. "Certainly vastly simpler, vastly clearer, vastly cheaper and very much more effective than the Government's."