Nationals warm to low emissions target

Paul Osborne and Katina Curtis

A low emissions target is firming as the new focus of federal government climate policy, with the Nationals flagging support for it and Labor not ruling it out.

Chief Scientist Alan Finkel is expected to recommend the measure when his review of the energy sector is released at a meeting of federal and state leaders in Hobart on Friday.

The LET scheme would be similar to the existing renewable energy target, but take a technology-neutral approach, mandating a percentage of power each year be generated from sources below a certain emissions level.

Deputy Prime Minister Barnaby Joyce said he wanted to see the details, but appeared to be warming to the idea.

"It is vastly more likely to get a coal-fired power station built to provide baseload power under something like an LET," the Nationals leader told reporters in Canberra on Tuesday.

Prime Minister Malcolm Turnbull, who is chairing cabinet in Canberra, told reporters he did not want to speculate on the outcome of the Finkel review, but hoped to see a bipartisan approach to climate change.

Federal Labor is keeping an open mind, but warns the devil will be in the detail.

"We haven't dismissed it, what we've done is to characterise it as a second best option," opposition environment spokesman Mark Butler told ABC radio.

The opposition would work with business on the proposal, despite insisting an emissions intensity scheme is its preferred option - a measure already ruled out by the Turnbull government.

"We are acutely aware that there is an energy crisis in this country which needs a constructive, mature approach, particularly from the two major parties in the parliament," Mr Butler said.

Conservative Liberal MPs are confident Energy Minister Josh Frydenberg can deliver a policy which brings the party together on what has been an internally divisive issue in the past.

"I'd expect, knowing the work that Josh has done, that he'll be able to bring all colleagues with him," junior minister Michael Sukkar told Sky News on Tuesday.

"As long as the policy is sound, there won't be any problems in bringing the whole team with him."

Greens energy spokesman Adam Bandt said Labor needed to be cautious, as the proposed scheme could result in consumers subsidising gas and coal.

When Mr Turnbull was environment minister in the Howard government the proposed LET was limited to an emission intensity of below 0.2 t/MWh, which meant only renewables and coal or gas with carbon capture and storage would qualify, he said.

Media reports suggest the Finkel-proposed LET would be set at 0.7 t/MWh allowing the inclusion of gas and some coal-fired generation without carbon capture and storage.

"If gas and even new coal-fired power stations now count as 'clean', we might as well all pack up and go home, because it's game over for the climate and the planet," Mr Bandt said.

When parliament returns next week the Greens will introduce a bill to extend the renewable energy target to 52,500 GWh by 2030.